How does Qantas create customer experiences that matter?

In April, 2014, more than 150 customer experience, data, marketing and business leaders participated in the first Customer 360 Symposium run by  Ashton Media.

This is the first of three posts based on a presentation given by  Paul Smitton, Executive Manager Customer Engagement at Qantas Loyalty,  who talked about how Qantas created diverse and authentic customer experiences that linked back to their core travel offering.

The evolution of the Qantas Loyalty program

Twenty years of loyalty, it’s been a pretty wild ride and that first initial baptism of fire when I actually had to come in and come up with a frequent flyer program in a heartbeat and do a whole lot of stuff that should’ve been done pre-launch, post-launch because we just didn’t have time. It was pretty crazy. And so twenty years later I’ve now found myself still doing loyalty after all these years.

What I want to do today though is talk to you a bit about a particular part of our loyalty program which we’re really excited about and just to explain to you how that’s working for us and why we think it’s so interesting.

But before I do that, maybe I’ll just quickly explain who Qantas Loyalty is. A lot of you know of us as Qantas Frequent Flyer, the loyalty program that’s been around since 1987. That program has kind of had two major life stages. It had the pre-1987 phase, the 1987 to 2008 phase and the 2008 to now phase.

So pre-2008, it was very much a frequent flyer program that looked after our most valuable flyers. From 2008 it became a coalition program and it really widened into being a program for every consumer in Australia.

Culminating in the last little while where last year we had 1.2 billion dollars in billings which means that we now have a pretty successful, diversified loyalty business that offers a whole range of different things, from the consumer loyalty side with the frequent flyer program through to business loyalty with the recently launched Acquire program.

We also have a very successful employee loyalty program called Accumulate and we offer loyalty services to help other organisations to do loyalty as well. So it’s quite a diverse business now and really a key part of the Qantas group.

The Qantas epiQure program

What I am going to focus on really is frequent flyer and the Qantas epiQure program.  9.7 million members as at the end of our half year results, end of December, fast approaching 10 million.

We have a hugely diverse group of consumers in the program. One thing that was very interesting was that we surveyed our members about two years ago now and asked them what their interests were among a number of different things.

What came out was that food and wine was actually the number one interest of the base. It wasn’t travel. Travel came out number two.  Food and wine was the number one interest and we thought, what can we do with that? What’s interesting? So off that we said, let’s launch Qantas epiQure as a food and wine community and business to drive incremental revenue but also to drive core engagement back on the frequent flyer program.

We have also done some other interesting things in the last couple of years which is launching the Qantas point’s currency so now we very much have a coalition currency that’s very identifiable and easy to understand. We’ve also launched the Qantas cash program where every membership card is now also a pre-paid travel card or a card for everyday use in Australia.

Do we have any authenticity?

I’m going to talk primarily about epiQure today and what led us to launching it. Firstly it was around saying, well, do we have any authenticity? We know that our members love food and wine, but do we have authenticity in this space? And what we found was that yes, we do.

For the last six or seven years we’ve consistently won this award called the Cellar of the Sky which means we have the number one cellar of any airline in the world in terms of quality of wine. And that’s great because it’s primarily Australian produce so we’re really showcasing the very best of Australian food and wine.

We have a wonderful wine panel which consists of three of Australia’s leading wine makers, Tom Carson, Vania Cullen and Steve Pannel. They sit down and say, what are the iconic wines and how do we link those iconic wines into the Qantas wine cellar?

Off the back of that, we’ve consistently won these awards.  Last year in fact, we won five gold awards out of only thirteen awarded across the global aviation industry so that’s pretty cool. That gave us a big tick to say, yes, we have the authenticity around wine.

We also knew that after Woolworths and Coles, we’re the number three purchaser of wine in Australia so that gave us another ability to say, yeah, we can actually go to that industry and get access to the products that will help us deliver a good value proposition. When you combine that with our inflight service and our food offering, it gives us that really strong reputation.

Our engagement with celebrity chef Neil Perry

One of the great things we have is Neil Perry. A lot of airlines around the world have done endorsement deals with celebrity chefs and we aren’t like the BMW example with Gary Meehan.  It’s an endorsement; it’s not actually a deep engagement.

Neil is actually our Executive Chef. He doesn’t just put his name on it, he actually has a team involved working with our catering department, working on menu design, going to our global markets, understanding what products are available, what’s in season at what time and then also spending time with our catering kitchens around the world to see what their ability is to recreate these dishes?

There’s no point coming up with an amazing rock pool inspired dish if you think that the catering kitchen in Dubai or Singapore isn’t going to be able to recreate that to a quality standard. So Neil spends time trying to find the right mix of in season products with an ability to actually recreate that for our customers. So that’s great.

We are the only airline in the world that has such a relationship. Every other airline does it more as an endorsement with a celebrity chef. So that gives us great authenticity as well around food.

Fine wine and expert advice

We also have a fantastic relationship with our inflight sommeliers who we’ve trained to a very high standard around wines. They’re able to give our customers the expert advice to match the food and wine so that is another thing that gives us that authenticity.

Then off the back of that, and this is just an example of two of the gold winners. The best chardonnay – the best white wine in any airline cellar last year was this lovely Leeuwin Estate Chardonnay and the French champagne that we serve in first class was the number one champagne of any airline in the world.

Customers love the fact that those wines they’re drinking inflight are also available to buy when they’re on the ground and that’s another great way to get that engagement back.  And you can see there as well that it links back to the core proposition because we say, you can buy it with cash or you can buy it with points which is really, really important.

Let’s build an engagement around food and wine

I guess with launching Qantas epiQure and why we did this, it was really saying we’ve got authenticity around food and wine, we know we have an engaged member base who love food and wine, so let’s build out a new category. Let’s build an engagement around food and wine by launching the program.

What that does is it allows us to have another reason to engage. It takes us into a new domain beyond travel. So we have that deep engagement in travel space with the core inflight offering.   We now have another territory we can go to which is one step away from the core, but it’s also entirely relevant for us to do so.   It gives us that deep engagement around food and wine but then also allows us to link back to the core travel offering as well which I think is a really interesting way to look at it.

So this is what Qantas epiQure looks like. The propositions become core to the frequent flyer program where members are able to earn three points per dollar every time they transact and they get free delivery.

It also has some fantastic content. One of the most engaging emails we ever send is when we tell people there’s a new Neil Perry recipe available on the site. That drives engagement into the community. And it’s very much a soft sell. We don’t try and hammer people with the wine, we try and do it in a soft sell sort of way by introducing the engaging territories like events and recipes that they really find interesting.

I guess the key message is to say that everything that we serve inflight is now available to buy on the ground.  That’s what we say and we’ve got about 500 products so it’s quite an amazing cellar that we have inflight and we have about 500 of those products in the range on the ground.

In the next post, Paul talks about  understanding your customers so that you can give them what they really want.