Qantas scheme hits seven million members
Membership boosted by retail hook-up
Australian airline Qantas has passed the seven million member mark for its frequent flyer programme.
The programme’s membership has increased rapidly since bringing Australia’s biggest retailer Woolworths on board as a partner, which saw shoppers able to earn frequent flyer points on everyday groceries.
Qantas says it expects “ongoing solid growth” in the foreseeable future in the rewards scheme, which is more profitable than its two airline units.
Qantas considered selling off its loyalty operation in 2008, but the airline now makes up to A$200m (US$180m) a year from the frequent flyer unit, according to analysts at Sydney-based Southern Cross Equities.
The loyalty operation is estimated by analysts to be worth A$2.2bn of the airline’s total A$6bn market value.
Of the scheme’s seven million members, Qantas says 2.5 million have earned points through its Woolworths partnership that started last June.
Membership has gone up by 25% since the Woolworth’s link-up and, since a major overhaul in mid-2008 numbers have increased by 32%.
Nine out of ten Qantas frequent-flyer members use their points with the airline, either for flights or upgrades. The scheme has over 400 partners including Hertz, United Airlines, British Airways and American Express.
The carrier says it may look at expanding its loyalty activities overseas in the long term. This would follow the example of Canada-based Groupe Aeroplan (operator of Air Canada’s loyalty scheme), which bought the UK’s Nectar card scheme owner LMUK in 2007.
Simon Hickey, Qantas frequent flyer CEO, said it would initially concentrate on its home market: “We are targeting eight million members by the end of next year as more and more Australians realise the advantages available to them through Qantas Frequent Flyer.”