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Unfortunately for Qantas, loyalty is cheap


Issues & Trends – March 2014

Unfortunately for Qantas, loyalty is cheap

QANTAS is overwhelmingly more popular than rival carriers among Australian travellers.

A clear factor in this is its Australian ownership with nearly half of Australian travellers surveyed by major online travel agency, Wotif, saying they are most loyal to a national Australian airline.

The bad news for Qantas is that Australian travellers are easily bought.

When buying a domestic flight, airline preference is the last thing Australian travellers consider. Price is the most important factor in their decision.

Price is also the key to choice of international carrier, although carrier preference is only the second last consideration of Australians travelling overseas.

The Wotif survey quizzed 14,839 Australian travellers. Asked which airline they preferred, respondents’ loyalties split as follows:

• Qantas (40.9 per cent);
• Emirates (15.8 per cent);
• Virgin Australia (15.7 per cent);
• Singapore Airlines (13.4 per cent);
• Jetstar (5 per cent);
• Other (4.5 per cent including Cathay Pacific 0.5 per cent);
• Air New Zealand (3.2 per cent); and
• Etihad (2.0 per cent).

Asked the most important factor in choosing a domestic flight, they replied:

1. Price;
2. Availability on the days I want to travel;
3. Direct flight;
4. Most convenient time of departure/arrival; and
5. Preferred airline.
For international flights, the factors were:
1. Price;
2. Availability on the dates I want to travel;
3. Direct flight;
4. Preferred airline; and
5. Stopovers available on the route.

Emirates will be pleased that it was ranked second only to Qantas on the preferred carrier list – neck and neck with Virgin Australia from whom it is separated by a statistically insignificant 0.1 of a percentage point, and ahead of well-established carriers including Singapore Airlines and Air New Zealand.

Jetstar’s five per cent score, ahead of Air New Zealand, is something of a surprise in view of the poor publicity its service levels have at times attracted. The New Zealand carrier is entitled to argue that, unlike Jetstar, it does not operate domestic services – but neither do Emirates or Singapore Airlines.

If Virgin Australia is disappointed by its third place in the preferred carrier rankings it can draw comfort from the fact that its Velocity frequent flyer scheme is clearly a success story.

Around three quarters of Australians (76.1 per cent, according to the Wotif survey) belong to one or more schemes.

It is an area that has long been dominated by Qantas ever since the collapse of Ansett left it as the only domestic carrier with a frequent flyer program.

But starting from zero, Virgin has now signed up almost three out of five Australians (58.1 per cent) with frequent flyer scheme memberships, according to the Wotif survey – a creditable effort, albeit still with some ground to make up on Qantas which has comfortably more than four out of five (85.9 per cent).

 

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