The Power of Brands – when 'Sorry' is the hardest word to Say

Qantas celebrated its 91st birthday yesterday with the launch of its new new Boeing 787 Dreamliner with little ceremony.  The more subdued approach to the milestone and the new plane is a sign of the company’s desire to avoid any negative media attention.  In recent years we have slowly watched the brand decline with the decision to ground the fleet at the end of October, simply the icing on the cake.  As our Truly Deeply Strategy Director, Peter Singline, discussed in his blog, Qantas brand strangled by business strategy, “its focus for so long has been about the business and not brand relationships. Worse it seems that with the on going pursuit of cost cutting it is also cutting the guts out of the culture of Qantas”.

In the last few weeks, Qantas has ramped up efforts to win back customers following its controversial grounding and earlier industrial action, which has cost it at least $110 million. Reiterating comments he made earlier this week, Mr Joyce said he was ”optimistic” that Qantas would reach agreements over new collective contracts with unions representing long-haul pilots, aircraft engineers and ground crew by Monday.  That is the deadline the industrial umpire has set for negotiations to reach a compromise or the sides will face binding arbitration unless they can agree to a 21-day extension.  As quoted in The Age, ”I continue to be hopeful that we can reach agreement,” he said. ”Once these industrial relations issues are out of the way … it is all about Qantas getting back to business as usual.”

The latest decision to increase the frequent flyer points earned for passengers travelling over the next weeks as a “thank you” to its frequent flyers is another gesture from the company to try and rebuild its customers relationships and gain back the trust Australians once had in the brand.  However, there is potential for the gesture to backfire as some frequent flyer thank yous are set to be bigger than others, with top tier members receiving greater gifts. As The Age reporter Craig Platt pointed out in his article, ‘Qantas reveals its frequent flyer thank you’ earlier reports that Qantas would offer to double frequent flyer points for passengers were only partially correct with only platinum and platinum one members receiving double points.

Qantas’ is proving to be incredibly resilient to the backlash with many Qantas customers willing to forgive and forget.  This is truly a testament to the power of brand and the brand’s current commitment to doing everything it can to help those customers who have been negatively effected in the last couple of months. This dedication is certainly proving to help the brand with Qantas shares rose as much as 7 per cent on Tuesday before closing up 5.5¢ at $1.705, making it the biggest gainer among the top 200 companies on the ASX.  However, this renewed commitment needs to be maintained and must remain a key part of the Qantas Way if it is to retain its customers.

If you want help building your brand’s relationship with customers, why not give us a call?

Nikki Williams
Client Account Manager 



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