Behavioural economics, soft diplomacy and hardnosed pragmatism of airline marketing

Welcome to a Tuesday update from Unmade. The full post is only available to our paying members.

Today: With yesterday’s news that Qantas has made its ghost flights scandal (expensively) go away, we reflect on the state of airline marketing. And on the Unmade Index, IVE Group reels from the sudden death of its executive chairman.

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Flying at different heights

Soon, we’ll be telling you all about our plans for Unmade Compass.

It’s our end-of-year event which is free of charge for Unmade’s paying members. In essence, it’s nothing more pretentious than a panel-in-a-pub. Four or five interesting people reflecting on the year just gone and the year to come, answering questions from a friendly audience, shared with Unmade’s wider community later, in the form of a podcast.

Compass started as a single night in Sydney in 2021, grew to Sydney and Melbourne in 2022 and 2023, and this November will become a six-city tour of Hobart, Sydney, Brisbane, Perth, Adelaide and Melbourne. It’s a great way of taking the temperature of a fast-changing industry.

This isn’t an announcement just yet, by the way. (Although if you’re the sort of person who likes to plan, these are our provisional dates: Hobart – November 5; Brisbane – November 12; Sydney – November 13; Perth – November 18; Adelaide – November 19; Melbourne – November 20.)

There’s a reason I’m mentioning this now, before everything is fully locked in. This week, I experienced some airline behavioural economics at first hand. And I fell for it.

Jetstar announced its 20th birthday sale. And then Virgin Australia gatecrashed the party, announcing its own promotion too, cheekily entitled the “We’re coming to the party sale”.

And like all sales, there was a deadline. Suddenly, loss aversion kicked in.

If I didn’t book those cheap fares now, then I’d miss out. Rationally, I knew there’d be another sale, but nonetheless, I’ve spent hours figuring out, route-by-route who had the best times and prices to help us crisscross the country.

And while I was at it, I booked in some other planned work travel too. The company credit card is now stacked with Virgin and Jetstar transactions.

It took the urgency of today’s looming deadline to get me to take action. And that was with the knowledge that if we can’t get the right venues or speakers on the days booked, the ticket might be useless. Airline marketing is a hell of a drug.

It’s also steered me in a new direction. After years of being a Qantas loyalist, I’ve accepted that being Platinum One is already history, and soon I’ll lose my platinum status too. On Friday I’m heading to London for the Advertising Week Europe conference. It’ll be my last time of enjoying that salt and pepper calamari in the lounge.

Meanwhile, yesterday saw Qantas settle with the ACCC to make its ghost flights scandal go away. The price of avoiding a reputation-sapping court battle was $120m.

It was marketing strategy of a different kind – defensive corporate comms. Yes, the company might have won if the case went all the way. But its argument that customers are buying “a bundle of rights” to get somewhere, not a seat on a particular flight made it look shady. Continuing to press the argument would have done more than $100m of damage to its wobbly reputation.

Now we’re likely to see a normalisation of the marketing battles. Jetstar versus Virgin at the low cost end, and Qantas running its own race.

As we return to pre-Covid patterns, I have a hunch that Qantas may think more about its soft power. The public are now more cynical about all those free Chairman’s Lounge memberships for politicians. I have a hunch that more of the pollies will in time become a little more embarrassed to accept the perk.

It’s not what could have saved Bonza. But The Betoota Advocate’s implication does have an underlying truth to it: Soft power undoubtedly helped persuade the Coalition to bail out Qantas at the beginning of Covid.

Like most marketing, it’s a far more sophisticated game than it looks.

Further reading:

Unmade Index dips on sad day for IVE Group

It was a mixed day on the Unmade Index with most of the larger stocks nudging downwards.

Among the broadcast players, Nine lost 0.34%, Seven West Media stood still, ARN Media lost 1.76% and Southern Cross Austereo gained 1.05%

Print and marketing operator IVE Group told the market yesterday that its executive chairman Geoff Selig has passed away suddenly during a European holiday. IVE prints most of Australia’s magazine titles.

Time to leave you to your Tuesday.

We’ll be back with more tomorrow. In the meantime, don’t forget that as a paying member of Unmade, you get a discount on tickets to HumAIn which is now just three weeks away. The coupon code is below.

Thanks as always for supporting Unmade..

Toodlepip…

Tim Burrowes

Publisher – Unmade

tim@unmade.media

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