The CMO Show: Stephanie Tully on the value of loyalty

How do you incorporate an iconic legacy into a modern customer experience? Stephanie Tully, CMO at Qantas knows a thing or two.

For generations of Australian travellers, Qantas’ iconic red tail has been a symbol of adventure and home alike.

Today, as its Frequent Flyer loyalty program turns 30, Qantas faces a unique and interesting challenge: Maintaining that strong emotional connection whilst bringing the brand into the digital age. For Stephanie Tully, Qantas’ executive manager of Group Brand and CMO, this is the perfect challenge.

It’s all about empowering the company’s thousands of frontline staff to deliver authentic and personal experiences, says Tully, who started her career with the airline as a cabin crew manager more than a decade ago.

“It’s important that our staff who spend the most time with our customers are equipped to have those really authentic interactions,” says Tully.

However, authentic interactions and conversations can also come from a variety of digital channels, she says, as long as an organisation fundamentally embraces cross-channel integration.

“I think lots of businesses, including us, are on the journey of stitching together all of their channels so that they can talk to customers across channels in a seamless way.

“I think more and more, you know, there’s a future coming where there aren’t many channels that are left that are not being used in a one-to-one way.  Even television and radio will end up being personalised.”

Tune in as Tully joins CMO Show host Mark Jones to discuss the future of customer experience, the value of data driven personalisation and the complexity of building different emotional connections with customers all over the world.

Listen to the podcast above and subscribe on iTunes and SoundCloud.

Resources (list 3-5 resources mentioned in or relating to the episode):

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The CMO Show production team

Producers – Megan Wright & Tom van Leeuwen

Audio Engineers – Jonny McNee & Daniel Marr

Got an idea for an upcoming episode or want to be a guest on The CMO Show? We’d love to hear from you: cmoshow@filteredmedia.com.au.

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Transcript

Participants: Hosts: Mark Jones (MJ)

Guest: Stephanie Tully (ST)

MJ:   Well, welcome to the CMO Show again, my name is Mark Jones, and our very special guest this week is Stephanie Tully.  She’s Executive Manager Group Brand and Marketing/CMO at Qantas.  Stephanie, thanks for joining us.

ST:   Thanks for having me.

MJ:   What would you say makes an authentic experience these days, compared to maybe how you’ve thought about it in the past?

ST:   I think for us, it’s really about that word exactly, so being authentic.  Even through a period when we were going through lots of cost transformation, we, one thing I’m really proud of is that we never stopped investing in our people from a service perspective, and lots of people were telling us at the time Qantas service is changing, and we put a lot of emphasis on empowerment and authentic moments with customers, because to be honest, your frontline staff, and we’ve got thousands of them, are the most important people in your marketing team, really.

MJ:   Yes!

ST:   And they are out there representing the brand every day, and making them A, love their jobs, but B, feel really comfortable to  have those authentic experiences, and that can be quite different from other airlines where it’s more prescriptive in terms of you know, even the way perhaps cabin crew can act in flight.  So making sure that whilst we maintain premium professionalism, that our people feel like they can be themselves and deliver authentic information, and that’s a style service training thing, but also about us equipping our people with the information on customers to enable those rich interactions.

So as an example, we give our flight attendants now, through technology and data, quite rich information on the customers that they’re serving.  So that they know if someone has become a platinum in the last couple of months, or may have had a service failure on a recent flight, or his favourite drink is vodka and orange, or whatever it might be, that the crew that spend the most time with our customers, particularly on the longer flights.  You know, we’ve got Perth London on sale now.  It’s going to be a long time on board, and making sure that they’re equipped to have those really authentic interactions based on knowing our customers.

MJ:   That’s fascinating, because they’re the moments of delight, as they say.  You know, the impressive sort of…  That sense of, “Wow, they knew I like vodka and orange.  It’s like, wow.” You know?

ST:   I don’t know why I brought up vodka and orange.

MJ:   No I know, but…

ST:   I used to drink that a lot. [Laughs]

MJ:   You’re talking about the humanity, the authenticity of a person.

ST:   Yes.

MJ:   And I really love that.  How do you make that a digital thing as well?  Because digital ostensibly is cold and technical, and stuff.  You know?

ST:   I think it’s… It’s really interesting.  We spend a lot of time thinking about it, because I think it’s just…  For us, we think given our history, you know, Qantas is turning 100 in a couple of years, and our Frequent Flyer program turned 30 this year.  We should have a competitive advantage in knowing our customers better than our competitor, because we have a longer relationship with our customers, and you know more about them through your interactions with the customer.  So really it’s about how do you use what you know about customers to make their experience more personalised?  Be it be, you know, through face-to-face interaction with one of our staff, or through digital.

And I think, so lots of businesses can do online sort of targeting stuff, because they know what customers are doing in an online environment.  The trick I think is in how you marry up your offline data, if you like, in terms of…  And when I say offline data, I just mean all the things you already know about your customer from – from your relationship.  And how do you marry context of online with what you know about them offline, and then personalise their experiences based on that?  That’s I think, you know, you’re trying to make digital…  Because more and more we’re seeing more people even buying digitally.

MJ:   Yes.

ST:   And obviously, marketing has shifted and you’re connecting with people from a pre-purchase perspective more digitally.  So how do you make those experiences as relevant as possible?  We do our own…  You probably know, we have an internal digital trading business called Red Planet, and so we buy our own programmatic internally.  We’ve bought that in-house a couple of years ago.

MJ:   Yes, that’s right.  Yep.

ST:   And, you know, that’s been, I think a real win for us, because we, you know, a lot of the analytics and propensity modelling, and all the things we’re doing to really understand people, and therefore serve them better, is done by our own teams in here, our own analytics and our own marketing teams, you know, using that information.  So it enables you to do that personalised messaging.

MJ:   What kind of outcomes have you seen as a result of that – that shift?  You know, can you quantify it in terms of sales, or any other metrics that are important?

ST:   Yeah, I think the beauty of it is, because you’re no longer measuring a channel, you’re measuring a customer.

MJ:   Yes.

ST:   So, you know, in terms of the incremental impact of stuff that you do, be it through paid or owned channels, you can now know who you’re doing it to, and also measure the impact of it. We’re definitely seeing the revenue impact of it in a very strong way, and I think the other thing is it’s really important to have positive agency relationships, but there’s nothing like having your own people that actually have skin in the game, really thriving on optimising results for the person that ultimately is paying them.

MJ:   [Laughs]

ST:   So, you know, getting that engagement and people wanting to see the results, even though we in-source our search engine marketing, something as critical as that, and having someone that’s actually doing that optimising, measuring it, testing stuff the whole time, as we’ve seen huge uplift from that – that process.

MJ:   We all talk about this, but you fly into Sydney, in particular for me anyway, as a Sydney boy. There’s a lot of talk these days about emotion, about the power of emotion to tell a story, but also to really encapsulate what a brand means.  So how have you thought about that in the Qantas context?

ST:   Yeah, a lot.  I mean it’s funny, because we have obviously a big, the biggest presence in point-of-sale Australia, in terms of marketing to Australians who are either travelling domestically or travelling globally, but also how you use that emotion about…  You know, about not far from half of our planes are filled with people internationally that are coming in to visit Australia as well.  So, you know, that emotion can be different depending on what market you’ are talking to.

MJ:   Yes.

ST:   And when you’re marketing off-shore to all of our major hubs around the world, you’re really talking about, you know, the emotion of the destination, and that the best of Australia starts with Qantas, and the minute you get on a Qantas plane you are – you know, your journey to Australia has started.

MJ:   Yes.

ST:   Whereas for Australians, you can really engage by that emotion of Qantas…  You know, we know from a lot of insight that for many people Qantas means home, and Qantas means belonging.

MJ:   Yes.

ST:   People often talk about seeing the Qantas tails at Heathrow on their way home, and feeling like they’re – they’re home.  So it’s really about trying to emotionally engage with those territories, where Qantas can play a role, and that’s been a particularly important for us over the last few years, as the business has, you know, recovered and transformed through some of the events of the early 2010s, where we had the business undergoing quite a big transformation.

MJ:   Yes.

ST:   Where there were points where the love for Qantas perhaps wasn’t as strong as it should be.

MJ:   Yes.

ST:   So really, particularly in some of the work we’ve done over the last couple of years, with Feels Like Home, and really rebuilding that emotional connection with Australians, because you want Australians to want to fly Qantas.  So that emotional connection is perhaps the most important thing for our brand.

MJ:   I’m really interested in how you think about this from a brand strategy point of view, and I guess loyalty programs we know in the airline industry are enormously important to you.

ST:   Yeah, it is, it is, and we definitely put a lot of emphasis on how we are perceived from a value-to-money perspective, because often we’re not always the least expensive option.  So, you know, consumers being driven by price, it’s absolutely a factor, but there’s lots of other factors around customer experience, and trust, and, you know, other things that drive people to ultimately want to fly on an airline, or engage with its loyalty program.  So we definitely, given the position that we have in the market, try and think of that holistically.

MJ:   Yep.

ST:   And loyalty’s such an important part of that, because you know, the whole premise of a loyalty program is about getting people inspired to be sticking to your business so that ultimately they get a reward.  So making sure that that is seen in quite an emotional way as well, because most people use their Qantas frequent flyer points still for flying, and usually for leisure trips with themselves, or their partner, or their family.  So reminding people that even when you’re making that choice to fly with Qantas for business, that there’s an emotional reward that all these business trips are adding up to as well.

MJ:   Yeah, well competition, you know, it never stops, right?  But we’ve seen particularly in the airline space, a more international competition, which is shaping things for Qantas. How do you work on those segments, and divide your attentions?

ST:   Yeah, so we, obviously in Australia we have a large proportion of the country in our Qantas Frequent Flyer program, we’ve got 11.7 million members now.  So the depth and breadth of data you have on your customers is quite strong.  So, you know, we have detailed segmentation at a market level, but also down to just being able to talk to people on a personalised basis based on who they are as an individual, so it’s sort of segments of one.

But offshore, particularly in our larger markets like London, and Singapore, and Los Angeles, we also have quite a strong Qantas Frequent Flyer presence as well, and our aim is to get, you know, obviously as many people in the programs, even in the inbound markets, because that enables you to then understand and get that breadth and depth of information that you can design experiences around, both from a customer experience and a marketing point of view.

MJ:   You’ve had quite a number of years in Qantas, and from my understanding a lot of experience.  So where did it all begin?

ST:   This is not my first airline either.  So when I left university, I worked for another Australian airline called Ansett some years ago.

MJ:   Yes.

ST:   And so I got a taste of aviation, I guess, as my first career, and I was on the graduate program there, and did lots of different things.  And then when that – Ansett, you may remember collapsed…

MJ:   Yes.

ST:   And I left the industry for a few years and dabbled in professional services and retail, and eventually was drawn back to Qantas.  A number of Ansett people including our CEO, Alan Joyce had come to Qantas, and at the time they asked me to come in, and I was living in Melbourne, and I told them that I would – that I would join, but I was not moving to Sydney.  [Laughs] So I started actually in Melbourne, oddly enough, managing the cabin crew that were based out of Melbourne. That was over 10 years ago now.

I’ve been at Qantas sort of that time, and I’ve actually moved throughout the business.  So I spent quite a lot of time in customer experience, and product development, working on aircraft seats and check-in, and that sort of stuff.  Then moved to our loyalty business, which…  Well, I was at for about four years I think, in terms of doing a variety of marketing and commercial roles.  Very data centric roles, and about two years ago now, came back into the group role where I still look after the airline, but also the loyalty marketing.  So I get to do both, which is awesome.

MJ:   I’m really interested in

MJ:   the concept of an integrated approach to marketing and communications.  It’s globally become a big focus for a lot of large brands, making sure that everything’s aligned, that you’ve got a consistent approach to the customer through all of the different channels that you use, and your different partners.  How are you thinking about that?

ST:   Yeah, I mean, I sort of don’t know any other way, to be honest.  So I think integrated marketing’s key.  I think lots of businesses, including us, are on the journey of stitching together all of their channels so that they can talk to customers across channels in a seamless way.  I think more and more, you know, there’s a future coming where there aren’t many channels that are left that are not being used in a one-to-one way.  Even television and radio will end up being personalised.

MJ:   Yes.

ST:   The technology’s one side of that, but also just building your teams in the process and capability to really get that stuff humming is very important.

MJ:   And we should talk about Q Magazine.  I’ve got to say, I’m a bit of a fan how you’re taking what you’re learning of the audience, and producing the publication, of course is a content brand of your own, an owned channel.

ST:   Yeah, we love the magazine.

MJ:   There you go.  How’s it going?

ST:   Yeah, good.  We actually partnered with a company called Medium Rare on that magazine.  They’re part of News Corp, and they do that content for us, and it’s – we relaunched it in the last sort of year, but it’s doing really well, and we also have digital versions of it, and we’ve also launched a couple of travel inspiration sites.  So one called Travel Insider, and one called AWOL, which are really geared to that consideration stage of travel, and trying to produce lots of inspiring content around destinations and things to do in destinations.

MJ:   Yes.

ST:   And they are doing really well, as well, as a real feeder for the whole Qantas path-to-purchase as well.  So really, really well I would say.

MJ:   And – and to your point that it’s like an inspiration.  You’re on a plane, but you’re now thinking about where you might go next time.  Is that the strategic goal?

ST:   Yeah, and lots of the data – lots of the data says that most people, from a leisure perspective, are planning their next trip, and the key time for planning is on the trip before and very soon after.

MJ:   Yes.

ST:   So it’s a really important time to talk to people about what’s next.  I don’t think there’s many of us that can survive without a holiday locked in somewhere in the future.

MJ:   [Laughs] I know, right?  Yeah, it’s a big deal.  So then I guess as we look ahead, what’s the – what are the sources of inspiration for you?  Where do you see the future of this integrated approach, and the customer experience, and it all coming together?

ST:   Yeah, absolutely.  We’ve got really key strategic partnerships with players like Facebook, and Adobe, and Google to make sure we’re on the cutting edge of change from that perspective. That’s why you have creative partnerships as well, so that you have fresh thinking, and can get inspiration from creative partners, and for me as well, I am lucky enough to sit on one of the industry boards.  So I get to spend time with lots of other CMOs, or chief data people, or chief technology people from other companies that I draw a lot of inspiration from as well.  It’s great to be able to get out of Qantas, and get that inspiration from other industries.

MJ:   Yeah, that’s… That’s ADMA, isn’t it?

ST:   Yeah.

MJ:   Yeah, right.  So being among peers and other leaders to see how other people are doing it, of course always a great idea.

ST:   Yeah, amazing.

MJ:   I really enjoyed hearing your story, and hear how you’re bringing it all together.  It’s fantastic to have your time.  Before we let you go, you may be aware that at the CMO Show we have our rapid fire 21 questions, and…

MJ:   So are you ready?

ST:   Yep.

MJ:   What are you grateful for?

ST:   Family.

MJ:   Do you like rain?

ST:   No.

MJ:   In the movie of your life, who would play you?

ST:   Too hard.

MJ:   Too hard?

ST:   One of my daughters!  [Laughs]

MJ:   There you go!  Future star perhaps.  What’s your greatest career fail?

ST:   Being a control freak.

MJ:   Beach or mountain?

ST:   Beach.

MJ:   Best ever career advice?

ST:   You’re not curing cancer.

MJ:   Summer or winter?

ST:   Summer.

MJ:   Who’s your hero?

ST:   My dad.

MJ:   If you weren’t a marketer, you’d be a…?

ST:   Some job on a beach somewhere.

MJ:   Taken there on a Qantas plane of course.  Chocolate or strawberry?

ST:   Chocolate.

MJ:   What did you have for breakfast?

ST:   Nothing.

MJ:   What would you rather have had?

ST:   I’m not a breakfast person.

MJ:   Nice.  Scrunch or fold?  A very important question.

ST:   Fold.

MJ:   If you could change one thing about the marketing industry, what would it be?

ST:   Marketing is grey, and everyone needs to embrace the grey.

MJ:   Oh, I like it.  Can you ride a bike?

ST:   Yes.

MJ:   What’s your greatest frustration?

ST:   Time, lack of time.

MJ:   Touch – and here’s five senses, touch, taste, sight, hearing and smell.  Which would sacrifice to save the rest?

ST:   Probably smell.

MJ:   Dogs or cats?

ST:   Dogs.

MJ:   Favourite book?

ST:   So many.

MJ:   Yeah, that’s true.

ST:   I still love Anthony Kiedis’ autobiography.  I can’t remember what it’s called.

MJ:   Scar Tissue.

ST:   Yeah, Scar Tissue.  Awesome.

MJ:   Excellent.  

MJ:   And the last question, if you had to change your first name, what would you change it to?

ST:   I’ve never thought about that.  I mean, I’ve got two daughters, and I named them Kiara and Imogen, so I love their names.  So maybe one of their names.

MJ:   There you go.  Well, Stephanie Tully, it’s been a pleasure having you on the show today.  Thanks for your time, and I really appreciate your insights, and all the best with creating amazing customer experiences at Qantas.

ST:   Thank you for having me.

 

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