How Qantas Airways Survived The Impact Of The Covid-19 Pandemic

The Impact of Covid-19 on the World and the Airline Industry

The pandemic had a massive impact on the world, it created new business opportunities on the positive side, and on the negative side it destroyed business, the Covid-19 pandemic has successfully closed more than 1000 small-scale businesses in any one geographical area. Countless people have lost their lives and their jobs. The pandemic has changed the way how business works and the motives or organizational goals of many companies. One of the heavily impacted industries is the airline industry as the governments of every nation collectively had banned international as well as domestic travel by air during the pandemic. In modern times the restrictions have been eased somewhat but not completely lifted hence they suffered the most. Qantas airways limited from the Australian airline market have been chosen for the study. Here the report will present how the pandemic impacted their methods and how the brand adopted various new techniques and methods to survive and operate in the new normal world.

The company is Qantas airways they provide air travel for people with domestic as well as international travel requirements. The main reason for the rapid spread of the Covid-19 pandemic was international traveling as people from different nations became the unknown carrier of the disease. So all flights were canceled overnight and every ticket had to be refunded to the passengers which was a Huge Rapid Financial Loss. With the travel ban, they were completely shut down during the full nationwide lockdown. As they do not provide any other services Qantas was not operating for the entire duration of the lockdown which made them and other companies in the same market suffer massively (Mustapha, Yazid & Shamsudin, 2020).

The Qantas group launched a marketing campaign and updated their homepage with the fact that they still have the best domestic flight rates despite the Covid-19 damage to the business and ensured the customers that they will continue to operate with their existing pre covid rates. Alan Joyce the CEO said that they believe they are the national carriers and always will be committed to supporting tourism. They launched a 3-year plan to fight the pandemic crisis. They started relying on marketing, not their business as the business was stopped but they marketed their social work (Atay, Ero?lu & Ulusam Seçkiner, 2021). The primary aim is to restructure the business and make sure that they are removing $1 billion in expenses or rather costing from the business starting from the financial year 23. They led an operation where they operated many international flights to bring back the countless number of Australians home who were stuck across the borders. They would initiate project Sunrise which is the constant non-stop international flight services once the travel ban is lifted to help both the passengers and their own business to grow as well. When it comes to the services they changed keeping the social distancing and other measures in mind they decided to implement some new measures. Social media was not only used for marketing but communication as well. They introduced the system of every air hostess wearing a PPE suit and mask along with a heat shield to maintain safety. They provided a light paper or plastic robe, face shield, and mask to every passenger for safety in traveling. At the same time sanitizing the plane as well as the customers and keeping sanitizers in almost every corner of the airport to make sure that the passengers can use sanitizers whenever needed to maintain hygiene and safety.

Qantas Airways and the Rapid Financial Loss Due to Pandemic

Political – The political condition in the USA was critical during the pandemic. With the change in the government and the entire Trump presidency situation, the political stability of the nation was in question. However, the USA always had been in favor of foreign business hence despite the difficult political situation it is a good time to expand or rather work in the USA market as post-pandemic they will be willing to accept new job opportunities and chances for economic development.

Economic – The USA is known to have the largest economy in the world and when it comes to the global economy they are currently in the 3^rd spot and it is expected that by the next 5 years they will grow rapidly. The US-China trade war and US-Iran standoff have created some economic problems. The economy shrank by a massive 3.5% due to the pandemic and it is to be understood that labor is not cheap hence the basic wage rate is another concern for Qantas (David, Rahman & David, 2022).

Social – The social scenario of the US has always been a concern for foreign enterprises. they are culturally very sensitive. The recent black lives matter movement and the general concern for racism have created a social disturbance that has created riots and protests. However the community or people in general love and accept other communities or trends hence spreading to the USA will have no social challenges as they have no issues or hatred towards an Australian community or brands.

Technology – When it comes to technology the USA has some of the most advanced technological setups and advancements in the whole world. Be it the drone technology or fully automated warehousing by smart bots the USA has always had the best technological environment and innovation throughout its history. If Qantas were to operate in the USA they might learn and develop heavily in the technological part of the brand so this part can be advantageous for them.

Legal – Legal matters will always be a problem for any business in a different nation especially when the nation is the USA which has strict legal measures (David, 2018). Especially when the business is air travel they will have special security measures and at the same time, there are various permits and licenses that Qantas needs to obtain from the USA government to operate. Acquiring them quickly and efficiently for a company such as Qantas can be fairly easy.

Environment – The environment has always been a concern for businesses in the USA. Pre Covid-19 the year 2019 USA had a total of 79.26 million tourists visiting them (Cai, Hu & Li, 2022). It has been recorded that the USA has faced some of the toughest weather and natural disasters. In a single year that is 2017, they suffered 15 climatic disasters that led to more than $1 billion each time a disaster happened in terms of losses to property and business (David, Rahman & David, 2022). Hence Qantas can expect the weather to be a challenge and should be prepared for it.

Qantas Airways’ Marketing Campaign and Social Work during the Pandemic

This is evident from the analysis that the 4P’s have been impacted. The first P that is produced is quite simple that is they provide air travel service. Their whole marketing was done to show the audience that they provide the best rates that are the cheapest in the industry at the same time the most safely (Bartle, Lutte & Leuenberger, 2021). I believe that rather than international flight service they can focus on using their existing business model to offer domestic cheap flights in the USA market.

Price is another factor that can heavily impact any business. For Qantas, the Covid impacted their pricing strategy. Depending on the social and economic aspects of the USA and the financial losses due to the pandemic Qantas should change its pricing strategy for the new market (Heiets, Oleshko & Leshchinsky, 2021). Many tickets were canceled and a full refund was issued which was a massive loss for them. I think that in the best interest of the brand instead of premium pricing they should allow various special discounts and the overall price to be reduced so that people can afford the air services. When everyone in the post-pandemic era is trying to recover this will be a good chance for Qantas to capture the majority market by selling tickets at the best rates later they can make adjustments. I believe this is the pricing strategy they should obtain (Marketing Mix Report for Qantas, 2022).

Promotion is something that Qantas has always perfected; they keep on changing their methods and techniques to match the audience. In this case, I believe that the USA is the most progressive western nation hence promotional activities can rely on social media (Team, 2022). The customer base in the USA is perfect to be approached via various social media platforms hence promotional activities via Facebook, Instagram and YouTube as digital mediums are perfect.

When it comes to placing their products and services are acquired from their website and social media platforms as people upload pictures they get to be known (Arrigo, 2018). However, tourism agencies are also places where the customers are made aware. I would always check tourism agency websites for tour packages or those third-party companies that allow getting flight tickets for a relatively lower rate. Hence on entering the USA market they should onboard themselves with such companies so that people both tourist and corporate or normal traveling requirements people get to know the rates and other offers and their services.

A diversified and bigger customer base is by far one of their biggest strengths as there will be more different kinds of needs and demands for every culture customers to travel hence the popularity of Qantas is relatively high as people acknowledge diversification (Xian, 2018). A significant increase in the demand for flights has occurred due to the pandemic as Qantas has convinced people through their marketing that traveling by them is by far the safest option in the post-pandemic scenario. On all their flights they try their best to promote tourism on entering the USA market they have to do the same which acts as a motivator and attraction hence strong branding and marketing happens to be a perfect strength.

Qantas Airways’ Restructuring and New Safety Measures during the Pandemic

In my opinion for a developed nation like the USA competition for any industry will be high. Even though Qantas is a big player in the market. players like American Airlines, Jet Blue, and Alaska airlines are tough competitors and they have been in the market for a long time so even though Qantas has the financial capability these companies are still majority shareholders hence dominating the domestic travel can be tough (Travel + Leisure, 2022). They may have been the top brand in Australia but in the USA they have very less brand recognition meaningless trust and a customer base. They are currently following premium pricing and the rest of the domestic flights providers in the USA follow the budget travel price model, hence Qantas needs to adjust their prices for a more budget-friendly customer base (Zhang et al., 2021).

From the international or rather premium flight model, I believe if they can change their business model to regular domestic flights or short distance flights with rates that are cheap or standardized then they will have a regular traveler customer base and operate domestic regular flights at a high frequency which is inclined with their 5-year business recovery plan. They can straightforwardly start another completely different segment of cargo flights that will deliver cargo to various destinations for people and businesses.

There can always be another pandemic situation that they may not be ready to handle with nature deteriorating the natural calamities are also a valid threat. In my opinion, the political global situation can be the most fearsome threat for example the recent Russia Ukraine conflict that can affect all business globally. Also, the western brands have a dominating culture so if they cannot compete properly and suffer huge losses then the big players in the USA market may aggressively acquire the brand or its US operations which is most certainly a threat I believe they should worry about.

Conclusion and recommendation

It is safe to conclude that the USA market is perfect for the expansion as they have a wide customer base and more than enough demand. All that is required for them is to do proper marketing. I would recommend that based on the customer base they can do two marketing campaigns. One is a launch campaign along with a video campaign midyear using digital media. Using social media for the launch campaign along with a newspaper banner for the first couple of weeks then moving on to YouTube videos or perhaps trying to sponsor some event as the USA citizens notice the sponsorship a lot for their major events. These two recommendations are perfect methods of marketing that can make sure that they have a good launch and a successful business ahead. 

Reference

Arrigo, E. (2018). Social media marketing in luxury brands: A systematic literature review and implications for management research. Management Research Review.

Atay, M., Ero?lu, Y., & Ulusam Seçkiner, S. (2021). Investigation of breaking points in the airline industry with airline optimization studies through text mining before the covid-19 pandemic. Transportation Research Record, 2675(5), 301-313.

Atay, M., Ero?lu, Y., & Ulusam Seçkiner, S. (2021). Investigation of breaking points in the airline industry with airline optimization studies through text mining before the covid-19 pandemic. Transportation Research Record, 2675(5), 301-313.

Bartle, J. R., Lutte, R. K., & Leuenberger, D. Z. (2021). Sustainability and air freight transportation: Lessons from the global pandemic. Sustainability, 13(7), 3738.

Cai, T., Hu, Y., & Li, X. (2022, March). American Airline Industry Under COVID-19 Pandemic–using Delta as a Typical Case. In 2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022) (pp. 2186-2192). Atlantis Press.

David, J. (2018). PESTEL analysis of Australia. How and what. Recuperado de https://www. how and what. net/pestle-analysis-Australia.

David, J., Rahman, M., & David, J. (2022). PESTEL analysis of the USA (USA Country Profile). Retrieved 20 April 2022, from https://howandwhat.net/pestel-analysis-usa/

Heiets, I., Oleshko, T., & Leshchinsky, O. (2021). Airline-within-Airline business model and strategy: a case study of Qantas Group. Transportation Research Procedia, 56, 96-109.

Knorr, A. (2019). Big data, customer relationship, and revenue management in the airline industry: What future role for frequent flyer programs?. Review of Integrative Business and Economics Research, 8(2), 38-51.

Marketing Mix Report for Qantas. (2022). Retrieved 20 April 2022, from https://ukdiss.com/examples/qantas-marketing-mix-report.php

Mustapha, N. N. S. N., Yazid, M. F. M., & Shamsudin, M. F. (2020). How airline industry may rise post covid-19 pandemic. Journal of Postgraduate Current Business Research, 1(1).

Team, M. (2022). Qantas Marketing Strategy & Marketing Mix (4Ps) | MBA Skool. Retrieved 20 April 2022, from https://www.mbaskool.com/marketing-mix/services/17372-qantas.html#:~:text=Marketing%20Strategy%20of%20Qantas%20analyses,pricing%20approach%2C%20promotion%20planning%20etc.

The Top 5 Domestic U.S. Airlines. Travel + Leisure. (2022). Retrieved 20 April 2022, from https://www.travelandleisure.com/worlds-best/domestic-airlines-in-us.

Xian, W. (2018). Case Study on Qantas of ITS Strategic Management: The High Flyer of the Airline Industry.

Zhang, G., Law, C. C., Zhang, Y., & Yang, H. (2021). Price discrimination and yield management in the airline industry.

Order an Essay Now & Get These Features For Free:

Turnitin Report

Formatting

Title Page

Citation

Outline

Place an Order