Background: Qantas is Australia’s largest domestic and international airline. It also owns Jetstar, the budget-friendly carrier for travellers who don’t need full-service perks (or a complimentary biccy and tea). Together, Qantas and Jetstar have over 60% of Australia’s total domestic aviation market - with Virgin Australia, holding over 30% market share.

What happened: Now, Qantas wants to lure Virgin Australia customers back to Jetstar by using the Qantas Frequent Flyer program as bait. For a $199 annual membership, Jetstar passengers will be able to earn Qantas Frequent Flyer status credits and points at the same rate as Qantas flights.

What else: Qantas claims the move is about giving more travellers access to points and status… but it also conveniently strengthens Qantas’ dual-brand grip on both ends of the market as it squeezes Virgin from the top and bottom at the same time.

What's the key learning?

💡A dual-brand strategy is when a company uses two distinct brands to target different customer types in the same market. It lets companies play in both premium and budget categories without diluting either brand, while experimenting with different service models.

💡Qantas and Jetstar are a textbook example of a dual-brand strategy, and they're not alone. Singapore Airlines uses the same play: it owns Scoot, and passengers can earn KrisFlyer points across both airlines.

💡Jetstar flew 19 million passengers in 2022, meaning 19 million more opportunities to pull people into the Qantas Frequent Flyer ecosystem. By capturing both high- and low-end travellers through one loyalty program, Qantas leaves single-brand rivals like Virgin fighting for a shrinking middle ground.