An interview by Adam Posner with Loyalty Leader – Carolyn Pierre Head of Product & Ancillary Revenue (including Club Jetstar) at Jetstar Airways.
This is interview #31 in the series on Loyalty Leaders that I have had the pleasure and privilege of doing.
And this interview, for me, was refreshing.
Carolyn has a focused and direct approach to ensuring Club Jetstar is a successful membership program.
There is no fluffing about in this interview which is reflective of Carolyn’s leadership style (so I can gather).
Her dedication to the membership program is based on a single-minded focus on simplicity and the customer value proposition.
And when it comes to loyalty to her employer (Jetstar Airways) she has been with them for 20 years … that’s impressive!
Enjoy!
1. So, who is Carolyn (outside of work) + a little on your work biography
I'm a Melbournian born and bred and yes, I do love to travel, so it's quite fitting that I work for an airline.
I started at Jetstar in 2004 and as the airline just celebrated its 20th year, I have been there since the beginning of its commercial launch in Feb 2004 and operational launch in May 2004.
I had just finished uni and a few months in Europe backpacking, so I needed a job. I saw an ad for this new airline starting up who was setting up a call centre in Melbourne. I thought, oh, okay, I'll do it for a few months and see what happens, and I'll work out what I want to do with my career while I'm there.
20 years later, I'm still here and it's been an amazing journey.
Comment: A 20-year career at the one organisation is impressive!
I've always worked in various commercial areas at Jetstar. When you're working for a low-cost carrier in the start-up phase, you end up doing a little bit of everything. So, I've done policy writing, training, call centre setup, product setup, and many varied projects.
This is probably the reason I've been here for so long, because it's been so diverse and so different and so exciting, particularly in the first ten years. Every day was different. You have an opportunity to jump into areas you wouldn't normally do or would not be part of your specified job description, and you learn so much through that process.
Now I head up the ancillary and product team at Jetstar across Australia, Singapore and Japan. We manage end to end product for everything Jetstar sells over and above the initial fare. So, all of the additional products you can add to your fare.
That includes Club Jetstar.
2. Tell us about the Club Jetstar membership program. Any stats you can share?
Club Jetstar is a membership program with an annual subscription. Members receive access to exclusive sales and early access to general sales, exclusive member fares and discounts on additional products.
They can use these benefits for themselves and for other people who travel with them.
We recently ticked over 400,000 members across Australia, New Zealand, Singapore and Japan. Australia and Japan are the biggest member bases.
The program was launched in 2014 and was fairly basic. We reviewed and relaunched in 2016 when we only had 20,000 members and then there was the two-year Covid impact. So, we've grown from about 20,000 members to more than 400,000 now.
There's definitely a different travel mindset post Covid than there was pre-Covid in that people are a bit more cautious about travel. They want a bit more reassurance. They want a bit more flexibility. From a Club Jetstar perspective, we do try and keep a pulse of our members in terms of research and feedback and tailoring the benefits to that as we go.
We're working on strategies to reward the retention of members. We do have a lower price for the renewal than we do for the acquisition. That’s a way to incentivise members to renew rather than lapse and sign up again.
It is mostly a consumer leisure-travel member base, but we do see some SME members in our base because they're paying for their own travel. They do benefit more because they're more frequent travellers.
3. What is the most unique element of the program?
I think we have a deliberate strategy of giving members immediate value, and that's what a subscription program should do.
Because we have a minimum one-year relationship with our members and hopefully longer than that, we need to show them what the value is over that year.
And we make the value equation maths easy so members can quickly answer the question - am I going to get the value? We see most members save a lot of money on the sign up.
In in last 12 months, members have saved $59 million in discounts on flights and other products. The value is there.
Besides the value focus, I think another unique part of the program is how we've integrated it into the customer journey on our website when people book.
It's easy to sign up when you book your flight. Most members do sign up this way.
We do the maths for them to make the decision easy. It's all done for them based on their booking. An online calculator brings this to life.
Comment: Adding the calculator makes the mental gymnastics easy - no more ‘mathletics’ for members!
4. If you had to choose the most important measures of success for your program, what would they be?
There are two for us:
1. Member growth
I think member growth comes from the back of a really strong Customer Value Proposition (CVP). If the value is there, the customer will subscribe.
2. Member retention
This measure of success is key for a yearly subscription program. I think it's much more challenging in the travel industry where travel is an infrequent purchase, and most people don't travel for leisure more than once a year. Although Club Jetstar members do travel a lot more frequently.
I think everything falls out of those two measurement streams including program design and management.
5. What are some of the challenges you face on an ongoing basis to keep the program relevant/fresh/thriving (internally and externally) and how do you overcome these?
I think the biggest challenge, as mentioned, is that travel is not a frequent purchase. When people are traveling once a year or even less, this makes the audience size smaller and more difficult to engage with on an ongoing basis.
This is an opportunity and a challenge. We have noticed the program motivates additional travel as it inspires members to travel more because they get more value, the discounts on the bookings.
Even those Jetstar customers who don't travel frequently are signing up because they're saving on just one booking. We've had scenarios where people have saved $1,000, $2,000 on one booking, for only a $65 subscription fee. That’s a no brainer maths equation.
I also think the huge advantage we have is that travel is exciting. It's an inspiring product to talk about. Members like hearing from us on how they can save more money on travel. It's a motivating reason for them to open an email.
We don't really have that many challenges internally. We have strong membership and cross-functional teams across the business who work on Club Jetstar together.
We all understand the goals. We all know the customer benefits.
It's easy for everyone to be aligned on the same strategy because everyone believes in the benefits. I think we do a really good job working together with cross-functional teams to ideate, learn, test, and keep it growing.
6. If you could start again with a blank strategy canvas, what would you do differently?
I reflected a bit on this question, and I think, honestly, nothing.
I was discussing with my team recently about whether, as a business, we make decisions based on gut feeling, belief or hard data as the two ends of the decision spectrum.
And generally, it's a bit of a mix of both, but it really leans towards that hard data end, which I imagine would be the same for most companies.
For Club Jetstar when we decided to redesign in 2016, it was a bit of a leap of faith, and we redesigned it based on a belief and a lot of assumptions. There was no hard data.
We designed it based on what we believed would be a strong customer proposition. That was the strategy. And we made that work commercially.
And we had good engagement from an executive level, and so we just did it.
So honestly, I wouldn't change anything because I think you always need to start with that strong CVP, and you make everything else work around it.
7. What advice would you give to brands thinking about a loyalty program?
1. Start with a strong CVP and build from there. If the CVP doesn't exist, don't bother going any further. Test that CVP.
2. You really need to know your customer. We can all sit in a meeting room and ideate about what customers want and we have probably all done it before. I'm guilty of that, too. But it's all irrelevant if you don't actually know your customer. So, it's getting out there asking them questions, understanding them, because it might be the opposite of what you're thinking.
3. The only other one would be just don't overthink it. You can get caught up in knots trying to design things and prove things. If it feels right, launch it.
8. What’s the biggest frustration you have with loyalty programs?
I think the biggest frustration for me is when it's obvious the program has been designed for the business, not the customer.
I've seen some weird, convoluted customer facing spend and reward structures that look like they came straight out of a finance model.
And when I read it, I can't understand it.
I think a program needs to answer the question. What's in it for me, the customer? If you can't answer that quickly, you've already lost my attention.
Just keep it simple.
9. What do you think is creeping up on programs that could disrupt them for better or worse?
Automation is an interesting one. I guess that's not really creeping. It's already here. But there are levels of automation that you can get to. And I think the potential disruption part is the balance of automation versus human thinking.
There's a lot of opportunity in terms of automating data learning algorithms and models which I think are great and an interesting opportunity to learn and optimise.
But you always need a human driving all of that thinking.
I think the risk is that programs will get addicted to the efficiencies of it, and you lose that human control and that human thinking around it.
I think it’s both an opportunity and a risk.
Comment: I love the quote: “I think the risk (of automation) is that programs will get addicted to the efficiencies of it, and you lose that human control and that human thinking around it.”
10. What’s the most underestimated force behind a program’s performance?
I think it's people. Passionate people.
You need a passionate team to build a program and drive it. People who believe in what they're doing and understand why they're doing it will be successful and so will the program.
I've been lucky to lead a passionate team of incredible product managers who are driving it and thinking about it and owning it and loving it. I think you need that.
11. What are three important skills a loyalty program marketer needs?
1. It's that passion. Believe in your program and what it stands for. Be passionate about what you're doing every day. You need to get out of bed and want to come to work and be excited about it.
2. Curiosity. Have that innate curiosity to ask questions and challenge things. Why is this like this? What will happen if I change it? How could I change it? How can I think differently about it? Be confident enough to be curious about what you're doing.
3. Be loyal to your members. Knowing that you work for your member base, you need to constantly be thinking about who your people are. I think when a program gets big it's easy to sometimes unintentionally erode bits and pieces around the edges and suddenly break down your CVP.
You need to violently defend your CVP to keep it strong. It's very tempting to get a little bit of extra conversion or acquisition or revenue or cost savings here and there. But you've always got to go back to that CVP and go, what is this going to do to my members? Would I want this to happen?
Comment: These insights were very refreshing. It's the first time in all the Loyalty Leader interviews I've had “be loyal to your members”. Thank you!
12. If we are chatting again in (say) 2 years’ time, what do you predict would be the hot topic related to loyalty programs?
A topic that is part the current moment and will be in the future, is personalisation and micro segmentation. I'll be interested to see where that goes in two years. I believe it's going to get bigger and better.
It comes back to the balance of automation and the human when you're personalizing. Do you get down to a 1 to 1 personalisation? How small do you make the segmentation?
I don’t think we're there yet. We're doing some work on platforms and technology to really set us up to get there, to do it well, to be able to know more about that end-to-end life cycle of the member.
13. Leave us with a lasting loyalty thought
Summary
This interview provided some salient reminders on what makes a subscription membership program successful along with some pearls of wisdom from Carolyn’s 20 years’ experience.
My favourite five are:
1. Be true to your CVP:
"I think we have a deliberate strategy of giving members immediate value, and that's what a subscription program should do. You need to violently defend your CVP to keep it strong."
2. Be simple:
"I think a program needs to answer the question. What's in it for me, the customer? If you can't answer that quickly, you've already lost my attention. Just keep it simple."
3. Be loyal to your members:
"Knowing that you work for your member base, you need to constantly be thinking about who your people are."
4. Automation vs humanity:
"I think the risk (of automation) is that programs will get addicted to the efficiencies of it, and you lose that human control and that human thinking around it."
5. Advice to brands thinking of a program:
"Just don't overthink it. You can get caught up in knots trying to design things and prove things. If it feels right, launch it"
Thanks Carolyn!
Have a happy loyalty day
