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QANTAS AIRLINES: TWITTER NOSEDIVE1
Paul Bigus wrote this case under the supervision of Professor Jana Seijts solely to provide material for class discussion. The
authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised
certain names and other identifying information to protect confidentiality.
Richard Ivey School of Business Foundation prohibits any form of reproduction, storage or transmission without its written
permission. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies
or request permission to reproduce materials, contact Ivey Publishing, Richard Ivey School of Business Foundation, The University
of Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail cases@ivey.uwo.ca.
Copyright © 2012, Richard Ivey School of Business Foundation
Version: 2012-11-26
On Thursday, November 24, 2011, Olivia Wirth, executive of Government and Corporate Affairs, at
Qantas Airlines (Qantas), faced a communication situation that was spiralling out of control. A day
earlier, on Wednesday, November 23, 2011, Qantas had launched a public contest through the social
media service Twitter that offered participants a chance to win one of 50 pairs of Qantas first-class
pyjamas and a luxury amenity kit.2 To enter, Qantas asked participants to use the Twitter hashtag
#QantasLuxury to describe their “dream luxury inflight experience.”3 However, the timing of the public
relations exercise was questionable. Qantas had experienced a turbulent year inundated with problems,
including a series of aircraft engine troubles, controversial photographs, bitter contract negotiations with
its three unions and the stranding of thousands of customers after having grounded its entire fleet.4
Upon launching the contest, the competition quickly diverted in an untended direction, as thousands of
people hijacked the Twitter hashtag to express negative comments about Qantas. To make matters worse,
Qantas appeared to not be actively monitoring the statements, as the company’s comments thanked users
for their entries, tweeting, “Wow! Some very creative tweets out there. Keep the entries coming.” Public
discontent with the airline was also expressed through a viral YouTube video parody criticizing Qantas
chief executive officer (CEO), Alan Joyce, and the senior management for their inability to understand
how to communicate with the public.5
With public animosity toward Qantas continuing to increase, Wirth needed to devise a plan of action
before the company further jeopardized its reputation as the world’s leading long-distance airline and one
of Australia’s strongest brands.6
1
This case has been written on the basis of published sources only. Consequently, the interpretation and perspectives
presented in this case are not necessarily those of Qantas Airlines or any of its employees.
2
Daniel Miller, “Qantas Twitter Campaign Takes Nosedive,” ABC News, November 23, 2011,
http://www.abc.net.au/news/2011-11-22/qantas-twitter-hashtag-backfires/3686940, accessed November 4, 2012.
3
Ibid.
4
Rob
Taylor,
“Epic
Fail
for
Qantas
Twitter
Competition,”
Reuters,
November
22,
2011,
http://www.reuters.com/article/2011/11/22/uk-qantas-twit-idUSLNE7AL00U20111122, accessed November 4, 2012.
5
David Glance, “#QantasLuxury: A Qantas Social Media Disaster in Pyjamas,” The Conversation, November 23, 2011,
http://theconversation.edu.au/qantasluxury-a-qantas-social-media-disaster-in-pyjamas-4421, accessed November 4, 2012.
6
Qantas, “The Qantas Story,” http://www.qantas.com.au/travel/airlines/history/global/en, accessed November 4, 2012.
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QANTAS HISTORY7
The origins of Australia’s famous airline, Qantas, first began in 1919, when two former Australian Flying
Corps officers, W. Hudson Fysh and Paul McGinness, accepted an assignment from the Australian
Defense Department to survey an air race route from Longreach in Queensland to Katherine in the
Northern Territory. In a Model-T Ford, the pair travelled for 51 days, over a distance of 2,179 kilometres
through areas never before crossed by a motor vehicle, surveying and leaving supplies along the route for
the air race competition. Over the duration of their strenuous journey, Fysh and McGinness realized the
potential to link the remote outback settlements of Australia. Upon completing their assignment, the pair
sought to obtain financial backing to operate an air service. With the support of wealthy grazier, named
Fergus McMaster, and his acquaintances, who understood first-hand the difficulty of travelling in
Australia’s outback, Fysh and McGinness secured the capital investment they needed. Attaining the
services of their former military flight sergeant, Arthur Baird, as an aircraft mechanic, the small team
ordered two aircraft from the Mascot Aerodrome in Sydney. A few months later, on November 16, 1920,
under the name of Queensland and Northern Territory Aerial Services Limited, abbreviated as Qantas, the
small airline company was officially established in the town of Winston.
During the first few years of business operations, Qantas provided joy rides and air taxi trips. In 1922, the
company expanded operations to include a small scheduled airmail delivery service from Charleville to
Cloncurry. The 1924 acquisition of new aircraft equipped with an enclosed cabin allowed Qantas to offer
passengers increased comfort in flying without the need to wear a helmet and goggles. Recognizing
additional service opportunities, in 1928, Qantas signed a contract to help operate The Australian Aerial
Medical Service, earning a fee of 40 cents8 for each mile travelled. Over the duration of the following
year, a two-man team consisting of a pilot and a doctor travelled more than 28,000 kilometres to treat 255
patients. As the business continued to expand, by adding air routes stretching over 2,380 kilometres,
Qantas moved its headquarters to Brisbane in 1930. Soon after, the company entered into a partnership
with Britain's Imperial Airways, as part of an experimental Australia–England run, with flights
connecting airmail shipments in Burma. With the acquisition of more contracts each year, Qantas
achieved a significant milestone in 1934, operating its first overseas passenger flight from Brisbane to
Singapore. To meet growing demand, Qantas invested in a series of Short C Class Empire flying boats,
allowing for 15 passengers per flight. With the flying boats’ convenient use of water surfaces for takeoffs
and landings, Qantas was able to establish a base at Rose Bay in Sydney, a location that would officially
become company headquarters to in 1938.
During World War II, the Australia–England route Qantas operated became a vital line of
communication. As enemy forces advanced south through the islands, many passenger routes were halted.
With aircraft in high demand, more than half of the Qantas fleet was commissioned by the Australian
Government for war service. After the war, Qantas started to rebuild and modernize its fleet, obtaining
new long-range, pressurized aircraft. In 1947, the company was removed from private ownership when
the Australian government acquired all remaining shares. The airline continued to experience significant
growth, not only in routes and destinations but also by expanding from traditional propeller-driven
aircraft to advanced jetliners in 1956. A year later, Qantas would open a new 11-storey head office in
Sydney, to be occupied by nearly 1,000 staff members. With the introduction of the Boeing 747-238B
Jumbo Jet in 1971, passenger traffic and revenue grew substantially, as Qantas expanded services to offer
customers a range of low fares and scheduled services. Qantas also achieved expansion through the
successful acquisition of other airlines. In 1992, the Australian government approved the bid by Qantas
7
8
Ibid.
All currency amounts are represented in Australian dollars unless otherwise stated.
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for rival Australian Airlines, positioning Qantas as Australia’s major airline. During the same year, the
government also announced that Qantas would once again become a fully privatized airline.
Over time, Qantas had become famous for the use of a kangaroo symbol appearing on all its aircraft. The
symbol was originally adapted from the Australia one penny coin. In 1944, the kangaroo was first painted
on an aircraft flying over the Indian Ocean passage to which Qantas had appropriately named, the
Kangaroo Service. Although the Qantas kangaroo logo would undergo various representations over the
years, it became synonymous with Qantas airlines and the country of Australia in airports around the
world. In 2010, after 90 years of successful operations, Qantas had expanded to become Australia’s
largest domestic and international airline, carrying more than 41.4 million passengers each year to 184
destinations in 42 countries, operating an average of 5,300 flights each week.9 The company consisted of
two complementary airline brands, Qantas and Jetstar. Qantas provided a full-service airline that offered
services across a broad network. In contrast, Jetstar represented the company’s low-fare economy airline.
Overall in 2010, the company employed more than 35,700 people in 250 different roles to operate a fleet
of 254 aircraft, resulting in an operating revenue of $13.8 billion.10
TURBULANT TIMES
Despite years of growth and success, Qantas had experienced numerous problems in recent years. On
Monday, August 30, 2010, a Qantas four-engine Boeing 747, which had departed from San Francisco
International Airport, bound for Sydney, was in the air for approximately 45 minutes when an explosion
occurred in the number four engine.11 The pilots immediately turned the plane around and started
dumping fuel over the Pacific Ocean, as a safety measure in case an emergency landing was needed. The
pilots successfully landed the plane back in San Francisco.12 It was only the first of a series of aircraft
engine troubles for Qantas. On Thursday, November 4, 2010, a Qantas Airbus A380 made an emergency
return to Singapore shortly after take-off, when an explosion occurred in one of the aircraft’s engines.
One day later, on Friday, November 5, 2010, a Qantas Boeing 747 en route to Australia was also forced to
turn back to Singapore after experiencing engine troubles.13 Qantas responded by grounding all six of the
company’s Airbus A380s to perform safety checks.14 Nevertheless, the timing of the negative engine
incidents overshadowed Qantas’s 90th anniversary celebrations planned for the month of November
2010.15
The company also suffered a failed publicity stunt when it launched a competition asking people to tell
Qantas via Twitter how they intended to show their support for the Wallabies of the Australian Rugby
Union, in exchange for a pair of platinum tickets to watch the team play at the Bledisloe Cup, on
Saturday, August 27, 2011.16 The winning entry came from Charles Butler, who tweeted “dress as Radike
9
Qantas, “Annual Report 2010,” http://www.qantas.com.au/infodetail/about/investors/2010AnnualReport.pdf, accessed
November 4, 2012.
10
Ibid.
11
Shannon Deery, “US Officials to Investigate Qantas Engine Explosion,” Herald Sun, September 1, 2010,
http://www.heraldsun.com.au/travel/news/qantas-jet-makes-emergency-landing-after-engine-explodes/story-fn32891l1225912603787, accessed November 4, 2012.
12
Ibid.
13
Andrew Marshall, “Qantas A380 Fleet Could Fly Again Within Days: CEO,” Reuters, November 6, 2010,
http://www.reuters.com/article/2010/11/06/us-qantas-singapore-idUSTRE6A435P20101106, accessed November 4, 2012.
14
Ibid..
15
Ibid..
16
Matt Buchanan and Scott Ellis, “Qantas Sorry for 'Racist' Tweet,” The Sydney Morning Herald, August 29, 2011,
http://www.smh.com.au/technology/technology-news/qantas-sorry-for-racist-tweet-20110829-1jh0e.html,
accessed
November 4, 2012.
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