Qantas Wine sales increased by 74% in the second half of 2020, compared to the same period a year earlier, with Qantas attributing the record increase to “shifts in consumer behaviour during lockdown”.
The revenue from Qantas Wine was the highest it has ever been, taking into account both cash sales and frequent flyer point redemptions.
With fewer opportunities for Qantas Frequent Flyer members to redeem points for travel, the Qantas Rewards Store also saw a 41% increase in revenue over the same period.
Although an obvious conclusion would be that the COVID-19 lockdowns drove lots of Aussies to drink more, there is a little bit more to the story. In fact, Alcohol Beverages Australia says that overall alcohol sales in the country were flat last year.
What has changed, however, is the amount Australians are drinking at home. While many pubs, bars and restaurants remained closed or had to operate at a reduced capacity last year, many Australians purchased takeaway alcohol instead. Some also preferred to drink at home due to concerns about attending crowded venues. This trend, combined with a surge in online shopping during the pandemic, proved a winning combination for Qantas Wine.
Other online wine retailers have also seen increases in sales during the pandemic. But for many Qantas Wine customers, the generous bonus point offers sealed the deal. With Qantas Wine, it’s possible to earn as many as 20,000 Qantas points – enough for a return domestic flight – with a case of wine that costs as little as $400! And no, the wine doesn’t generally cost much (if any) more than you’d pay elsewhere.
The record Qantas Wine sales contributed to a $125 million profit in the first half of the 2020-21 financial year for the Qantas Loyalty business. However, Qantas Loyalty’s overall profit was down. The increased wine, insurance and Qantas Rewards Store sales didn’t quite make up for the loss of revenue due to lower spending on Qantas points-earning credit cards in Australia.
“Qantas Loyalty still had significant income because the program has evolved to the stage where the vast majority of points are earned from activity on the ground,” Qantas CEO Alan Joyce said on Thursday.
Qantas Loyalty, along with Qantas Freight, were the two bright spots for the Qantas portfolio of businesses during a period where the airline has posted an overall half-year loss of more than $1 billion. Qantas estimates that it lost a staggering $6.9 billion in revenue between July and December 2020 – a drop of 75% – due to COVID-19.