Virgin is hunting for diversification and it has its eyes squarely set on its loyalty program Velocity Frequent Flyer as a hub for it. The airline has announced it has acquired data analytics business Torque Data and appointed a new CEO as it looks at opportunities in third party services.
North Sydney based Torque provides predicative analytics, intelligent campaign automation and data visualisation services and will be integrated into the Velocity business.
The move follows Qantas' data push Red Planet.
Virgin Australia Group CEO John Borghetti said the acquisition is an important step as it looks to achieve growth.
“Velocity Frequent Flyer is a significant value driver for the Virgin Australia Group and we are focused on fast-tracking its growth to create one of the world's leading loyalty programs,” Borghetti said.
“Torque Data will enable the Virgin Australia Group to significantly expand its data analytics and campaign automation capabilities, supporting the accelerated growth of the Velocity business by enabling us to deliver more value to members and partners.
At the helm of this growth with be newly appointed CEO of Velocity Karl Schuster who will start with the company on 1 October.
Schuster has more than 30 years' experience in loyalty and marketing and was most recently president Asia Pacific at marketing and loyalty analytics company Aimia.
He also was previously the managing director and then president of Asia Pacific at Carlson Marketing Group and spent 10 years working with and eventually leading the OgilvyOne business in Cape Town, South Africa.
Part of the way Virgin is pinning its growth hopes on Velocity is by opening up a new revenue stream by appealing to opportunities with third parties meaning, like Qantas, Virgin hopes to offer its loyalty services to other companies.
Borghetti said: “The acquisition also provides another revenue diversification opportunity for Velocity and the Group, as it will enable the business to offer data analytics, campaign automation and consultancy services to third parties.”
Torque data CEO Oliver Rees said the acquisition will boost its capacity to service its exciting cleints while adding value to the Virgin Australia Group.
Virgin isn't the first airline to use the substantial data from its loyalty program to build a diversified revenue stream with third party clients. Qantas launched Red Planet – its data powerhouse - in September 2014 with the ability to services external clients using its vast data pools.
Qantas Loyalty insights and innovation Vaughan Chandler told AdNews in March that the campaigns it ran were four time more effective than traditional campaigns.
He also noted that campaigns for non-Qantas clients also saw significant improves in ROI thanks to the data it can draw on.
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