Qantas and Tourism Australia have finally kissed and made up with a $20 million deal

Qantas CEO Alan Joyce and Tourism Australia managing director John O’Sullivan

The four-year breakup between Qantas and Tourism Australia is over with the duo announcing a three-year $20 million deal to promote Australia globally today.

Qantas CEO Alan Joyce and Tourism Australia managing director John O’Sullivan hailed the agreement as “a new era of partnership”. Relations appeared to thaw earlier this year when the airline released a new safety video highlighting popular tourism destinations in a joint venture with the national tourism body.

The fall out between the two businesses dates back to 2012 when Joyce’s predecessor, Geoff Dixon, was Tourism Australia’s chairman. The airline was at a low point and Dixon was part of an investment group lobbying to force a change the ultimately successful strategic direction Joyce had set. The Qantas boss wanted Dixon to step aside from the tourism authority over the conflict of interest and it was a spectacular and public falling out between Joyce and his former mentor.

The breakdown of the 40-year partnership cost Tourism Australia $44 million – around half the airline’s annual marketing budget. For the next three years, Qantas spent its tourism marketing budget with state tourism authorities rather than the national body. It will continue to support the state bodies as part of an $80 million budget that’s over-and-above the airline’s direct and branded advertising.

The joint marketing campaigns will have a digital focus, concentrating on the United States, Asia, United Kingdom and Europe, and also includes an anonymised data sharing arrangement.

Alan Joyce said the two sides wanted the same thing – “a strong tourism industry that makes Australia the first choice for people all over the world”.

In the past year Qantas brought more than three million international visitors to Australia, with double digit growth in the Asian market.

“This new investment builds on the marketing we already do and our partnerships with state and territory governments to put Australia’s best foot forward,” Joyce said.

O’Sullivan said he was pleased to be back in partnership with Qantas.

“The plans we have around data sharing are particularly exciting, allowing us to be more efficient and effective with our advertising but also enabling us to provide consumers with a much more relevant and personalised online experience,” he said.

A recent Deloitte Access Economics report found that in 2014/15, Qantas facilitated $9.5 billion in tourism expenditure in Australia, or $1 in every $9 spent.

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