United Breaks Guitar

Submitted by: Group 6Anindya Bhadra (09IB-005)Bhaskar Mehta (09IB-013)

Bhuvan Mudgal (09IB-014)Geetika Munjal (09IB-023)

Jasjit Banga (09IB-028)Manik Bhalla (09IB-030)

Nikhil Roongta (09IB-033)Rohan Agarwal (09IB-047)

About United Airlines

• One of the largest international airlines in US• Has over 3,300 flights per day• 50,000 employees and 360 aircrafts• United Airlines flies to 73 domestic destinations and

41 international destinations in 25 countries across Asia, Americas, Europe, Oceania, and Africa

• In May 2010, the board finalised the merger of Continental Airlines and United Airlines making them world's largest airline in terms of revenue passenger miles

The IncidentMarch 31, 2008- Dave Caroll along with band members Sons of Maxwell, travelling from Halifax to Omaha

At halt point in Chicago- rough handling of cargo by United baggage handlers witnessed

Caroll approached flight attendant, advised to contact ground crew at Omaha

No ground crew available at arrival in Omaha because of flight delay

At Omaha advised to start claim at Halifax

The Incident (contd.)In Halifax, given a number directed to a call centre in India

Through the call centre directed to United’s office in Chicago

At Chicago, asked for the guitar for inspection

Finally, Caroll got an email message from a United’s representative after 7 months stating the airline policy that claims should be made within 24 hours of damage.

The Incident (contd.)

“At that moment”, wrote Caroll in his blog,” it occurred to me that I had been fighting a losing battle.. The system is designed to frustrate affected customers into giving up their claims and United is very good at it.”

Caroll decided to write three songs with video about United Airlines and share on You Tube.

Goal- to get one million hits in one year

Within four days of the song going online, the gathering thunderclouds of bad PR caused United Airlines’ stock price to suffer a mid-flight stall, and it plunged by 10 per cent, costing shareholders $180 million. Which, incidentally, would have bought Carroll more than 51,000 replacement guitars

UNITED’s Online Presence

• United had a presence on in both online and social media.

• In micro-blogging site Twitter, they had approximately 18000 followers

• Tweeted two to three times a day• Gave away information useful to travelers like airfare

deals and system disruptions• Employees were encourage to monitor social media

Responses of United AirlinesDate & Time

Situation Action Response on Twitter

July 7, 12:00 PM

Tweet from Carroll’s Friend“psssst..@United Airlines breaks Guitars”

Robin Urbanski made a call to Carroll after approval from Rob Bradford. Carroll not available

“This has struck a chord with us and we’ve contacted them directly to make it right”

July7, 1 PM to 10 PM

Taunts from some of Carroll’s friends

They decided not to respond on Twitter

No response

July 8 Carroll was called and compensation was offered.

Many Responses, given on next slide.

September 14

Face to face meeting between United Airlines and Dave Carroll.

Responses from United

Did the Airline handle the incident well?

“Negative buzz about your company is not something to be squelched but

rather an opportunity to regain control of the agenda.”

United’s Mistake• Issued a sincere apology, sprinkled in some humor, and even came out and

said that they wanted to use this video for Training Purposes• United was selective in the type of media they used to respond to the

incident.• While they answered journalist queries, they did not address it on its

website or on its You tube channel• Next day another video was updated on YouTube with Carroll

acknowledging the apology but only 200,000 people viewed it which was actually only 5% of the people watching the other one

• Should have issued their own humorous You Tube response• The airline’s belated decision to donate $3,000 to the Thelonious Monk

Institute of Jazz as a gesture of goodwill (Carroll said he was beyond the point of accepting money) did nothing to contain the damage.

Moral of the story

“It is possible to rescue a damaged corporate reputation, but only if the company engages with Social Media as a form of response”

Service recovery• A problem resolved within a reasonable time, together with information on

how the failure occurred and what is being done to make sure it doesn’t recur• Successful service recovery requires

– empowered employees– a strong customer orientation– celebrating success stories– systematic data collection– meaningful incentives to encourage such behaviour

It should be invisible. No matter what method of service recovery you choose, it is critical that you present in such a way that it is not obvious to the customer that you are doing this just to retain them as customers. While some will see through your methods, most will be happy to be treated with respect and dignity!

Learn from R

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Act

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Treat Customers Fairly

Fail-safethe Service

Cultivate Relationships

with Customers

Encourage and Track

Complaints

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ServiceRecoveryStrategies

The ideal response

Why so many views for the video

Some interesting facts• Approximately 15-16% of Tweets about United Breaks Guitars were

retweeted, compared to a Twitter average of approximately 9%.• 86% of Tweets about United Breaks Guitars referenced web

addresses, compared to a Twitter average of approximately 40%.• The top tweeters pertaining to United Breaks Guitars for the month

of July were GuitarForever(129), GuitarSafes (50), and jenghauser (30).

• The top 3 user handles that tweeted about the incident for the month of July were mashable(1,080,653), adventuregirl (800,229), and zoecello (697,603).

• The top 3 user handles that were retweeted the most were mashable (121), DaveCarroll (28), and shelisrael (25).

• Total number of online news stories for the month of July: 625.

Some interesting facts• Total number of blog postings pertaining to United Breaks

Guitars for the month of July: 1,662.• Total number of tweets pertaining to United Breaks Guitars for the

month of July: 5,980.• For the month of July, next to the actual link to the YouTube video,

the link to the mashable blog was the most referenced with 271.• The most referenced hash tag or group was united.• The top three mentioned words were united, breaks, and guitars.• Total amount of views for United Breaks Guitars for the month of

July: 4,524,334.• The United Breaks Guitars issue represented 42% of all online

news for United Airlines for the month of July.

The graph shows the different media and how they could be potentially influencing each other and driving traffic to the YouTube video. Notice how blogs tend to be the early influencers. However, traditional media, in this case represented by online news, seems to have a more profound influence both on Twitter and in driving traffic to YouTube. That said, it is possible that even though online news is influencing Twitter, Twitter in turn could be influencing YouTube through posted links. It should also be noted on the chart that clearly online news from the UK and Ireland around July 23 had an effect on Twitter. Again, this was backed up by the volume of posted links originating from UK sites in Twitter. Furthermore, views on YouTube also increased around this time.

Viral Marketing

• Technology has reached a point where everyone has a voice. This voice, articulated through social media, can be extremely powerful and can force individuals, companies and communities to change the way they behave.

• It is not who is influential that counts but who acts as a catalyst for conversation – Keith O’Brien

• Calculating an individual’s online influence is becoming more important each year as people seek advice from their peers on the Internet regarding what they should think, buy and say.

• The Social Media Index is a model, which recognises and attempts to quantify the impact and influence of multiple social media tools.

“It's been said that in the ‘old days’(maybe only a decade ago) that people who had a positive customer service experience would share that with three people. If they had a bad experience, they would tell 14. Clearly, bad news travels fastest and that hasn't changed. But today, social media tools like Face book, Twitter, MySpace and YouTube ensure that news travels exponentially”- Dave Caroll

Strategies for Corporate

Route to Successful Customer Communication

• According to the latest survey from Opinion Research Corporation, a large proportion, 84%, said that browsing reviews influenced their decision on whether or not to purchase a product or service.

• Hence, reach out to those who have had a bad experience and ask for a second chance.

• Rather than taking a reactive approach to ratings and reviews, be an active participant in the online consumer dialogue

• Encourage your customers to review your business.

• The more positive comments prospective customers read about your business, the less influence any negative reviews will have.

Route to Successful Customer Communication

• Two words that should never be used in customer service- Statistical Insignificance.

• The vision of “mostly right, most of the time” has changed to “get it right every time”

• Their philosophy starts with the fact that all customers deserve a positive experience -- not most customers, but every one of them

Measuring Social Media Exposure

Communication Collaboration Strategy

• Currently, most marketing communication programmes sit in on the left hand side of this matrix.

• However, as companies and organisations become more aware of the tenor of each venue and what works, they will begin to mix in strategies and tactics from the right side.

• As a result, the outcome is that programmes on the left will measure online influence through metrics like impressions, conversations, in-bound links, friends and more.

• Meanwhile, the right hand side - particularly Conversational Collaborative programmes - will adopt entirely new methodologies that measure based on outcomes.

• For example, this could include ideas generated, donations or other means of measuring advocacy and so forth.

• The future of communications is in the mixing of these quadrants and understanding how they work together to influence the public.

Communication Collaboration Strategy

Steps for Online Reputation Management

Monitor• Set up Google and Yahoo Alerts

to catch the use of your brands in the news.

• Use sites such as Feedster and Technocratic to watch your brand in blogs.

• Customize RSS readers for brand tracking.

• Track for all names including brand names, company names, product names, and key employee names.

• Monitor industry-related sites

Analyze• Corporate Sites• Sister Sites and Micro-Sites

(other sites from your organization)

• Product Sites• Corporate Blogs• Employee Blogs• Partner Sites (supplier sites,

recruitment sites)• Corporate Communications

(press releases, articles)

Influence• Sources of Potential

Reputation Problems, Sources of Opportunity• Blogs, Forums, and

Consumer Opinion Sites• Consumer Complaint Sites• Social Network Sites• Competitor Attacks• Trademark Infringement• Counterfeit Products• Counter-intelligence• Crisis Management

Developments

Behavior for employees handling customers

• Acknowledgement - Acknowledging that a problem has occurred• Empathy - Understanding the problem from a customer’s point of view • Apology - Saying sorry • Own the problem - Taking ownership of the customer and the issue • Fix the problem - Fixing, or at least trying to fix the problem for the

customer• Provide assurance - Providing assurance that the problem has

been/will be sorted and should not occur again • Provide compensation - Providing a refund, and/or a token and/or

compensation, depending on the severity of the problem