United We Care

8/14/2019 United We Care

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United We Care

Crisis Comm. Plan by Finnerty, Komjati, Lyles, Magliocca


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Challenge/Situation Analysis:

United Airlines (UAL) aces a challenge o mitigating damage that could arise rom negative exposuregenerated by a disgruntled customer.

Musician Dave Carroll was ying rom Nova Scotia to Nebraska by way o Chicago OHare with UALWhile on the tarmac at OHare, Carroll and his bandmates saw baggage handlers throwing around guitars

on the tarmac. He immediately complained to three ight attendants who responded with indierence The guitar, a Taylor 710 acoustic, was valued at $3,500. Carroll spent $1,200 to repair the guitar ater iwas damaged by the baggage handlers methods o handling.

Further, upon ling several complaints with the airline, Carroll received an e-mail rom UAL saying thathis claim or compensation had been denied because he ailed to le it at the proper place or time. UALalso denied his request o $1,200 in travel vouchers to oset the cost o his repairs.

Ater months o contacting UAL personnel in an eort to be compensated, Carroll nally made a videoabout his experience entitled United Breaks Guitars and uploaded it to YouTube, a popular online videocommunity. The video went on to be viewed more than seven million times. Several newspaper, magazine

and online stories were also written detailing Carrolls ordeal. UALs negative exposure had the potentiato aect the general publics perception o the company.

UAL serves nearly 119 destinations in 26 countries and 2 territories. It has 4,700 employees worldwide

and ew about 4.03 million passengers in 2009.

Passenger revenue made up about 92% o UALs operating revenue in 2009.

That being said, passengers are vital to the success o UAL. To ensure passenger loyalty, UAL needs to beestablished as an air carrier that is genuinely invested in the cares and concerns o its passengers.

UAL has always striven or excellent customer service. A strategic public relations campaign is needed to

oset the recent negative exposure and re-establish UAL as a company that is genuinely invested in thesatisaction o its customers.

Goal Statement:

For the public to be regarding United Airlines as a quality provider o all aspects o air travel.



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Target Audiences:

Employees: As o September 30, 2009, UAL had 47,035 employees, with 12,993 o those being ight at-tendants, 15,076 being service personnel, which includes ramp and baggage employees, and 8,093 beinginvolved with management. UALs employees reside in every state in America and in many nations around

the world.

With such a large magnitude o employees, and employee behavior being one o the main causes o thechallenge, communicating with employees is vital to restore UALs reputation. It is imperative to improve em-ployee behavior in an eort to deliver unparalleled customer service and ensure customer satisaction. Flightattendants, service personnel and managers were all UAL employees whom Carroll came in contact with andwho ailed to deliver exemplary customer service.

Established Customers UAL is a company that boasts oering the right service to the right customer at the

right price. In 2009, United carried more than 82.5 million passengers. These customers ew over 114.2billion miles. Approximately 60% o these customers were aboard domestic ights. Demographics showthat the average airline passenger is rapidly getting older.

Airline passengers are typically those with higher amounts o disposable income. It is extremely importantto reach passengers who travel on business. These are the most requent iers with UAL and are thereorethe most important to reach. Business passengers are also more likely to travel with baggage that requiresmore delicate care. Leisure travelers are also highly important to reach because o the large segment o

business they represent. These customers are less likely to have an established loyalty to UAL. While theymost commonly travel with typical luggage (clothes and everyday necessities), they also routinely checkgol clubs, guitars and other items that require more care.

Potential Customers: UAL alone carried more than 651 million paying passengers in 2008. There weremore than 157 million passengers on international ights (rom the United States to other countries) in2008. In total, that was over 809 million passengers. This means about there are about 726 million poten-tial customers or United Airlines. Air travel has decreased about three to seven percent annually, makingit even more difcult to win over and comort potential customers.

There is a huge pool o potential customers that UAL must take into consideration. These customers arealready ying; UAL needs to make them want to y with its airline. Some customers do shop or airlinessimply by lowest price while many others will stick to airlines they have had a good experience with beore. Many actors go into the decision to choose an airline such as a history o ight delays and customersatisaction. Potential customer attitudes towards UAL can be changing on a daily basis, depending largelyon how the airline is perceived and portrayed by the media.

Investors: UAL is listed in the NASDAQ Global Select Market and has issued more than 125 million shareso common stock to investors. However, o the 125 million shares, 115 million have gone to employees

Thereore a large portion o the investor base is actually UAL employees. Nonetheless, they have instituted a maximum ownership limitation o ve percent. Unortunately they are operating at a -5.75 percentprot margin. Moreover, rom February 1, 2008 to March 28, 2008, United Airlines stock price went rom$41.14 per share to $21.19 per share. UALs stock dropped by almost hal the price within a two monthperiod ater the guitar incident.


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In UALs 2008 SEC lings, it listed some o the major concerns or the company, some o which included

a terrorist attack, bankruptcy consolidation, high uel costs, negative economic conditions and exten-sive government regulation. Based on these concerns, UAL shareholders are most likely earul o thecompanys uture. In addition to these actors, the -5.75 percent prot margin may cause non-employeeshareholders to no longer be investors. Luckily, 92 percent o UAL shares are held by employees. Thusthey will be more likely to stay invested in the company as it overcomes the challenges ahead. Externalinvestors will also have more incentive to stay with, or invest in, the company because it is the ourth larg-est air carrier in the United States.

Objective 1 (Employees):To reduce the number o damaged baggage complaints by 20% by ensuring that UAL employees act responsiblyin an eort to deliver exemplary customer service.

Accountability Strategy: UAL and its employees must be accountable or their actions relating to poocustomer service. In order to do so, employees at all levels must admit their mistakes and work diligentlyto make amends or those mistakes. Accountability eorts must be ocused inward, within the companyand outwards, toward the general public.

Tactics:1. UALs human resource personnel will promote proper behavior by putting in place and

utilizing a system that can be utilized to discipline employees who ail to deliver optimalcustomer service.

2. UAL management then must implement a system o monitoring what employees work on eachight, and then holding those employees accountable, via the disciplinary system, or anymisconduct that takes place on such ights.

3. UAL employees, especially those individuals in upper management positions, will take publicresponsibility or the poor customer service o all employees. Specically, a UAL ofcial mustpersonally contact Carroll, admit that employee conduct was inappropriate and apologize or

it, and work to appease his concerns. Similar action should be taken in the uture, prior to acustomers public proclamation o dissatisaction.

4. UAL will develop a simple method by which customers can le a baggage complaint. Even i acustomers complaint is not legitimate, UAL customer service personnel must contact theindividual and work to reach some level o compromise to appease the customer.

5. UAL will hire a Social Media Strategist who will be responsible or keeping UALs social mediasites, such as Twitter, Facebook, YouTube, etc., up to date. Through these platorms, the SocialMedia Strategist will promote transparency and exempliy accountability by responding tocustomer concern.

Quality Assurance Strategy: In an eort to reduce baggage complaints, UAL must take extreme measuresto ensure that employees are highly trained in the areas o customer service and appropriate execution o em-

ployment duties at all levels.

Tactics:1. UAL will provide employees who handle baggage with training sessions in which appropriate

guidelines or handling luggage are discussed, and negative consequences o inappropriateconduct are explained.

2. UAL will provide ight attendants with training sessions that address how to eectively handle



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situations in which customers le complaints. These training sessions will provide ightattendants with materials that disgruntled customers can be given explaining how to ormally lecomplaints with the new, simple method developed by customer service.

3. UAL will provide customer service personnel with training sessions in which employees arenotied o ways in which to deal with customer complaints including: what types ocompensation can be oered, when it is appropriate to oer those types o compensation,alternative methods o appeasing customer concerns and ways o showing genuine investment

in customers concerns.4. UAL will then administer tests and evaluations to ensure quality employee perormance upon

completion o training programs. Such evaluations will occur sporadically throughout anemployees employment, without the employees knowledge. Those who ail to perormexemplary service will be met with more training or disciplinary action.

5. UAL customer service personnel will also evaluate the number o complaints led each month.Upon completion o the complaint and compensation process, customers will be sent surveysand asked to rate their experience with customer service personnel.

6. UALs Social Media Strategist will upload videos o employee training sessions to YouTube. TheSocial Media Strategist will then assemble a social media press release containing links to thecompanys social media outlets. The Social Media Strategist will send this release to industry

(such as business and travel) bloggers. By spreading news through social media, UAL will makeits quality assurance eorts known to the public.

Objective 2 (Established Customers):To reach established customers with a message that UAL prides itsel in positive customer service and is

working to provide customers with an excellent experience every time they y with UAL so that they viewUAL as a company they can trust and are loyal to.

Dual-Directional Communication Strategy: Established customers will be aware that UAL highlyvalues its customers and is dedicated to ensuring their satisaction in all aspects o their travel with UAL so

that they continue to choose the airline or their ights, both domestic and international.

Tactics1. Send an e-mail to established customers with an explanation that UAL recently ailed to meetits standards o providing an excellent experience or all customers and is dedicated to making

improvements that will ensure customer satisaction. Include in the e-mail a link or customersto send eedback about their experience ying with UAL.

2. In order to show that UAL takes customers seriously, create a team to respond to all legitimatecustomer eedback. The message relayed will be one o UALs commitment to improving

customer care to ensure an excellent experience in all aspects o air travel.3. Send a direct mailing to the top ve million repeat iers with an explanation that UAL recently

ailed to meet its standards o providing an excellent experience or all customers and isdedicated to making improvements that will ensure customer satisaction.

4. In order to show that UAL takes customers seriously, include a phone number o a hotline orcustomers to call with eedback about their experiences with UAL. This hotline should be a

direct line to contact with a human, not a machine.


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Electronic Media Communication Strategy: Customers will be reached through a variety o mul-timedia avenues. Through the use o dierent orms o media, we will be able to reach large segments othe population. Television, internet video and radio are each more likely to reach a dierent demographic.

Tactics1. A reputable UAL representative will appear in interviews on CNN, MSNBC and FOX NEWS to

show transparency and ownership o the challenge UAL aces.2. Use the UAL YouTube channel to have a company-controlled presence on the Web site. Produce

a video response to Dave Carrolls United Breaks Guitars video. This video should be comical,

to match the tone o Carrolls video, but should also convey a message o understanding andownership o the challenge.

3. A reputable UAL representative will be interviewed on NPR to reach larger segments o thebusiness customer base. This interview will convey transparency and ownership o the challengeUAL aces.

4. Secure a week or Glenn Tilton, President and CEO o United Airlines to appear on CBSs realityshow Undercover Boss. Make sure that Tilton spends time with baggage handlers on thetarmac.

Objective 3 (Potential Customers): To ensure that potential customers see UAL as a responsible, reliable and paramount airline service andchoose to y with UAL on their next trip.

Raves and Reviews Strategy: UAL has many great services and has been recognized as an exceptionaairline in several areas. This strategy will inorm potential customers about all the great things said aboutUAL to combat the ew negative things being said about them.

Tactics1. Gather all the good comments made about UAL in the media and any distinctions it may have

won, such as being named the number one on-time airline by the U.S. Department oTransportations Air Travel Consumer Report, and compile them into one aesthetically-pleasingand comprehensive list to post on the UAL Web site and to send out to various media outlets.

Social Media Strategy: This crisis stemmed rom Carrolls expert use o social media and an importanway to combat it is through more social media. Although UAL should not directly butt heads with Carrolor slander him on YouTube, it should utilize the medium to reach the same audience Carroll did.

Tactics

1. Create ofcial UAL social media accounts that are creative, actual and are utilized in a way thatwill grab attention but not be inammatory and link them all to one another so potentialcustomers can be easily lead rom one site to another, gathering various inormation.

a. YouTube: Create interesting and youthul videos that will mimic the eel o Carrollsvideos without mocking him or deaming him and upload them to the existing YouTubeaccount. This will catch the attention o the same audience. Some short videos couldinclude songs about low-priced airare, positive customer service experiences or notesrom the Raves and Reviews list. Include tags with each upload so potential customers

who may be searching or Carrolls video will also come across the videos by UAL.



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b. Twitter: Consistently update the existing Twitter account at least 4 times a day. Tweetabout the Raves and Reviews, apologize about not perorming to its normal standard ocustomer service, discuss any changes in customer service policies and encourageollowers to tweet any questions, concerns and comments.

c. Facebook: Utilize the existing ofcial Facebook page to apologize to customers andcreate a discussion group that will encourage potential customers to air any concerns andreceive answers within a week. Also utilize the several an pages and non-ofcial pages

that are about UAL and respond to them as necessary (such as thanking those in the groupabout how great UAL is and asking those in the group that dislike UAL what they can doto create a better experience or passengers).

d. Blogs: Comment on any major blogs that talk about UAL consistently such astravel.blogcarnival.com, evilunitedairlines.blogspot.com and triporati.com. Some o theblog entries are very negative and UAL commenting on them will show that it actuallycares about each and every customer. On the blogs that praise UAL also comment andapologize or not living up to the standards they are used to or mention what UAL is

doing on a daily basis or continual improvement.

Economic Incentive Strategy: Potential customers are very driven by prices when choosing an airline

to y with. While the crisis is continuing and potential customers may have a negative connotation oUAL, it should compensate by creating an economic incentive.

Tactics1. Create and heavily advertise a customer satisaction guarantee program. I a ight is overbooked

or luggage is lost a customer will get compensation within a week or they get a ree ticket.2. Reiterate UALs lowest price guarantee so customers will see that booking with UAL will always

be the best choice economically.

Objective 4 (Investors):To eectively communicate to investors that UAL is actively pursuing customer service corrections in or-der to provide nancial stability or investors.

Investor Stabilization Strategy: Because UAL is already in an economic struggle, a worst-casescenario would be massive shareholder selling. Thereore, it is imperative that we convey a clear messageo action in order to stabilize the nancial situation produced by the guitar incident. The poor image pro-duced by the incident must be rectied in order to assure shareholders that their money is not in danger.

Tactics:

1. Create an investor inormation kit that contains important documents including a news release,Frequently Asked Questions page, mission statement and letter o apology will also be placedon the investor relations portion o the Web site. It will be assembled in a style similar tothat o a media kit.

a. News release: This release will be tailored to the investors o UAL. It will include ageneral overview o the incident, how UAL is working to correct the problem and theeect this incident will have nancially on UAL. It will also promote the positiveexperience gained rom the incident and an explanation o how UAL has become abetter customer-oriented company because o it.



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b. Frequently Asked Questions (FAQ) page: A public relations and nance team will providean FAQ o important investor inormation that is pertinent to the situation. It will includebasic inormation, such as what on what stock exchange UAL stock can be ound. It willalso include scal year dates. However, it will also include questions and answers more

specic to the guitar incident, such as what happened to the employees who committedthe act and an explanation o how UAL working to solidiy positive customer service.

c. Revised Mission Statement: A revised mission statement will be placed with the othermaterials in the investor inormation kit. The public relations team, along with keyofcials in the company, will identiy key areas o criticism, such as customer service andinclude a detailed statement o how the company hopes to satisy the needs in those areas.

d. Letter o Apology: The main spokesperson o UAL will drat a letter o apology toinvestors. It will apologize or the poor treatment o customers and the eect the incidentcould have on investors. Also, it will detail a course o action to mend the situation and

move the company in a positive direction. This letter will also be sent to investors throughmail and email i available.

Two-Way Investor Communication Strategy: By providing investors with a platorm to communicatewith company ofcials, UAL will show a genuine interest in the concerns o investors, allow them to posequestions, provide a platorm or eedback and give investors a genuine sense o owership in the company.

Tactics:1. Shareholders will be invited to attend a meeting with a public relations spokesperson and a

nancial spokesperson. At the event, details o the incident and nancial inormation will bedisseminated in a ace-to-ace ormat. There will also be a chance to ask questions. This willhelp enhance the image o UAL because interpersonal communication has more impact onindividuals. Segments o this meeting will also be placed in video ormat in the investor

inormation kit.2. A blog will be ormed or the company tailored to investor inormation. The blog will allow a

more conversational ormat o communication. It will also allow worried investors tocommunicate their concerns to an ofcial o the company.

Evaluation

Employees:

Objective: To reduce the number o damaged baggage complaints by 20% by ensuring that UALemployees act responsibly in an eort to deliver exemplary customer service.Assessment: The Accountability strategy will be assessed by evaluating whether or not a disciplinary systemwas put in place, utilized, and eective in deterring individuals rom mishandling baggage. Accidents dohappen, thereore, a 20% decrease in baggage complaints ater training sessions and disciplinary actions

would reect more careul behavior on behal o employees. The number o baggage complaints will be

assessed by the new simple system or ling complaints, which will also monitor the number o complaintsled. This number will be compared with the percentage o baggage complaints rom the same timeperiod o the previous year.

The Quality Assurance strategy will be assessed by monitoring the number o employees who completed training.The strategy will also be assessed by seeing i management ollowed through and continued to evaluate theperormance o employees, and whether disciplinary action and training improved that perormance.



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Established Customers:Objective: To reach established customers with a message that UAL prides itsel in positivecustomer service and is working to provide customers with an excellent experience every timethey y UAL so that they view UAL as a company they can trust and establish loyalty to the airline.

Assessment: The Dual-Directional Communication Strategy will be assessed by tracking hits on

the customer eedback page that is linked to by the e-mail. Further, the number o responses willbe recorded. We will also record the response time o each message to evaluate the standard oreplying within two days. The success o the direct mailings will be evaluated based on thenumber o calls to the hotline.

The Electronic Media Communication Strategy will be assessed by tracking comments made onCNNs, MSNBCs, FOX NEWSs and NPRs webpages related to the interviews. Determine theaverage viewership o the program on which the interview is conducted. Also, track online newsactivity generated by the interviews.

The success o the YouTube channel will be measured by the number o views or the postedvideos, especially the primary response video. Comments on videos will be monitored as well.

Ratings rom Undercover Boss will be used to measure the success o that exposure.

Potential Customers:

Objective: To ensure that potential customers see UAL as a responsible, reliable and paramountairline service and choose to y with UAL on their next trip.

Assessment: The Raves and Reviews strategy will be assessed by placing a hidden trafc counteron the Web site page and seeing how many unique hits the page got. Also, a media audit will beperormed to see i the media or blogs picked up a story about one o the raves and reviews and i

it was portrayed in a positive or negative light.

The Social Media strategy will be assessed by counting the number o views the new YouTubevideos received, as well as any increase in how oten the older videos were watched. Anycomments to Twitter or Facebook will be counted and those who had a conversation through anofcial UAL social media site will be asked i it changed their view o UAL or i they were morelikely to y with UAL. The tone and existence o any anti-UAL blogs will be monitored aterUAL comments on them to see i the tone changes at all.

The Economic Incentive Strategy will be measured by giving passengers on all UAL ights theoption to ll out a comment card which will ask:

WhydidyouchooseUnitedAirlinesforyourairtravel?

AreyousatisedwiththepriceofyourUnitedAirlinesticket?

HaveyouownwithUnitedAirlinesbefore?

Doyouhaveanycommentsorsuggestions?

These cards will be collected and counted.



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Investors:

Objective: To eectively communicate to investors that UAL is actively pursuing customer servicecorrections in order to provide nancial stability or investors.

Assessment: The Investor Stabilization strategy will be assessed in numerous ways. First, we willconduct a media audit to see who utilized the news release or investors. We will also track thenumber o hits the release has on the Web site. Second, UAL will count hits or the FAQ and the

revised mission statement. Third, we will measure the stock price o UAL over the duration o thecampaign. Because the strategy is to stabilize the investments in the company, stock prices will

be paramount to all other orms o evaluation. Furthermore, i the stock price does all, we willhire a nancial research rm to analyze the reason or the decline.

The Two-Way Communication strategy will be assessed in our ways. First, turnout at theshareholder meeting will be measured. Turnout will be measured against the number oshareholders in the company. This will also exclude employees who are shareholders, but theywill be invited to come and will be counted separately. The quality o the meeting will also bemeasured. We will hand out collateral in the orm o a survey to those who participated in the

meeting to gauge their reaction to the event. Second, segments o the meeting will be placed

online where we can measure trafc to the video. Third, measurement o participation in theinvestor blog will take place. We will measure trafc and the temperament o those whoparticipate. Temperament will be measured as negative, neutral or positive. Fourth, we willconduct in-depth interviews with investors who hold more than one percent ownership o thecompany. This will also exclude employees o the company. This will provide us with qualitativedata as to the image o the company rom a shareholders perspective. This measurement toolcould also assist us in our stock price evaluation. I prices do all, we can use inormation romthe interviews to deduce why investors dropped their shares.

Timeline

Within 24 hours: -Send e-mail to established customers.-Issue apology on Facebook, Twitter and investor relations Web site.-UAL representative interviewed by CNN, MSNBC and FOX NEWS.-Press release or investors-FAQ

-Revise mission statement

Within 1 week: -Launch Raves and Reviews page on Web site.-Create and post YouTube videos.-Have a UAL ofcial issue an apology letter to Dave Carroll.-Send out direct mailings/letters.-Create investor blog.-Comment on existing travel blogs.



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Within 1 month: -Start advertising campaigns or customer satisaction and lowestprice guarantee programs.

-Develop employee training programs.

-Secure a week or Gregg Tilton to appear on Undercover Boss.-Hold investor meeting.

Within 3 months: -Have employees complete customer service training programs.

As Soon as Possible, but no more than 3 months:-Hire Social Media Specialist-Create, implement and utilize disciplinary action program and

employee evaluation program.

BudgetHire a Social Media Specialist $50,000/yearDirect Mailings $3 million

Training sessions $2.35 millionAdvertising Campaign $650,000

Investor Meeting $2,500__________________________________________

Total $6,052,500

United We Care

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