How a refusal of a $1200 travel voucher resulted in a $180 Million decrease in valuation!

Reputation management in a corporation is EVERYONES responsibility.

United Airlines is one of the best examples of poor staff conduct which resulted in a viral campaign which affected all areas of the company, including its share price and profits!

When an issue is identified within a corporation and consumers start talking about it, action needs to be taken ASAP.

In the example of United Airlines, while waiting on a plane, Dave Carroll heard another passenger say, “My God! They’re throwing guitars out there!”

As Dave and the other band members looked out onto the tarmac where the luggage was being unloaded and they recognised their guitars. He immediately informed three staff, however he was just brushed off.

Dave’s guitar was badly damaged and he tried to get United Airlines to admit responsibility and pay the $1,200 damage bill.

After 9 months of continuous “passing of the buck” he wrote a song called “United Breaks Guitars” which went viral, he also created a music video which resulted in over 10.7 million views!

The BBC reported that United’s stock price dropped by 10% within 3-4 weeks of the release of the video, a decrease in valuation of $180 Million!

During the original request for help, Dave told them he would have been happy with $1200 of travel vouchers.

What can be learned from this?

Most customers are quite reasonable at the start of their ordeal, they simply want things to be “put right”. Sometimes a simple apology and the resolution of the issue is all it takes.

Here at IC3 Solutions, we get involved between the point where the corporation has missed that window of opportunity to make things right and the customer is now considering a social media campaign, contacting the media outlets or starting legal action (or a combination of all three).

We look at what internal systems and processes need to be reviewed to ensure this type of issue is caught by the organisation and actioned BEFORE it goes public and we look at case(s) at hand to recommend a suitable cause of action, which might be as simple as an apology or an explanation, or it could involve a refund, a replacement product or a financial settlement.

We have already assisted corporations avoid over 697 legal cases, through careful guidance and fair outcomes for their consumers, resulting in a win for the corporation (no brand damage or legal costs) and a win for the consumer (full resolution to their issue with no additional costs or stress).