Marketing Doctor John Tantillo’s Winner and Loser of The Week
Loser: Jon Corzine
JetBlue might not seem like an obvious choice for a winner.
After all, aren’t these the folks who left a planefull of passengers stranded for seven hours on the tarmac in Hartford, including several people with medical conditions?
But in branding, it can be how you respond after things go wrong that matter and JetBlue responded well.
More than any other airline, JetBlue’s challenge when it comes to the effect of tarmac strandings is bigger than anyone else out there.
Why? Because it was an infamous JetBlue stranding several years ago that led to the Passenger Bill of Rights under which the incident in Hartford could cost the airline up to $27,500 per passenger.
Bottom line, other airlines might have stranding issues from time to time, but when it happens to JetBlue there’s immediate news, because of the history there.
But again, it’s how you respond to a crisis that matters –especially one that you really didn’t cause.
JetBlue was operating in a snowstorm and while there are different reports about what the pilot did or didn’t say, the fact is that most people are reasonable enough to accept that a service operating under difficult and unforeseen conditions (a freak snowstorm in October) might face big problems that will impact on their convenience.
In fact, with air travel as difficult and annoying as it often is today, the bar to making customers happy is certainly not nearly as high as it once was.
For Jet Blue this means that they immediately had to do four things after this stranding: apologize, take responsibility, promise to do better and offer a concrete path to doing better.
They did this by having Rob Maruster, their COO, deliver a video and written message on their website. I’ll quote part of it here since it is a good example of how to respond. After explaining what led to the tarmac delay and emphasizing that safety was never compromised, he says:
But let’s face it – at JetBlue you count on us for a lot more, and we promise a lot more, and we know we let some of you down over the course of this weekend and for that we are truly sorry. Going forward we plan to fully participate with the Department of Transportation in cooperating with their investigation into the events over the weekend and we’re also going to conduct an internal evaluation so that we can learn from this event – because at the end of the day you deserve better and we expect better from our crewmembers and our operation. We can only earn your loyalty and trust one flight at a time and we ask you to give us a second chance. Thank you.
When you take the “we’ll do better and this is how” message and then combine it with some of the good things the Jet Blue pilot was recorded as saying that night (e.g., We just need a tug and a tow bar. If you just give me a welding shop, I’d be happy to weld one myself.), you walk away with a picture of an airline that actually means what it says.
The proof is in the followup. Not taking the promised-action or another similar incident could do real brand damage, but as of today Jet Blue has taken the right step on the road to recovery.
Jon Corzine is our loser this week.
MF Global, the company Corzine joined after leaving the governorship of New Jersey, has gone bankrupt and the culprit looks to be very bad judgment on Corzine’s part.
Tim Worstall at Forbes Magazine describes what happened this way:
If you’d like the story in a nutshell, here it is. MF Global was a broker. They took orders from their customers, did the fiddly bits to actually make the trades happen and then took a small fee on every trade to pay themselves. Their customers also had to put up collateral (ie, park some cash with the company) to cover the risks of those customer’s trades.
MF Global made money on their fees and the interest on the money they were sitting on. As we know, interest rates have been very low for several years now. So, to boost the company profits John Corzine decided that instead of just being a broker, doing the technical stuff for other people, they should become a trader. Taking their own positions, placing their own money on bets in the markets and making profits, not taking fees.
So off they went to do this and the deals they did, the positions they took, went wrong, lost all the firm’s money and so they went bankrupt.
The brand problem lies in Mr. Corzine, a former trader and leading figure at Goldman Sachs. Many former partners at Goldman Sachs get into trouble when they go out on their own. It’s as if the brand discipline at Goldman doesn’t translate when they leave –probably because brands are complex things with histories and rules all their own. Corzine was a great part of the Goldman brand but when he left, he didn’t bring the brand with him.
But he did bring the reputation of the Goldman brand with him and that’s part of the problem here. According to reports, people lined up to give money for what was a high-risk trading strategy because Corzine was, in part, a Goldman man.
“Those people walked around with halos around them. Myths have been created on Wall Street. Nowhere is the myth bigger than at Goldman,” said
William Cohan, the author of a book on Goldman Sachs.
The problem with Corzine and MF Global was a clear clash of brands. Corzine seemed to want to make MF Global into something it was not and he wanted to do this quickly by making outsized bets, heavily leveraged, that could have reaped huge paydays… if only they had been right.
One of the reasons that Corzine was probably so successful at Goldman was the firm could keep his risky trading behaviors under control, harnessing them to make profits but not letting them bring the whole house tumbling down. But at MF Global, Corzine was bigger than the company, and in the end it looks like that brought down two brands.
And remember, it’s always easier when you keep marketing and branding in mind.
TODAY’S TANTILLO TAKEAWAY – When your brand faces a crisis with customers remember: apologize and promise to make things right.