United Beta-Business Class - How to Capitalize on UAL's Mistakes To Convert High CLV Customers PDF Print E-mail
Sunday, 16 March 2008

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My day brilliantly unfolded in a way that allowed me to take my favorite role in life - the role of a social scientist! I was the unfortunate victim of United Airline's new international business class - even though I was flying domestic! As an experiential marketer, it was a great day to be alive - so many things to dissect from a Customer Experience Management (CEM) point of view. There was even a chance to see how the on-board employees were going to handle the 80/20 rule and the notion of Customer Lifetime Value (CLV). I couldn't believe that all of these fantastic dynamics were going to come into play in just one 5 hour plane ride. I may be the luckiest guy alive.

Most of the folks around me were really upset, but I was busy acting like a sponge taking it all in. I didn't care to be upset - I wanted to learn - learn - learn.

Ladies and Gentlemen - I present you Flight #XXXX From SFO to XXX - and away we go. Not looking to get anyone in trouble so everyone shall remain nameless.

It's fair to say that we've all had our moments with airlines. If you travel a lot then everyone is bound to reach their breaking point fairly frequently these days.

We were extremely excited to find out that our typical aircraft had been replaced with one of United's new international crafts. They're quite impressive and are designed to deliver a highly customized flying experience through individual entertainment systems. "Everyone have fun playing with the new toys" the flight attendants said joyfully as we all took our seats. I was looking forward to making this flight meet all of my needs - it was all so very cool!

Expectations were high as the plane pushed back from the jetway. Within minutes the screens went black and the attempted reboots of the new entertainment systems began. They tried a myriad of techniques, but nothing seemed to work. Shucks - but wait - this is where it gets very interesting - very!

Let me first say that I felt very sorry for the flight attendants as they clearly weren't IT people, and this was the 2nd "new" plane to fly. From what they said, the first plane's system was completely shut down. So, one would assume that United may have wanted to have one of the vendors responsible for the systems on the plane to troubleshoot. Instead, United Airlines put all of their employees in a very unfortunate situation - one that was totally avoidable. There was no way for the flight attendants to deal with the number of people who were upset. It must have been quite demoralizing for them not to be able to service the customers the way that they wanted.

Active ImageIt turns out that the majority of the lower CLV customers systems in economy were working splendidly, but the majority of the first the business class units were not working. So you have a situation in which the higher paying customers are receiving less. That's fairly interesting, but it gets better. The first and business class section travelers are generally the customers that have a much higher CLV than those that fly in coach. These customers fly more often, and are more loyal to an airline as they are usually enrolled in the Frequent Flyer programs.

I had told one of the flight attendants that the only way to get the system up would be a hard reboot, but that would have interrupted everyone else's movie in economy. Should the flight attendant be put in the position to have to be making those kinds of decisions? I think not!

Essentially - United Airlines failed both their customers and employees by not adequately testing their systems before they put the airplane in use. This all brought one thing into crystal clear focus for me - I feel trapped in my relationship with United Airlines much like I did with my iPod (that story is in an earlier blog post).

Active ImageI am clearly a loyal flyer, but one company's problem is another company's time to act!

Running under the general assumption that most people are dissatisfied with their current airline, why doesn't one airline make the following strategic move?

Concentrate on customer service - build your entire brand on the platform! Then, go right after the other airlines high CLV customers by offering them the same status they had on your airline - free of charge. These customers have clearly shown through their behavior that they are extremely loyal, and the risk/reward for this strategic move is low risk - extremely high reward.

I'd switch airlines - I do 125-200K miles a year. Perhaps this is a space in which an airline needs to position themselves? Hmmmmmmm. Then make their move to grab all the high CLV customers from all the other airlines.

In any case - random food for thought as I descend into JFK.

I love learning, but wish I could have been entertained by all these fabulous electronics! Smile

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