Out of the Box

Dealing with Mistakes

By Menachem Lubinsky on March 28 2008

How do you say:"i’m sorry, I made a mistake, it’ll never happen again”? Some people find all kinds of ways to say that without ever saying it, but in marketing, you’d better learn to say that statement or it might prove to be catastrophic.

That’s what happened to Southwest Airline when it was fined a record $10.2 million earlier this month and later was forced to temporarily ground 38 Boeing 737s because of record-keeping lapses involving inspections of the jets’ fuselages. The airline was one of those successful discount air carriers like JetBlue that have catapulted to the top of the industry. Such a serious lapse in safety and concern for the welfare of its passengers could be catastrophic if not handled correctly.

Management knew very well that its loyal base of travelers who enjoy the amenities on its planes and discounted fares would need some kind of reassurance that the safety issue was an aberration and that the airline took its responsibilities towards its passengers seriously. So the question becomes how to say you’re sorry, show that you really mean it, and move on from there.

Throughout the first few days of its ordeal, Southwest sent many mixed messages. It at first tried to minimize the problem by suggesting that the FAA’s concern was only on a small part of many safety checks and in any event on a tiny percentage of its fleet. But with an unprecedented fine levied against it, that response did not fly. Then came the more standard damage control reply that spokeswoman Beth Harbin seem to give: In effect she said that the airline continues to sort out its safety issues but is heartened by bookings that show no noticeable drop off, despite an avalanche of negative publicity about maintenance shortcomings.

As the airline nervously watched its reservations, it soon learnt that its loyal base was forgiving and that all it needed to do was weather the storm. The investment community apparently shared that view as its ratings remained steady. By now the airline was back to a strategy many attribute to the PR savvy Reagan White House that was infamous for quickly cutting its losses in what became known as the Iran Contra Scandal.

It turns out that the events associated with Southwest snowballed into much more than just the discount carrier. The FAA ordered safety inspections at other airlines as well and indeed some infractions were found. The FAA itself came under some intensive criticism by Congress and the media for not acting quickly enough and for being lax in enforcement in general.

Does the fact that Southwest was no longer alone with the safety problems help Southwest? Marketers will tell you that every little bit helps, but fundamentally Southwest’s main concern is to reassure its flying base that it takes safety seriously and that whatever lapses it had is a thing of the past. So far so good. The airline has not had a spade of cancellations despite the negative publicity. The large fine has not broken the bank so the airline will not be forced to curtail services.

The whole Southwest episode raises an interesting challenge for marketers. Invariably a company or business will be caught at some shortcomings that may be the result of negligence or simply oversight. There may a reason for why it happened, such as a callous worker or incompetence. But whatever the reason, the net result is a potential loss of consumer confidence and business.

Several years ago, a number of consumers found foreign substances in canned foods produced by a well-known manufacturer that were by no means dangerous but disturbing nonetheless. The company instantly issued a recall of the whole lot and released a statement of apology to its customers. What was noteworthy was that it also asked customer that many have bought the product to send in the UPC for a refund and replacement cans. Approximately 22 people took the time to respond to the company offer. What they got was much more than a replacement can. They received an entire case of the product, a check for $50 and a letter of apology.

The company’s actions were so well received that sales actually soared. It had made lemonade out of lemons. But not every company acts with such wisdom. Many do their best to either run from the problem or camouflage it to make believe that it either never happened or find ways to blame others. I’m sure you’ve met people who are never at fault. It was always someone else’s problem.

So Southwest would do best to simply say that they are sorry and that they are taking new steps to assure that such safety issues never arise again. They may have to do what some companies do when faced with a similar problem, fire the person in charge. Sports teams are notorious for firing the coach rather than the team that underachieves.

But customers very much appreciate honesty and humility. They can be very forgiving when you sound human but are vey unforgiving when they sense a cover-up. So far Southwest has managed to sound human and its customers are vey forgiving. But if there is a reoccurrence or if there is a perception that the company was more negligent than meets the eye, they will feel it with cancelled reservations.

It’s amazing how difficult it is for some people to say “I’m sorry.” And even more amazing that some people won’t say that phrase even if they know that it has a potential for bringing them down if they don’t. For some, no matter how serious the issue, that good old ego simply gets in the way of doing the right thing. In marketing, it is certainly a no-no.

Out of the Box is a collection of strategic marketing articles that Lubicom has published on various topics, trends and ideas in the marketing world. The articles have been published in the Hamodia weekly newspaper circulated on three continents to a readership of well over 100,000.

The name, "Out of the Box" is a term used frequently in business nowadays to describe creative thinking that is not the norm. It is meant to help a business pull away from the pack or separate oneself from the competition. It is to some extent fraught with risk, simply because it is not the run of the mill thinking, but it is at the same time the key to reaching the next opportunity.