[{"@context":"http:\/\/schema.org","@type":"BlogPosting","dateModified":"2023-01-17","datePublished":"2023-01-17","about":["http:\/\/www.wikidata.org\/entity\/Q984142","http:\/\/www.wikidata.org\/entity\/Q1141276","https:\/\/en.wikipedia.org\/wiki\/Communication","http:\/\/www.wikidata.org\/entity\/Q503308","https:\/\/www.the-future-of-commerce.com\/2023\/01\/17\/southwest-airlines-meltdown-lessons\/#About","Commerce","Marketing"],"url":"https:\/\/www.the-future-of-commerce.com\/2023\/01\/17\/southwest-airlines-meltdown-lessons\/","mainEntityOfPage":"https:\/\/www.the-future-of-commerce.com\/2023\/01\/17\/southwest-airlines-meltdown-lessons\/","keywords":["https:\/\/www.the-future-of-commerce.com\/2023\/01\/17\/southwest-airlines-meltdown-lessons\/#BlogPosting#3","Brand Management","Customer Experience Management","Intelligent Enterprise"],"description":"The Southwest Airlines meltdown during a peak travel season provides lessons for IT operations, marketing, and crisis response.","name":"Southwest Airlines meltdown: 4 business lessons","headline":"Southwest Airlines meltdown: 4 business lessons","articleBody":"It took 50 years for Southwest Airlines to establish itself as a trusted brand that treated passengers and employees with kindness and respect. But all it took was a punishing storm during the holidays to unravel that perception and trigger intense scrutiny of the airline\u2019s operations.The Southwest Airlines meltdown, in which the carrier canceled more than 16,700 flights between December 21 and 29, costing it between $725 million and $825 million in revenues, will be studied for decades.The debacle stranded thousands of loyal customers at the peak of the holidays and revealed the company\u2019s sluggish crisis response and apparent failure to update its primitive scheduling software.What can business and marketing leaders learn from this? Experts believe there are several key lessons that every company should take to heart, including:Invest in technologyStep up crisis responsePull untimely adsCommunicate often and honestly      Bad trip: The state of travel customer experience                What happens when travel is the stuff of nightmares rather than dreams? Unfortunately, after COVID, it's become all too common.      Southwest Airlines meltdown blamed on outdated techDuring Founder Herb Kelleher\u2019s tenure, Southwest Airlines passengers mostly understood and accepted that you gave up frills like fancy beers, meals, and assigned seating in exchange for cheaper, no-hassle flights that usually landed on time.Since Kelleher stepped down in 2001, the airline\u2019s approach to thriftiness appears to have intensified, especially at a business level, limiting much-needed modernization of information technology infrastructure.Southwest wasn\u2019t the only U.S. airline to experience storm-related delays and cancelations during the holidays. And travel headaches continued this year when the Federal Aviation Administration\u2019s Notice to Air Missions or NOTAM system went down, causing more than 6,700 U.S. flight delays and more than 1,000 flight cancellations.But Southwest did account for more than 85% of holiday flight problems. Unions blamed the company\u2019s lack of investment in scheduling software for its inability to quickly and efficiently recover from the crisis.\u201cFor more than a decade, leadership shortcomings in adapting, innovating, and safeguarding our operations have led to repeated system disruptions, countless disappointed passengers, and millions in lost profits,\u201d Southwest Airlines Pilots Association said.Experts says executives in companies that aren\u2019t updating IT should sound the alarm bells and use the Southwest example to sell the need for greater investment.\u201cAvoiding these kinds of things comes down to raising flags internally and saying, \u2018look, we\u2019re not able to do our jobs effectively with this technology,\u2019\u201d says Kelly Soderlund, senior director of global public relations for TripActions, a corporate travel and expense management company. \u201cCompanies really need to invest in software to optimize how they operate.\u201d      Digital transformation tactics: How customer obsession drives results                Discover the digital transformation tactics that fuel real-life business success, high conversions, and customer obsession.      Poor crisis response points to need for better prepAmid the Southwest Airlines meltdown, executives spent considerable time apologizing while trying to get flights back on track. But they didn\u2019t immediately inform stranded passengers what the airline would do to make things right.It\u2019s unclear if Southwest was simply overwhelmed or was simply unprepared for a crisis of this magnitude. Either way, experts advise companies to always have a playbook on hand outlining how they will respond when a catastrophe strikes and affects their levels of service.Southwest did step up efforts to compensate impacted passengers. A spokesperson said it\u2019s processing \u201ctens of thousands\u201d of refunds and reimbursements per day. And it approved a \u201cgoodwill gesture\u201d of 25,000 frequent-flier points to customers whose itineraries were disrupted.Even so, issuance of these make-goods haven\u2019t been as prompt as some passengers may have liked, leading to thousands of complaints, according to a spokesperson for the U.S. Department of Transportation.\u00a0Exact numbers from the December event are not yet available, the agency added. @fox32chicago We hope they get home quickly and safely! #southwest #southwestairlines #chicago #fox32chicago #fox32 #travel #problem #flying #weather #newyear #nightmare #midway #airport #funny #viral #foryou #fyp  \u266c original sound \u2013 Fox 32 Chicago  Turn off tone-deaf advertising\u00a0When buried in a crisis, it\u2019s often difficult for companies to assess, adapt, or adjust marketing materials, such as advertisements. But smart companies do it.Southwest, on the other hand, let at least one slip during its holiday meltdown. In the midst of the weather event, it was still running an ad with a smiling pilot.Promoting top executives in the wake of the crisis also doesn\u2019t help the brand. Southwest\u2019s promotion of several executives, including its VPs for network planning and customer experience, immediately after the meltdown, raised eyebrows of industry observers and the ire of stakeholders.      Crisis defines brands: Are you gaining or losing customers?                Brand crisis management requires having a plan before disaster strikes. Learn how to implement a strategy to keep customers happy and see examples of brands getting it right.      Communicate quickly, sincerely, and transparentlySouthwest told us it prides itself on being open and timely. During the recent \u201coperational challenges,\u201d a spokesperson for the airline said it fielded more than 2,000 media inquiries, let reporters speak to CEO Bob Jordan and other top executives, and posted updates in its newsroom site almost daily. Along the way, executives continually apologized for the crisis and pledged to get back on track.However, observers note the airline\u2019s words didn\u2019t always mesh with its practices.While saying it would address refunds and award loyalty points, it wasn\u2019t immediately clear how much customers would receive, under what circumstances, or when.What\u2019s more, executives were vague about how they would upgrade IT and long-term policies to prevent similarly severe issues from occurring again.Their apologies were unreserved, says Mark DiMassimo, founder of DiMassimo Goldstein (DiGo), a positive behavioral change agency. But that needs to be combined with meaningful actions.\u201cDon\u2019t let your corporation act like a corporation. Act like a person,\u201d he says. \u201cBe transparent. And take that risk of oversharing because there\u2019s often significantly more risk in withholding or delaying what you tell your customers.\u201d      Don\u2019t make customers haters: Connect agency + software strategies instead                If your digital transformation strategy isn't closely connected to your agency, you risk losing customers. Bridge the gap NOW.      Southwest Airlines, post-meltdownNo doubt, Southwest will survive its holiday meltdown. Even though it faces federal investigations and hefty fines for possible regulatory violations, the airline offers relatively low prices and cheerful flight attendants without annoyances like baggage and change fees \u2013 all of which are likely to appeal to forgiving travelers.But it may not be the same Southwest for a while. Indeed, having been brought down to Earth, it will take time and resolve for the airline to re-ascend to its status as the darling of the U.S. airline industry.\u201cWe expect to see Southwest take a pretty big hit from this in the short run,\u201d DiMassimo says.\u201cWhen you piss people off, there\u2019s usually a big short-term cost to growth. However, in an environment where almost all air travel is awful, there\u2019s an opportunity for Southwest to tap into their brand heritage and recover.\u201d  Don\u2019t meet travelers\u2019 expectations.Exceed them.","wordCount":1193,"image":{"@type":"ImageObject","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/southwest-airlines-metldown-FTR-.jpeg","height":375,"width":1200,"@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2023\/01\/southwest-airlines-metldown-FTR-.jpeg"},"author":{"@type":"Person","image":{"@type":"ImageObject","url":"https:\/\/secure.gravatar.com\/avatar\/c437b2aea84e78e5b508c12698f73553?s=96&d=mm&r=g","height":96,"width":96,"@id":"https:\/\/secure.gravatar.com\/avatar\/c437b2aea84e78e5b508c12698f73553?s=96&d=mm&r=g"},"url":"https:\/\/www.the-future-of-commerce.com\/contributor\/david-rand\/","name":"David Rand","identifier":662,"@id":"https:\/\/www.the-future-of-commerce.com\/contributor\/david-rand\/#Person"},"publisher":{"@type":"Organization","logo":{"@type":"ImageObject","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/themes\/hybris_foc\/assets\/images\/layout\/logo-foc-2x.svg","height":"96","width":"293","@id":"https:\/\/www.the-future-of-commerce.com\/wp-content\/themes\/hybris_foc\/assets\/images\/layout\/logo-foc-2x.svg"},"address":{"@type":"PostalAddress","name":"The Future of Commerce","addressCountry":"https:\/\/www.the-future-of-commerce.com\/#Country","addressLocality":"Newtown Square","addressRegion":"PA","postalCode":"19073","streetAddress":"3999 West Chester Pike","@id":"https:\/\/www.the-future-of-commerce.com\/#PostalAddress"},"url":"https:\/\/www.the-future-of-commerce.com\/","alternateName":"The Future of Commerce and Customer Engagement","additionalType":"news media","name":"The Future of Commerce","description":"News, information, and analysis on the future of commerce, including e-commerce, customer engagement, B2B, B2C, DTC, supply chain, sustainability, and purpose.","sameAs":["https:\/\/www.linkedin.com\/groups\/4844282","https:\/\/podcasts.apple.com\/us\/podcast\/a-call-for-a-better-experience\/id1479742201","https:\/\/twitter.com\/FutureOfCEC","https:\/\/www.the-future-of-commerce.com\/feed\/"],"contactPoint":"https:\/\/www.the-future-of-commerce.com\/#ContactPoint","legalName":"The Future of Commerce","parentOrganization":"https:\/\/www.sap.com\/index.html#Organization","numberOfEmployees":"https:\/\/www.the-future-of-commerce.com\/#QuantitativeValue","@id":"https:\/\/www.the-future-of-commerce.com\/"},"@id":"https:\/\/www.the-future-of-commerce.com\/2023\/01\/17\/southwest-airlines-meltdown-lessons\/#BlogPosting"},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"2023","item":"https:\/\/www.the-future-of-commerce.com\/2023\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"01","item":"https:\/\/www.the-future-of-commerce.com\/2023\/\/01\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"17","item":"https:\/\/www.the-future-of-commerce.com\/2023\/\/01\/\/17\/#breadcrumbitem"},{"@type":"ListItem","position":4,"name":"Southwest Airlines meltdown: 4 business lessons","item":"https:\/\/www.the-future-of-commerce.com\/2023\/01\/17\/southwest-airlines-meltdown-lessons\/#breadcrumbitem"}]}]