Wednesday, February 17, 2010

Case Study: United Breaks Guitars

Customer service is around us everyday. People experience it as they dine at restaurants, visit the grocery store, buy a car, stay at a hotel or any form of company/customer relations. A consumer can never anticipate how they will be treated during their experience with a company. Most companies are proud of their excellent customer service and those companies who hold true to their claim maintain a high clientele and are referred to by satisfied customers. Other companies with poor reputations often lose customers and are most likely unsuccessful. United Airlines is a company that claims to have high quality customer service, but Dave Carroll and 13,517 other people claiming “baggage reports” would beg to differ.

The employees at United Airlines signed themselves up for their job—they knew they would deal with customers everyday and all day. And because they chose to work in the positions they do, they should be ready and willing to deal with customers problems, no matter how small or severe they may be. A company should approach a problem before they get out of hand.

Confusion and lack of responsibility were the key components leading to the embarrassment Dave Carroll has put upon United. In this case, United caused Dave to make many phone calls all leading him to someone else in the company.

“The system is designed to frustrate affected customers into giving up their claims and United is very good at it,” Carroll said. United could have paid for the damage done to Dave Carroll’s guitar, but they refused. After two million views of Carroll’s video, “United Breaks Guitars,” which depicts his experience, United has lost $180 million in their stocks. They could have spent $3,000 and fixed the problem, but instead their lack of responsibility and leadership has cost them more than they ever would have expected. United’s public relations people didn’t stepped up and meet the challenge to satisfy a customer, now they are experiencing poor imaging for their company and losing a good amount of money—which I think serves them right.

3 comments:

  1. I liked the comparison you made between the money they actually lost in stocks, and the money they would have lost by just buying him a new guitar. I think companies realizing the customer service is important would save them a lot of headaches.

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  2. I agree with you. Poor customer service can snowball into such a huge PR nightmare. Quality customer relations should be the core value of any business. United really dropped the guitar...I mean the ball on this one.

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  3. One thing to keep in mind though is that even though this was a PR nightmare, United, along with many other airlines have had huge problems for quite some time now so to say that this incident caused their stock to plummit, even though that is not exactly what you are saying, is a little exaggerated...

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