CEO Blog

The underestimated link between customer expectations and loyalty

Written by Ravindra Bhagwanani on . Posted in CEO Blog


30 October 2015

High profile airlines love to create high customer expectations as part of their marketing strategy. But do they overlook that this can actually have a negative impact on customer loyalty?

Although they don’t have an FFP, I admit that I cannot always avoid taking easyJet, the second largest carrier and having nevertheless a market share of some 20% in Toulouse. And when taking easyJet, my expectations are very low as I know what I can expect from their product. Basically if they get me on time to my destination, I am okay. And if my baggage arrives on the same flight, I consider this a reason to invite all my friends for a big celebration.

Okay, I’ve never had to go that far (only one of all my flights with them in the last two years was on time), but I think you get my theoretical point. Just replace easyJet by any other more reliable low cost carrier in my example – maybe even throw in some loyalty points – and the demonstration could work just nicely. Or as Southwest’s legendary Herb Kelleher put it once: the secret is to create no expectations among passengers, but then to exceed them. In other words, teach your customers to take a free bag of peanuts as something unexpected and precious and there are big chances that you can make them happy.

On the other side of the spectrum, you have the Gulf carriers and to a lesser extent the legacy Asian carriers such as Singapore Airlines. Their marketing departments definitely do a good job to make you appetite to try their products. But the day you actually do it, you step on the plane with such high expectations that there is a real risk of being disappointed. The smallest flaw in the delivery of the product – which can obviously very easily happen in such a complex environment as the airline business, as we all know – will let you leave disappointed although the overall product experience will in any case stay far above most other airlines you would usually fly.

As example for over-creating expectations, let me just take the latest promo video of Emirates, featuring Jennifer Aniston: How many normal customers would really read the fine print in the middle of the video to understand that showers are only available in First Class on only one of their aircraft types they operate? There are probably more than 4 million people out there now having watched this video and being convinced that they will experience all that on their next Emirates flights, even when flying in Economy Class… How will they react when discovering the truth? Blaming themselves for not having read the fine print? Hardly.

Personally, I’ve often left one of these airlines – in different cabins – with such a slight feeling of disappointment. And that is where the problem lies: Disappointment is the big enemy of any loyalty marketer, who needs to build on a positive customer experience. No loyalty program can overcome shortcomings on the product side. And whether these shortcomings are real or just perceived as such by customers doesn’t really make any difference. As I have to go a bit out of my way to fly with the Gulf carriers anyway, my past experiences often stayed below expectations and were therefore not lasting enough as they would really manage to create a natural loyalty towards them, making me also somewhat immune to any well-intended efforts they might do at the FFP level.

The sad news for the traditional loyalty marketer here is that there are limitations of what he can achieve on his own. And usually any Customer Experience Management function is situated far away from him within the organisation. But in the future, a stronger cross-functional influence of the loyalty department across the internal organisation will definitely be required in order to take loyalty practices to the next level.

Interestingly enough, this problem is not limited to these star carriers, but also to other airlines (or hotels) with a strong PR and social media presence. It is safe to expect that some 150 WestJet passengers will soon get a Christmas surprise again this year. However, the airline will carry another 1 million passengers in the pre-Christmas period with many of them being a bit disappointed that they were on the wrong flight.

While PR departments and agencies measure their success by YouTube views, social media posts etc., this might not be the right measurement. The interesting question would be to measure how much of that traction can really be converted into a) new loyal customers, b) doesn’t target the right audience at all or c) creates an interest to test the product, but disappoints customers afterwards. In today’s reality, I am afraid that a) is so tiny compared to b) – which is at least cost neutral -, but also to c), where companies can actually lose a lot of money, that many PR activities would not survive any slightly harsher scrutiny.

In conclusion, probably no airline has a sufficiently consistent product immune from any potential disturbing external and internal factors as that it should really take the risk of creating too high expectations, but many do exactly that (marketing departments also need to justify their raison d’être!). There are a handful of people, who understand the airline business beyond their own company and get things right. Herb Kelleher was certainly one of them.