If you intend to create a social media strategy in house then this infographic is a useful tool that will help you determine how to use the most popular social media tools and where to focus resources. It’s not perfect and it is US centric but local research has shown consumers in South East Asia are not that different in the way they engage with social media.
Thanks to Buffer social for the excellent infographic
I was shocked to see this ad appear on my Facebook page this morning.
Is anyone in control of marketing at Malaysia Airlines at the moment or has the transition to the new company already started? At the same time as the world’s media is showing terribly sad but dignified video and images of the crew of MH17 returning to Malaysia in flag draped coffins, the airline’s marketing department launches an advertising campaign with a grammatically incorrect tagline telling us flying with Malaysia Airlines is fun.
Are they mad? Does the marketing team really think they can convince us that the experience of flying MAS is going to be fun? Should they be trying to do that? Do they think they can change global perceptions of MAS with a grammatically incorrect tagline? Actually they are not trying to change perceptions, they are trying to change reality, with ads! Not only is it offensive, it is ignorant and they really should know better.
This is the second poorly conceived tactical ad MAS has released online in the last month and it smacks of desperation. There is enormous pressure on the management at MAS but they need to get their act together and start rebuilding the brand and not simply throw out poorly thought out tactical ads or what I can only assume are seen as quick fix solutions. The rebuilding of the brand will start by rebuilding trust and faith in the brand but not with this rubbish.
Last year, when JWT India created an offensive ad featuring Silvio Berlusconi in a Ford Figo with girls bound, gagged and crying in the boot of his car JWT fired the executives responsible and Ford apologized.
MAS doesn’t need to apologise but the management must reevaluate their marketing team and their ad agency needs to fire the clowns who created this nonsense.
Then the managment needs to understand that rebuilding the reputation of the brand is a strategic initiative and not a tacticial one. And the CEO needs to have his finger on the brand pulse otherwise this sort of incompetence will continue and there will be a further erosion in the brand’s reputation.
The recent announcement by the Malaysian government that it will invest RM6 billion of public funds to revive Malaysia Airlines (MAS) is a good idea and one that should be welcome by every Malaysian.
The national carrier is a source of immense pride for Malaysians and so it should be. In the broader perspective, MAS has an exemplary safety record, provides direct and indirect employment for thousands of Malaysians and was profitable for many years.
Furthermore, when managed effectively and innovatively and when the importance of morale was understood, the national airline played a major role in defining the Malaysia Nation Brand as it was the first touch point for many of the more than 10 million passengers carried annually.
Moreover, through MAS, Malaysia got the opportunity to reach out to consumers with a physical product, develop a relationship with them and build a profitable business at the same time. Many of the millions of Europeans who flew the ‘kangaroo route’ from Europe to Australia and New Zealand became brand ambassadors for the carrier.
Much of that goodwill has been eroded but the brand is still intact but there is a lot of work to be done to rebuild global trust in the brand. The recovery plan that will require sweetheart deals to be renegotiated, staff numbers to be reduced and other major restructuring initiatives are just the beginning. Rebuilding internal branding and developing a strong, innovative, customer focused external brand strategy will be just as important.
While the airline restructures, it needs to continue to operate. In June 2014, when MAS CEO Ahmad Jauhari Yahya told shareholders that the MH370 incident had “sadly now added an entirely unexpected dimension, damaging our brand and our business reputation, and accelerating the urgency for radical change”, I was expecting, well radical change.
Externally, it looks like that radical change consists of nothing more than slashing prices!
MAS is reported to be offering cut price ticket prices from the UK, Australia and New Zealand to Kuala Lumpur in an attempt to do what regional senior vice president Lee Poh Kait termed as, “inspire and encourage customers to dream, plan and book their next holiday, and help rebuild trust in Malaysia Airlines.”
Mr Lee also told Australian news site news.com.au that, “With unbelievable savings, these deals are a very competitive offering as we build a stronger Malaysia Airlines.”
He also went on to say, “We are committed to regaining the confidence of our customers and sending them on memorable holiday experiences as a trusted five-star carrier.”
In addition to slashing prices, MAS also launched ‘My Ultimate Bucket List’ competition with 12 return flights to Kuala Lumpur and 4 iPads as prizes.
Its not uncommon for bricks and mortar retailers to slash prices in the face of poor sales and it’s a familiar tactic of low cost carriers looking to sell excess seats. The idea is you attract new customers who might not have bought from you and you get a spike in sales that will get you through the lean times. But we’re not selling soap powder, software or biscuits.
An international airline that competes in the same space as Singapore Airlines, Cathay Pacific and the increasingly aggressive Middle Eastern carriers and is reeling from two tragic events is not going to build a stronger airline or rebuild trust by slashing prices.
Slashing prices gives the impression the project is cheap, something MAS cannot afford to do. It also smacks of desperation and lowers the value of the product to that of a low cost carrier and may well cause customers to lose not rebuild confidence in the airline.
Furthermore, by slashing prices, MAS is throwing away all of the pricing power it has built up over the past few years, power that will take years to win it back.
The regional senior vice president also said “We would like to thank all our travel agency partners and passengers for their relentless support during what has been a difficult period.” I understand that MAS has also doubled the travel agent commission rate to 11% till mid September.
At the same time as this seat sale and travel agent incentive is launched, the MAS frequent flyer programme (FFP) Enrich is sending emails out to 14 year olds offering them the opportunity to earn extra air miles if they book a hotel with the MAS hotel booking partner. Not many 14 year olds book hotels.
Enrich marketing is sending out up to 8 emails a month asking members to play golf at the Mines, get double miles when they fly with Firefly, take advantage of a sale at shoe shop Lewre and various other offers.
After flights, the airline is also sending an email to travellers asking them to complete a survey that asks questions such as “At which airport did you board/leave this flight?” and “Class of travel” as well as questions that the answers might be good to know but don’t identify causes of dissatisfaction or provide any real actionable data.
Meanwhile, while MAS offers travel agents double commission on bookings, MAS loyalists who have flown more than 20 times since MH370 went missing in April 2014 haven’t received personalized communications from the airline thanking them for their support or an offer of free air miles, upgrades or other shows of appreciation.
Based on this evidence, it would appear MAS has essentially ignored its existing customers and frequent flyer members and instead gone out and offered special deals to all and sundry in the hope that enough of them will take the bait and fly the airline.
This discounting approach will do little to regain trust or repair the battered brand. Here are 6 tactical initiatives MAS should be doing to rebuild trust before slashing price:
1. Existing customers are more likely to buy than those who haven’t bought before
Right now a focus on gaining new customers or market share is a misguided approach. Yet MAS, like so many firms is attempting to do just that whilst ignoring its existing customers. The MAS FFP Enrich is rumoured to have more than 1,000,000 members. The database of Enrich members is a potential gold mine of revenue that needs to be cleaned and leveraged properly and quickly with a well planned and implemented programme.
2. All data is important
OK, MAS probably doesn’t need to know the name of every FFP member’s pet but it does need to know enough data to know what products should be sold and to whom and how to increase share of wallet.
Consumers are willing to share more information than ever before and MAS needs to start collecting data and sending the right offers to the right people. Sending invitations to book hotels to 14 year olds is sloppy and shows a lack of professionalism and that will do nothing to rebuild the brand’s reputation.
3. Leverage the power of social media
Each customer’s experience is defined by the economic, experiential and emotional value of each ‘moment of truth’ when interacting with the brand so mass advertising campaigns either online or offline and slashing costs are not going to rebuild the MAS brand.
There is a great deal of sympathy out there for MAS and a bright, real, transparent, honest and consumer driven campaign on social media about real people travelling on MAS will inspire more people to develop a relationship with the airline (and relationships are the goal, not selling seats) than any seat sale with a weak call to action.
4. Branding is about experiences and relationships, not one off sales
Few consumers are going to develop a relationship with a brand based on a one off sale. And besides, legacy carriers can’t compete with LCCs and the moment MAS tries to increase prices, those customers won on price will go elsewhere. MAS must start building relationships with its customers and leverage those relationships to increase sales.
The success of those relationships will be determined at every touch point which means the website booking engine, check in staff, customer service representatives, ground and airport staff, cabin crew, in flight entertainment, comfort and service, baggage operators, communications, helplines and more must be all be ‘on brand’ and on top of their game at all times.
5. Stop being lazy and start re building the MAS brand
There is no short cut to rebuilding the MAS brand. It is going to take a lot of effort strategically and tactically. Slashing prices and flooding the Internet with forgettable, price driven ads won’t turn the company around. The MAS website has been a mess for too long. No matter what the cost, funds must be made available to fix the booking machine and fix it quickly.
It’s also time to retrain front line staff as they currently do not have the skillsets required to deliver a premium brand that can compete with the aggressive ME carriers.
6. Think customer not customers
The customer is only interested in one thing, what’s in it for me (WIIFM). Yes many of them care about the airline but they aren’t about to risk their lives or those of their families.
Every single customer flying MAS in these difficult times has to be made to feel special (this should be part of the brand strategy but is particularly important now).
Those customers flying MAS now are the saviours of the brand and must be nurtured to become brand ambassadors and brand advocates who will be talking loudly about the fact that they are flying the airline now.
Make the experience a memorable one and they will talk loudly and for longer and do more to rebuild trust that any corporate driven advertising or PR campaign.
None of this is rocket science but these 6 top tactical tips will lay the foundations for the rebuilding of the Malaysia Airlines reputation quicker and more effectively than slashing prices.
This is the biggest weekend of the year in Malaysia as families across the country go home for the end of Ramadhan Eid holidays. As Monday and Tuesday are public holidays, many people will have a nine day break.
For me personally I’m looking forward to some quality time with my family in Sarawak, one of the best kept secrets in Asia. I’m flying business class to Kuching about an hour and forty minutes flying time from Kuala Lumpur.
When I get to the airport they tell me my flight is delayed. Now I’m a little bit annoyed by this because I’ve been a member of their FFP since it began and they have my email address and mobile number so they could have let me know the flight was delayed. But hey, that’s a minor issue and besides, if it’s a technical problem I’d prefer them to discover it on the ground and not in the air. Incidentally when I checked in, there was no apology from the girl at the desk.
MAS is carrying out renovations to its lounge at KLIA so I am directed to a temporary lounge. When I get to the lounge I show my boarding card to the person at the counter who looks at it and hands it back. There is no mention of flight announcements. The greeting isn’t rude but it’s hardly enthusiastic.
I sit down and get online. The lounge is quiet, I’m in a good mood, and considering I’m at an airport and about to get on an MAS flight I’m relaxed and excited at the prospect of spending some quality time with my family in a beautiful place.
30 minutes later I get to that point in an airport where you feel like you need reassurance that everything is alright. So I go to the counter and ask about my flight. I’m told it is delayed (like I didn’t know that) and the staff member points to a time on the boarding card and mumbles something incoherent.
I don’t know about you but when I’m at an airport there are so many distractions, so many unusual assaults on the senses that I rarely pay attention to announcements however, a little later, I suddenly look up and realize I haven’t heard an announcement about my flight or for that matter any others. I ask one of the MAS staff in the lounge what is happening with my flight. She goes to the desk and comes back and tells me my flight has left!
I’m stunned and ask someone to explain what just happened. The explanation revolves around the fact that it is a temporary lounge and they don’t make announcements and anyway, there is a sign on the desk stating that there won’t be any announcements.
Now bearing in mind getting passengers to the plane is a fairly important part of an airline’s responsibility, the sign below can hardly be described as adequate, especially with all the other messages on the desk.
Understandably I’m not impressed. This is business class, there aren’t many people waiting and it wouldn’t take much effort on the part of the staff to inform the few passengers in the lounge that their flight was boarding. Furthermore, if one business class passenger is late arriving at the departure gate, how much effort does it take for the staff at the gate to call the business class lounge and ask if the passenger is there? Aren’t these the little things that help passengers justify paying more for a ticket?
For some reason I’m then sent to the flight transfer counter where I listen to a staff member explain my situation to other staff members who all look like the last thing they want to be doing right now is deal with this issue. No one tells me anything. Eventually after interrupting the conversation I learn that my luggage has been sent to lost and found and I have to go and get it and not to worry, I will be put on the next flight.
I then go back to the lounge and 10 minutes later another member of staff tells me that I have to go and get my luggage because he doesn’t have the authority put it on the next flight which is odd because someone had the authority to take it off the previous aircraft and send it to lost and found but most galling of all, he tries to nickel and dime me for RM150 penalty to change to the 5.55pm flight!
He’s not very happy with the fact that I’m not very happy but obviously is just following a procedure and not interpreting the situation as it is. I realise he doesn’t have any authority so ask him to send a supervisor to talk to me. He walks off to the desk and sits down. 30 minutes later he is still there and making no effort to update me so I have to go and find out what is happening. He tells me the supervisor will be here in 10 minutes.
25 minutes later I get up again and go and ask him what is going on. He says the supervisor will be there soon. As we’re talking the supervisor arrives. She manages to talk to another supervisor who agrees not to charge me the RM150 penalty. It has taken me a lot of effort to get to this stage.
But it doesn’t get better just yet. It transpires that I wasn’t put on the 5.55pm flight, I was put on the waiting list because the flight was full. No one told me this. I asked what time is the next flight, answer 6.30pm but it is also full. The next flight after that with seats is 7.30pm. By the time I board that flight I will have been at the airport for six hours.
So how is related to the problems at MAS?
Throughout this horrendous experience I felt that on the whole, with the exception of a couple of members the staff were sympathetic to my predicament and wanted to help. But the problem is they just didn’t have the knowledge or the skills to deal with the situation effectively.
Being told repeatedly that the lounge is temporary and therefore there won’t be any announcements is not good enough but it isn’t the fault of the staff. It suggests the company doesn’t understand the importance of the customer. Especially highly profitable business class passengers.
It’s great that you are renovating the lounge but it doesn’t mean you lower your standards in a temporary lounge. It might be temporary to you but to every passenger, it is still the lounge. It’s not like I’m paying less for my ticket because I am using a temporary lounge. Does it mean that when you lease an aircraft from another airline you lower your engineering or safety standards?
And besides we’re talking about the worst time in the airlines history. Shouldn’t every customer willing to spend money with the airline at this difficult stage be appreciated more?
The attitude of the lounge staff was at best adequate. I got the feeling they were doing the job but nothing more. And having flown Malaysian Airlines for over 20 years I have to say I’ve felt this way for the last 12 – 15 years.
If the MAS brand is to survive, those that make the decisions on training have got to understand that the airline is not doing passengers a favour. Numerous reports released over the last 5 years point to service as being the main factor influencing consumer brand choices.
In every report I have read recently, the averages percentage of people who switch brands because of poor service is around 70% and goes as as high as 80%. It is universally accepted that customer service is critical to the success of a brand. That service comes from effective and timely training based on the changing needs of customers.
The issue is that what may have been considered acceptable customer service yesterday is no longer acceptable today. Moreover, as more and more companies raise the bar in terms of the quality of service they deliver, consumers expect more. Training needs to be updated and reinforced.
Nowadays, for an Asian carrier to thrive let alone survive, it has to have a culture not of customer service but of exceptional customer service. The ability to deliver exceptional customer service is the only way brands can build the loyalty that will differentiate themselves from other competitor brands.
Armed with the skills and tools needed to deliver exceptional customer service, staff will have the ability, confidence and enthusiasm to go the ‘extra mile’ when dealing with their customers.
Malaysia Airlines is a service product in a very competitive space. Despite the two very tragic incidents in the last 5 months numerous customers such as my family and I have stuck by them.
Right now it is tough being loyal to MAS and it isn’t made easier when they can’t even get the basics right. I, like many loyal customers don’t want any special treatment but I do expect a decent level of service.
As I write this, there is talk in the UK newspapers of a strategic review of MAS that may include renaming and rebranding the airline. I don’t know what they define as a rebrand but it’ll take more than a change of name to save MAS.
A few airlines have started thinking out of the box when developing their brands. Over the last couple of years Virgin and Air New Zealand have gained a reputation for creating innovative safety videos that go viral and build positive brand reputation.
You can see some of the videos in this earlier blog post. Combined, these safety videos have generated over 30 million views, more than 100,000 Likes and tens of thousands of comments, most of them positive. With such consumer generated power who needs a 30 second TV commercial?
Recently Air New Zealand created a new safety video, this time using cabin crew, Cook Island residents and some rather attractive Sports Illustrated swimwear models. The models show how to put on a seat belt, use an oxygen mask, inflate a life vest and leave the plane in an emergency. All done not on a plane but on a beach or by the pool in the Cook Islands.
All very clever and innovative. Unfortunately an Australian was offended by the ad, calling it sexist, irresponsible, offensive and insensitive to religious sensibilities. She bagan a petition online and soon had over 10,000 signatures, forcing Air New Zealand to pull the video and disable the comments section on Youtube, despite getting more than 11,000 Likes and less than 1,100 Dislikes.
To date the video has generated more than six million views on Youtube and quite a few of them me!. That’s more views than all of Air New Zealand’s previous safety videos combined.
Florian Kaefer who owns the excellent Place Brand Observer Blog drew my attention to a cracking Blog post written by Eduardo Oliviera on the Place Brands Blog.
In his post, Eduardo writes extensively on the number of country and city brand indexes and barometers as well as newspaper ‘best place to be’ and ‘best place to swim’ tables and their rankings and notes that they all use different methodologies and algorithms. Unsurprisingly the rankings differ from one to another and he wonders whether their rankings offer any real benefit.
He says, “The practice of place branding continues this ‘ranking fetish’. People seem to set great stock in rankings or lists such as ‘best of’ or ‘top 10′. But in reality these rankings don’t have as much power as people think. They simply divert focus, resources and effort from what is truly important in place branding.”
He goes on to say, “In the same line of reasoning investors are influenced in their decisions both by very material, quantitative issues (in particular costs and labour force) but also by the reputation of places.”
About the only part of his post that I disagree with is that last comment because as long as the place doesn’t have a seriously bad reputation – and even then there are investors willing to invest – if it offers specific value to an investor that investor will invest.
I’m preparred to get off the fence and say these rankings are meaningless. They have zero impact on a nation or city brand. You cannot create place brand reputation but you can influence it. It grows organically thanks to multiple components that can be influenced and often steered by the very people and other stakeholders invested in the place brand.
Ultimately it has to offer economic, experiential and emotional value to the relevant stakeholder, both internal or external and if it does it can overcome serious setbacks. Which is why countries like America can invade Iraq and upset the Muslim world and still be the number one destination for overseas education for students from Islamic countries.
It has brand credit that has built up over time and it will take a lot to erode that credit. But that credit is intangible and doesn’t need to be measured. What city and nation brands have to focus on is delivering that economic, experiential and emotional value, based on the individuals requirements for that value and they will build a brand that will be the best place to invest, eat in, sleep in, skateboard in and so on.
If Malaysia Airlines (MAS) makes it to 2015 and beyond, 2014 will probably be remembered as an annus horribilis for the beleaguered brand. In fact it may go down as an annus horibilis for the Malaysia Nation brand but we’ll discuss that another day.
Certainly the first half of 2014 has been desperate for MAS with missed revenue targets, ineffecitve advertising campaigns universally mocked by the industry, reports of alleged sabotage, police investigations, negative press about the customer experience and of course the tragic circumstances surrounding MH370 and the subsequent weak handling of the global media by the airline.
The once mighty airline, an early poster boy for national carriers is struggling on a number of fronts with two big questions 1) Can MAS survive and 2) should it be allowed to fail? being asked in coffee shops, boardrooms and even in schools.
The answer to 1) is yes, and to 2) is no.
But to survive, someone is going to have to get very, very tough because MAS is in a mess. Since 2007, MAS has made 3 cash calls to the tune of RM7 billion (US$2.1 billion) and over the last 3 years has accumulated losses of RM4.1 billion (US$1.2 billion). Whatever they are doing isn’t working.
Morale is low, bookings are down especially from normally busy and profitable routes to and from China, the unions are throwing their weight around even though the airline is terribly over staffed – you only need to go to KLIA to see so many staff sitting around doing nothing and I heard one story recently of a new person who arrived to find someone asleep (with a pillow) at his desk.
Just to get an idea of the situation, Singapore airlines (SIA) has a fleet of 104 aircraft (MAS 107), flies to 62 destinations (MAS 61), has revenue of RM36 billion (MAS RM58 billion) and is staffed by 14,000 people (MAS 20,000) and yet in 2012 made RM1.150 billion ( during the same period MAS lost RM400 million).
SIA is flying to the same amount of destinations, operating the same amount of aircraft and using at least 6,000 less employees to do it. It turns over only about 60% of what MAS turns over yet makes an impressive profit.
MAS needs a new strategy but cutting costs is not the way forward. In the interests of nation building and to ensure morale and belief in Malaysia doesn’t plummet further and to turn MAS around quickly, the firm needs to carry out a number of key initiatives immediately starting with
1) All suppliers have to accept that their existing agreements must be cancelled and be given the opportunity to submit new proposals that are acceptable to the airline. If they cannot agree terms, new tenders must be issued.
2) Moving forward, all procurement activities must be done transparently.
3) The unions have to understand that 5,000 staff must go. The government must underwrite any redundancy packages for 12 months to encourage staff to leave and reskill these staff to ensure they find work immediately.
4) Training of staff, especially front line staff has to be ramped up because these people are key to the success of the brand and at the moment their customer engagement skills are simply not good enough. But training providers must be recruited transparently.
5) MAS must review it’s sales policies, processes and systems. Right now they are not leveraging effectively on key opportunities such as the Enrich database.
6) MAS marketing and advertising is stuck in a time warp of mass media mediocrity. It needs to stop wasting huge amounts of money (I was told RM400 million in 2013) on irrelevant advertising campaigns and review it’s marketing approach now.
7) MAS must understand that customers build brands not advertising departments. The new strategy must focus on the customer and delivering economic, experiential and emotional value to its customer segments and on their terms.
8) MAS appears to have 3 brand identities at the moment. It’s a mess and needs to be revamped quickly and there has never been a better time to do it as the MAS brand identity is tired and old and associated with MH370.
9) Successful airline brands today are innovative, creative, nimble and move fast. I remember being in discussions about updating the uniform in 2003. 11 years later it is essentially the same.
10) Years ago MAS aggressively marketed it’s Enrich programme and encouraged anyone to sign up. But the programme is antiquated and a mess. Children get offers to sign up for credit cards, there is limited segmentation and personalisation and opportunities to reward and leverage brand loyalists and identify and nurture influencers are missed.
There is an obsession at the moment that cutting costs is the way to make MAS profitable. It is the wrong approach. However by understanding the importance of branding and spending money on the right brand strategy and integrating that brand strategy with the corporate restructuring plan, significant savings can be made and crucially, those savings (obviously) save the company money but will also generate more income by negating the competition, increasing share of wallet and allowing MAS to increase not decrease ticket prices.
Malaysia Airlines (MAS) embarked on a massive restructuring plan towards the end of 2011 with the goal being to reduce costs and return to full year profitability in 2013.
At the same time, the airline reported a staggering RM2.52 Billion (US$850 million) loss for 2011.
MAS didn’t realise its stated goal because in late February 2014, the national carrier posted a 2013 net loss of RM1.17 billion (US$356 million). This was almost three times the airline’s 2012 net loss of RM432.6 million.
So despite the restructuring plan, MAS lost RM4 billion in 3 years. Ouch.
In 2012, one assumes as part of the restructuring plan, MAS announced a business strategy with two key strategic elements – one to focus on the premium sector and the other to focus on the competitive Asian market.
I don’t know what the airline’s definition of the premium sector is but bearing in mind premium passenger numbers appear flat, a large chunk of its business comes from the domestic government and the price sensitive kangaroo routes, this may be a major challenge.
Furthermore, I’ve seen nor heard of any premium customer strategy or tactics. The ‘Flying in luxury’ section of the March 2014 issue of Going Places offers little insight into what might be happening. Even the benefits of being a platinum member of the Enrich programme haven’t changed in a long time.
Of course they could be referring to the upgrades to the business and first class check in counters at KLIA. Whilst they are an improvement and certainly add an air of exclusivity to the experience, they are hardly ground breaking. And the attitude of some of the staff manning these counters is often indifferent at best.
But I digress. About 18 months ago, MAS announced that it was doubling its marketing budget. The marketing budget is reported to be as much as 2% of revenue which means that in 2012, MAS spent more than RM550 million or US$190 million to focus on the premium sector and the Asian market in an attempt to rebuild it’s battered brand. That’s a tidy sum. Did it work? Based on the latest figures, no.
In 2012, the company announced it will provide a ‘better and more branded customer experience and embark on a major advertising and promotions campaign′.
I don’t know exactly what is ‘a more branded customer experience’ but as a frequent flyer of the airline I haven’t witnessed a change in or better customer experience although the terrifying vibrations at 38,000 feet on a 737 flight from Kuching to KL in January 2014 were new but I don’t think that’s what they meant.
And judging by the negativity across the Internet it would appear few others have experienced an improvement in customer experience.
In 2012 talking about the appointment of Ogilvy and Mather as the airline’s agency, Al Ishal Ishak the senior vice president for marketing and promotions stated, “2012 will be a breakthrough year for Malaysia Airlines on our path to recovery. We recognised, however, that we could not achieve financial success without clearly defining our brand positioning.”
He went on to say, “Ogilvy understood this and throughout the pitch process were best able to translate our message into a powerful campaign idea. An idea that is big enough to help us transform our business and truly engage our customers like never before.”
Judging by the advertising campaign that soon followed, I can only assume that idea revolved around journeys and suitcases. It was, in my humble opinion one of the worst advertising campaigns I have ever seen. I wrote about it here and you can see the TVC below.
What is really depressing about this whole depressingly familiar scenario is that the O&M advertising campaign aims in part to create awareness and drive visitors to the MAS website. And if improvements were to be made to the experience, one would expect logically that the website experience would be the first experiential improvement.
Sadly no, despite a RM550 million marketing budget which I hope wasn’t spent just on the O&M advertising campaign, the first page of the MAS website has a bug in it that frustrates visitors every time and the bug hasn’t been fixed for at least a year!
Another area that one would expect to be addressed during the improvements to the customer experience would be interactions with the customer service department but again, judging by this negative blog posting, the airline has not managed to deliver on its promises.
So now that MAS has posted another net loss, despite doubling it’s marketing budget to clearly define it’s brand positioning and despite not improving the customer experience, what can the airline do now to salvage its reputation and rebuild its brand?
Here are 20 things MAS needs to do now to improve its brand
1) You and the unions need to wake up to reality and appreciate that market conditions are such that unless you get rid of a large number of staff, the airline will be on my list of brands that won’t make it past 2016.
2) The organization is the brand. Many MAS staff are trying really hard but they are let down by those that don’t care. Current middle management systems don’t seem to be working. Fix them.
3) The six principles to turning around an airline and used successfully by Air Canada, ANA and Aeroflot and probably being used by MAS (a logical assumption bearing in mind the influx of management from Air Canada) include a zero compromise on quality of customer service, investments in staff training and better internal and external communications. The company is failing miserably in all these activities and needs to carry out a comprehensive review and overhaul of current practices and service providers in these critical areas.
4) Forget about the big idea. In the social economy, when consumers not companies define brands and those consumers are spoilt for choice and rarely believe what advertisers tell them, the one size fits all ‘clearly defined’ brand positioning campaign is a futile exercise that does nothing more than waste valuable funds. In this case, RM550 million of valuable funds.
5) Focus instead on consistent, ongoing, personalised engagement with each of your very diverse audiences. And start with your Enrich database! Segment that database in a way that allows you to deliver value to relevant segments today and not segments that belong to the 1980s. Travellers are segmenting into smaller niche, groups and individual travellers and they are willing/able to manage the whole process themselves. Talking to them requires more than an advertising campaign. See point 5.
6) FIX THE BLOODY BUG IN YOUR BOOKING ENGINE! It doesn’t matter what it costs just fix it! If your global advertising campaign did make a prospect visit your site and she then had to go through the ridiculous moves required to enter a destination or departure city, they’d soon leave thinking, ‘if they can’t make a simple fix like that, what are they not fixing on their aircraft or elsewhere?’
7) Because it’s so important, your database gets a double mention. A chunk of your brand’s profitability will come from your existing customers. Instead of spending RM550 million on an outdated advertising campaign that seems to want to acquire and retain customers, start to use what is probably one of the most comprehensive databases in South East Asia, properly.
8) Focus. These ‘one-size-fits-all’ advertising campaigns are an expensive exercise in naïve futility. Put an end to them now. If I’m repeating myself its because the marketing budget is being wasted on outdated mass market models.
9) Don’t do social, be social. Pushing one size fits all advertising campaigns out across social media is pointless. It’s not a television or a radio so don’t use it like one. Social is dynamic and you need to be dynamic to get the most out of it. Stop using your Facebook as another broadcast platform. And stop ignoring negative comments and blog posts and instead, engage with the authors.
10) Integrate all your solutions to make it easier for consumers to use them. 40% of business travellers and 25% of leisure travellers in Asia now use mobile or tablets for travel but as far as I can work out, the MAS app (when I can get it to work) isn’t integrated with my online profile. Why not?
11) Stop spending, no wasting huge amounts of money on forgettable mass market advertising campaigns and start building a brand.
12) Train your staff, and start with your customer relationship staff. Whoever is doing it now isn’t doing a good job. Find someone who really wants it and make your staff the best in the world.
13) You have a legion of brand angels out there who are desperate for you to succeed. Do you know who they are? If not, you need to identify influencers and quickly leverage on their passion for your brand.
14) Seek new revenue streams. Of course you are already doing this but there are a couple of opportunities that you are not exploiting and you should be.
15) You are not a low cost carrier so stop trying to be one.
16) Get those new aircraft, now.
17) Stop focussing on costs and start focussing on delivering value.
18) Don’t compromise on anything related to customer touch points, whatever the cost.
19) Image is everything. The change in the look of some aircraft was a great development but what about the rest of the fleet? There seem to be three different liveries for the MAS fleet. And what about the uniforms? A partial change was made to some male uniforms but what happened to the rest of them? Is this a strategic project or an ad hoc one? Whatever it is, consistency in a brand image is a must.
20) One last comment on segmentation. Each segment within each country has completely different requirements for value. In Indonesia small businesses employ 80% of employees. In Malaysia, SMEs account for as much as 99% of businesses. In Japan, 20% of leisure travel is by the over 65s. What do you know about these segments and do you have a brand strategy to communicate with them?
Not many legacy carriers have remained profitable following the intense competition in the airline industry. Even without the massive interference of the governments of the past, MAS has found it tough to adapt to increased customer expectations, LCC competition, fluctuating fuel prices and rising costs.
The days of using cost cutting and outdated mass marketing communications campaigns to drive restructuring plans are over. The future will require an even more nimble approach and a focus on delivering value to diverse segments on their terms.
Only then can MAS out maneuver budget airlines and other new entrants into the market and become profitable once again.
DHL understands better than most that a traditional advertising campaign is expensive and ineffective. But it still wanted to market itself, especially in the face of more efficient and effective competition.
So the firm decided to trick its competitors into advertising DHL across a city in the US.
DHL sent packages via competitors such as TNT and UPS to addresses that were awkward to deliver to. To ensure they weren’t caught the boxes were covered with a special ink that turned black when the boxes were chilled to sub-zero temperatures.
The ink was temperature-activated and as it warmed up, the ink faded revealing a large message that said “DHL is faster.”
The poor deliverymen had to struggle through crowds to deliver the large boxes. Whilst it’s unlikely many people actually noticed anything but it is bound to get a lot of viral exposure.
I’m looking forward to the response from UPS and the others!
Business today is brutally competitive. Many brands that have done the hard graft to get to the top of their industry, fail to stay there. It used to be that if you made it to the top you were sitting pretty. Not anymore, getting to the top is the easy part. Staying there is now the difficult bit.
Just ask these 5 brands who are unlikely to make it to Christmas 2014.
5 VOLVO
Volvo doesn’t appear to have a sound strategy for Asia and the US markets. Read more about Volvo’s fragmented communications campaigns with different messages.
Crucially, Volvo doesn’t have enough models and is forced to compete in Asia and the US with entry level vehicles from luxury marques Audi, BMW and Mercedes as well as giants like Toyota and GM.
In the United States, Volvo’s market share hovers around the 0.3% mark. In Thailand, the largest automotive industry in South East Asia and the 9th largest in the world, Volvo has had a presence since the mid 1970s yet it only sells around 2,000 cars a year out of a predicted 1.3 million vehicle sales for 2013. In Malaysia it’s less than 1,500 out of a total industry volume of almost 600,000.
Volvo was bought by China’s Geely group in 2010 for US$1.6 billion. Geely targetted sales of 200,000 cars a year in China by 2015. To meet these targets, it’s rumoured that the dealers in mainland China inflated sales figures to generate cash incentives that should have gone to customers but were in fact retained by the sales force. It’s thought that as many as 20% of sales in China were ‘fake’.
A messy marketing approach, limited models and falling sales in key developing markets. Volvo needs to get its act together quickly if it wants to be around in 2015.
4 NOKIA
The Finnish handset giant has gone from hero to zero in a heartbeat. In 2010 Nokia, sold 450 million handsets, outselling Apple 10 to one.
But Nokia’s mobile phone market share was already falling, from a high of 36.4% to 28.9% in 2010.
In 2012 the firm sold 16 million of its flagship Lumia handsets. In the same period, Samsung sold 384 mobile phones while Apple sold 125 million iPhones.
Nokia makes great phones. The trouble is consumers don’ want great phones they want great smartphones and a smartphone needs a good operating system.
And Nokia made the mistake of backing the wrong OS horse when it backed Windows mobile. A big mistake that it acknowledged when it went public with its frustrations with Microsoft’s failure to give smartphone users a good enough reason for using Windows.
As 2013 closes, Nokia is worth 10% of what it was 5 years ago and tragic though it is, Nokia is probably doomed.
3 DELL
Dell makes PCs. Lots of them and very cheaply. In 2000 it made more and sold more than any other company. Dell used to have very good customer service but somewhere along the way, Dell stopped focussing on its customers and focussed instead on producing cheap PCs.
But as Dell is finding out the hard way, cheap is not a differentiator. Worse still and unfortunately for Dell, global PC sales are tumbling as tablet sales skyrocket. So it now has a larger share of a declining market and a poor reputation with customers (a death sentence in the social economy if every there was one). No doubt this is major factor in the fact that in its fiscal second quarter, net income was down 72% from the same period a year earlier. That’s not good.
In September 2013 Dell shareholders approved a US$25 billion buy out by the founder Michael Dell and Silver Lake. This will allow Mr Dell to make acquisitions, increase R&D spend and target new markets away from the scrutiny of Wall Street. Mr Dell has also expressed considerable interest in next generation cloud based services to improve the way businesses operate.
This may keep Dell alive past December 2014 but it will be a very different company to the one we know now.
2. WINDOWS
In the mid 1990s Windows had over 90% of the computer operating system business. Today that share has shrunk to about 15% for sales of new devices and according to Gartner it is unlikely Windows will ever get back much above 15%.
Windows 8, launched at the end of 2012 was supposed to give the mobile operating system a boost but it failed to ignite much interest and Windows phone now has 2.9% of the smartphone operating system market.
This despite advertising spend of more than US$9 billion over the last 10 years. Windows is probably too big to fail, but if Microsoft doesn’t sort out experiential problems with Windows, especially Windows mobile it may well crash and burn in 2014.
1 BLACKBERRY
The BlackBerry story is the most tragic of corporate tales. Originally Research in Motion, the company was renamed in 2014 but that hasn’t helped the company arrest rapidly declining sales and revenues.
At its peak, BlackBerry was the third biggest handset maker, thanks mainly to its BlackBerry messenger that allowed users to send messages to each other for free.
For a while a BlackBerry was a major status symbol in Asia, especially for aspiring teens. But that all changed with Whatsapp and other free services and since then, BlackBerry has lost ground to Apple, Samsung, LG and other mostly Asian smartphone makers who are more nimble and aware of changing consumer needs.
New models and a revamped operating system were launched in 2013 but they failed to have much impact and in 3Q2013 BlackBerry revenue was down 56% over the same period in 2012.
Towards the end of 2013 over 4,500 staff or 40% of the workforce were made redundant and the firm is desperately trying to reduce expenses by a further 50%.
The one bright light is the BlackBerry Enterprise Server (BES 10) that has seen a rise in installations in 2013. Revenue from this ‘service’ business makes up half of the company’s income. If anything happens to BES 10 the firm will go under.
Why these 5 brands? I used a simple methodology to determine which brands are likely to fail. The key elements of the methodology are:
1. Reported sales figures
2. Competitor reported sales figures
3. Anecdotal reports of physical experiences with the brands
4. Professional view of the brand’s communications over a 12 month period
5. Manual tracking of Social media discussions by their existing or lost customers over a 2 month period
Let’s hope I got it completely wrong and these great brands are still around in January 2015.
brandconsultantasia.com 