Slashing prices will not rebuild trust in MAS. 6 top tactics to resuscitate the MAS brand quickly


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.

MAS a national icon worth saving
MAS a national icon worth saving

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!

Slashing prices won't build confidence in the MAS brand
Slashing prices won’t build confidence in the MAS brand

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.

THe lastest MAS online ads are easily forgotten
THe lastest MAS online ads are easily forgotten

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.

Used properly, the MAS FFP database is a potential revenue gold mine
Used properly, the MAS FFP database is a potential revenue gold mine

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.

Good to know but how can the answers help rebuild the MAS brand?
Good to know but how can the answers help rebuild the MAS brand?

 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.

Great tips for using email to build your brand


More and more firms are using effective email campaigns in association with their social media initiatives to build brands. This is because an email campaign allows you to know who is opening your emails, which links they’re clicking on and how many of your them are forwarding your emails to their friends. The right product also means you will only pay when a recipient clicks through to the offer.

Malaysian firms are slowly waking up to the benefits of a good email campaign. Let me put that differently, Malaysian firms are waking up to the fact that email is an effective marketing tool. Which is good timing because according to a recent report from MarketingProfs, email returns the highest return on investment (ROI).

The problem is that too many Malaysian firms are trying to do their email campaigns ‘on the cheap’. often they do it inhouse or if they do outsource, they outsource to the cheapest company.

This means they often send out poor quality emails that can damage the brand. it is important to get the email and the content of your email right. Because this is the first interaction a potential customer will have with your brand. It is a great opportunity to make a good impression and start building the foundations you need to earn their trust and eventually make a sale.

Unfortunately, it is also a great opportunity to make a bad impression. And once you’ve made a bad impression, it is very dificult to build trust with a consumer who is already forming a negative opinion of you and your brand.

Not only should your email campaign resonate with your target markets, it also needs to be well written and to the point. If it is full of poor English or grammatical errors, you will create a bad impression with the recipient.

Below are two examples of emails I received recently. Although I haven’t included the subject line, take it from me they were almost as bad as the copy.

poor proof readingterrible email copy

How to create a good email campaign
When you prepare an email campaign, the subject line is the most important element of the exercise because this is the first thing the recipient will see.

If there are spelling mistakes in the subject line, the reader will not have any faith in what you say from there on in. If you make outrageous claims in the subject line, the email will go straight to the trash.

Finally, if the subject line doesn’t state its point concisely, it will be ignored. Accept that it is impossible to include content in a subject line that will appeal to everyone on your mailing list. It may take more time but it is better to break up your database and rewrite different subject lines and body copy for different segments.

Once you get to the body of the email, a good rule of thumb is that less is more. Don’t waffle on and on about how great is your product or use textbook marketing jargon that confuses the reader and drives them away from the product.

Keep the email simple. Remember, you are not trying to make a sale, only get the recipient to interact with your brand. Explain what you have to offer, where the recipient can get it or gather more information, who you are and why they should buy your product or service.

Finally and most importantly, focus more on the benefits of your product not the features.

Get the message right, and email is an effective and inexpensive way to make sales, grow your customer base and build a valuable, profitable brand. Used wrongly and it is a complete waste of your time and the recipient’s time and instead of making sales and building your brand you will actually damage your brand.

Direct marketing and your brand


More and more companies are moving toward a direct to consumer sales model. There are a number of reasons for this and it can be a tricky process to implement without upsetting the existing distribution ecosystem but let’s not go there for now.

But this move will see an increase in Direct Marketing. Direct Marketing should be included in any Malaysian business’s brand strategy, whether business to business or business to consumer. And it is a tactic that has plenty of room for growth as it is currently under appreciated and under utilized.

Because the quality of Direct Marketing in Malaysia and the mining and management of data must improve before consumers will pay attention.

What is direct marketing?
In a nutshell, direct marketing is the way in which a supplier of goods or services contacts an end user, normally a consumer or business. Direct marketing includes any mail sent via traditional post or email, brochures, magazine inserts, leaflets and catalogs.

With the direct to consumer sales model, it is also common to include telemarketing and face to face sales as elements of direct marketing

The existing model
If you want to at best create a bad first impression of your brand and at worst ensure an instant negative impact on the reputation of your brand, prepare a badly written product or services document on your desktop, use fonts that are hard to read or have a thick bold type face and whatever you do, don’t spell check the document.

Next, print 10,000 copies and shove them in letterboxes at office and/or apartment complexes in the Klang Valley. Don’t bother to record how many are delivered to each destination and ignore whether or not your product or service has any relevance to the occupants.

Then go back to your office and wait for the phone to ring (assuming you included your number on the document – and believe me, some don’t).

With this approach, the best you can hope for is that the leaflet will be used as a place mat for lunch or simply allowed to fall on the floor by the letterboxes. Hardly an inspiring ‘moment of truth’ first time experience for your brand and potential customers.

If there isn’t a response to the exercise, does this mean the ‘Direct Marketing campaign’ is unsuccessful? Absolutely not, what it means is that a very good tool has been used wrongly.

Another way to damage your brand is to send the wrong material to the wrong people. Credit card companies are renowned for sending credit card application forms to children.

Why am I receiving this sort of mail? – Note to self, do not use this company for training.

Little wonder consumers lose faith in financial institutions when they make such glaring mistakes. Think of the money wasted on buying the list of names, designing and writing content for brochures, envelopes, postage, administration and so on.

Email is still one of the most effective forms of communication with open rates of 22%, click through rates of 8% and conversion rates of 1.5%. But it must be done properly. The common approach is to buy a list of names (normally the cheapest) and carpet bomb that list with every offering you have.

Conference and training providers do this. They don’t bother who the recipient is and what he does, they simply fire off an email offering agile this, scrum that to their mailing list each time they have a new event or training seminar. Research suggests most executives have a spam filter that directs this mail straight to the trash.

The UK has some of the toughest privacy laws in the world yet Direct Marketing is still one of the most effective forms of brand development.

In 2011, UK firms spent RM14.5 billion on direct marketing which was responsible for 23% of all sales and generated RM196 billion of business. Direct marketing is effective in the UK because it is used properly.

How to do it properly
The key for all direct marketing is get the customer information right in the first place and keep it updated accurately thereafter. Well targeted communications can improve response rates by 300%.

If you don’t have the resources to compile data, outsource. There are many firms offering data collection, cleansing and data suppression services and it is money well spent.

Next, take some time to think about what you are doing and why. Are you looking to make a sale or build a customer base? Free tip, it should be the latter. Once you know what you are doing and why, think about the channel.

Determine which is the right channel. Should you use email, magazine or newspaper inserts or other. If you have a lot to say or want to show off images, an email is probably not the right channel to use unless you have a very niche product and a very well researched database. Many firms simply programme their servers to reject any email with an attachment.

Measurement
Measurement is critical in any campaign but especially so in Direct Marketing. Understand what the exercise is going to cost so that you know what your break even point is. Also measure response rates from specific segments and determine why prospects don’t buy.

Personalise each communication
If you want to stand out from the competition and have a chance of connecting, every communication should be personalised to ensure a chance of engagement. Personalisation is dificult and time consuming because it requires attention to detail but worth the investment because it instantly makes the recipient feel recognised and important.

Content is king
Content is critical, especially if you are selling a luxury product. Yes I am aware that Malaysia is a price driven and discount defined market but I disagree that that is all it is. It has got to that stage because consumers have been let down by advertisers so often and for so long that they now focus on price and price alone.

But as many luxury retailers, developers and service providers will tell you, provide a high quality service and product and consumers suddenly seem less focused on price and more focused on the experience and the prestige.

So make your content interesting. The example below is from a property developer trying to get wealthy buyers to part with millions of dollars. I doubt they will be successful with this copy.

Make content interesting, it’s not rocket science!

There is an edict within Direct Marketing industry that says, “Right offer, right person, right time.” It isn’t complicated, it just means that to be successful, start up, SMEs and GLCs need to up their game.

Put an end to poorly thought out, badly designed, written and untargeted material and use quality direct marketing to build quality brands.

Direct Mail, Email and your brand


Direct Mail and Email marketing are critical components of any branding strategy for either a business to business or business to consumer brand. And it is a growing business. But the quality of Direct Mail and Email marketing in Malaysia and the mining and management of the databases used is horrendous.

If you own a company and you want to destroy any equity there may be in your brand, prepare a badly written product sheet on your desktop and when you are finished, don’t bother to spell check the document.

Print 50,000 copies and shove them in all the letterboxes of as many office or apartment complexes in the Klang Valley as you can. While you are sitting at home waiting for the phone to ring (assuming you included it on the flyer – and believe me, some don’t), your ‘DM campaign’ is being thrown in the rubbish bin by the lift, used as a place mat for lunch or simply thrown on the floor by the mail boxes. Hardly an inspiring ‘moment of truth’ first time experience for your brand and potential customer.

Another way to damage your brand is to send the wrong material to the wrong people. I have three kids, two under the age of 13. Yet this year they have both received two offers from credit card companies. These offers state that applicants must be at least 18 years of age.

A lot of firms are moving away from DM to save money on the printing of their flyers or brochures and looking at Email marketing. Although figures are unavailable for Malaysia, the Direct Marketing Association in the UK informs us that 90% of companies are now using email marketing.

There is no doubt that a well thought out and planned email campaign can be effective and profitable. But too many firms don’t do this and instead are simply adding to the seven trillion spam messages expected to be delivered to inboxes around the world in 2011.

I signed up with a local event organiser for information on forthcoming branding and marketing seminars that they organise in the region. Within a week my inbox was inundated with emails related to human resources, accounting, insurance, motivation and other topics I have nothing to do with and no interest in. These emails are trashed with the same irritation as the ones for Viagra, lottery wins and Nigerian banks.

Despite my repeated requests to be unsubscribed from their list, I continue to receive multiple emails. I cannot simply mark the email as ‘junk’ because they are using a Gmail account and this will send all mail from Gmail addresses to my trash. The name of the company is ingrained in my subconscious, but for all the wrong reasons and it is now a matter of principle that we will not sign up for any event organized by this firm.

I have received about 10 emails in the past month from an insurance company that recently spent RM13 million (US$4 million) on a rebranding exercise. The emails are not personalized, the attachment is of a flyer that is dull and states in two places that the offer is exclusively for Mastercard holders yet I don’t have a Mastercard.

I really lose faith in financial institutions and other companies when they make such mistakes. Think of the money wasted on the cost of the name, flyers, administration and so on.

The rewards for good campaigns are significant. The Direct Marketing Association reports that more than RM550 billion was spent on direct marketing advertising (including email marketing) in 2008 and sales generated from that were an astonishing RM6,450 billion! There is no question then that DM can be effective because it allows consumers to read about the products and services before deciding to explore further, or even buy.

But it has to be done properly. It is not enough simply to create a campaign and send it out. It is also important that the content resonates with the target market. And you still need to ‘sell’ the product. Just because you have got into the prospect’s inbox, doesn’t mean the prospect will buy.

The key for all direct marketing or email marketing is get the customer information right in the first place and keep it updated accurately thereafter. If you are collecting a lot of leads but don’t have the resources to input and clean the data, then outsource. There are many firms offering such services and it will be money well spent.

There is an edict within Direct Marketing industry that says, “Right offer, right person, right time.”

So it’s time for Malaysian firms, from SME up to main board, to end all this untargetted, uninspiring, untrackable, unproofed direct mail and start building brands with quality marketing collateral.