| Published: | November 29, 2010 |
| Author: | Julia Hanna |
Executive Summary:
A new case coauthored by HBS marketing professor John Deighton and research associate Leora Kornfeld offers an object lesson in the dangers social media can bring for big, recognizable companies and their brands. From the HBS Alumni Bulletin. Key concepts include:- The case documents the incredible viral power of social media, where one person can get the attention of a multibillion-dollar corporation like United Airlines and its customers with a music video produced for $150.
- One of the points debated in class is whether social media are better at destroying value than creating it.
- Students did not agree on whether United should have used the incident to make an affirmative statement on customer service, or should simply have kept a low profile and waited for attention to subside.
- Organizations need to be aware of how best to present itself in this new environment and respond to potential parodies of its brand.
About Faculty in this Article:
"United Breaks Guitars" documents the incredible viral power of social media, analyzing the reach and impact of a clever customer complaint music video produced by Canadian musician Dave Carroll when his attempts to recoup the value of his guitar (broken in transit) are stonewalled for over a year by United Airlines. Posted on YouTube on July 6, 2009, the video was tweeted by Carroll's friends, posted on social news sites, shared with Facebook friends, and picked up by bloggers. From there it was a quick hop to the mainstream media; by the end of July, the video had been viewed 4.6 million times, with external references expanding that audience by many more millions.
Taught in the MBA second-year course Digital Marketing Strategy and multiple Executive Education programs, the case depicts a new media era in which increasing numbers of people are spending as much time online as they are in front of the television and where one person can get the attention of a multibillion-dollar corporation and its customers with a music video produced for $150.
"This is a good case for getting a glimpse into a new world of communication, vs. the old world of Super Bowl ads and prime-time audiences," says Deighton. "The new world doesn't necessarily play by the rules of the old. One of the points we debate in class is whether social media are better at destroying value than creating it. In social media an entity's size and brand recognition make it more vulnerable to parody and attack, not safer. As we accumulate experience with these media, perhaps we will find that they tend to favor the insurgent over the incumbent."
United maintains a presence on Twitter and picked up a tweet about the video less than a day after it was posted. "This has struck a chord w/us and we've contacted him directly to make it right," United tweeted on July 7. It offered $1,200 to replace the guitar and $1,200 in flight vouchers; when Carroll asked that his compensation be given to another, similarly affected customer, United chose instead to donate $3,000 to a music school. Throughout the fracas, United used Twitter as its communication channel, answering critical tweets that it should have responded sooner with "Absolutely right, and 4 that (among other things), we are v.sorry and are making it right. Plan 2 use video in training."
Classes tended to divide sharply on whether United's response was very good or could have been better. The speed and consistency of the company's response won praise. But students did not agree on whether United should have used the incident to make an affirmative statement on customer service, or should simply have kept a low profile and waited for attention to subside.
As powerful as these viral incidents may be, Deighton suggests that the moment can fade fairly quickly. Even so, an organization needs to be aware of how best to present itself in this new environment and respond to potential parodies of its brand.
"It's a transparent world," he says. "This is an environment in which you simply have to be what you say you are. You can't hope to project an idealized version of the truth."
The old rules of marketing and advertising still apply, too: "The genius is not in the choice of medium: in the simple idea of using social media to fight social media," remarks Deighton. "It's in the quality of the idea." When all is said and done, "United Breaks Guitars" is a funny video with a catchy tune (in fact, Carroll credits it with "breaking" his music career). Sounds a lot like an old-fashioned television commercial, doesn't it?
Source:hbs.edu
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