Magazine article Marketing

Opinion: The Marketing Society Forum - Can Discounting Serve to Win Back Consumer Trust after a Crisis?

Magazine article Marketing

Opinion: The Marketing Society Forum - Can Discounting Serve to Win Back Consumer Trust after a Crisis?

Article excerpt

Australian airline Qantas has offered free travel to the tens of thousands of passengers affected by its recent industrial dispute, which grounded its entire fleet and hundreds of flights in 22 countries.

YES - ALISON HOAD, VICE-CHAIRMAN, RKCR/Y&R

There may be no such thing as a free lunch but there most certainly is such a thing as a free flight. Moreover, people feel curiously proud when they secure them for themselves or, even better, for others, such as friends and family. You have only to look at the extraordinary loyalty that the Air Miles programme engenders to see how highly people value free flights (and, of course, other privileges).

In the case of Qantas, I think this will definitely work to entice people back. We all mess up sometimes, companies included, and apologising and accepting responsibility for one's failings often diffuses the anger of the situation. Apologising and offering free flights as an act of contrition is humbling and, as a punter, I like Qantas all the more for it.

I only wish British Airways had done the same two years ago when it grounded my flights, or that BlackBerry could have 'discounted' to win back some trust when the network went dark for two days last month. It would have made me feel more valued as a customer if they had.

YES - SUSAN AUBREY-COUND, DIRECTOR NEW CHANNELS, MARKS & SPENCER

Discounting on its own is unlikely to be enough to win back trust in a crisis. However, where a strong brand has 'the benefit of the doubt' and a discount is positioned as part of a sincere apology, it can encourage retrial and effectively drive viral communication.

We did this with our 'We've boobed' campaign in May 2009, a very public U-turn tackling the perception of an unfair pricing differential on DD-G bra sizes when public trust in business was at an all-time low, due to the banking crisis. While our pounds 2 premium was longstanding, logical and 'fair' (the bras do cost more to make), we had been slow to respond to online opinion when this was challenged on an emotional level.

The apology and price repositioning was supported by a 25% discount for two weeks, and the resulting uplift was more than 30% in-store and 160% online. However, the parallel objective was the U-turn in customer sentiment and trust expressed and, importantly, it sustained sales long-term. Discounting can work in a crisis, but it needs to be relevant, proportionate and part of a rounded and sincere response.

YES - ANDY CORCORAN, HEAD, IDEATION

Consumers want the companies they buy from to be honest and transparent Such is the range of options open to consumers that the days when brands could mess up and yet be confident that their product would still sell are gone. …

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