Corporate Communication, Social Media

United Airlines PR Crisis Case Study

Presented By Group: 1

 Abhinandan Jain
 Altaaf Navith
 Harshit Bansal
 Nilesh Dutta
 Sweta Upadhyaya
 Udbhav Dwivedi

Presented To :

Ravi Vatrapu
Director, Center for Business Data Analytics (cbsBDA: bda.cbs.dk)
Professor, Department of Digitalization
Copenhagen Business School
Denmark
Crisis Management Final Report – United Airlines Fiasco Case Study

Preface
#BoycottUnitedAirlines – 7615 Tweets, 16032 Re-Tweets, 73236534 impressions on ’Flight
3411’. This social media data would certainly be of interest to analyse the United Airlines Public
Relation team's efficiency during the crisis. As the incident unravelled, passengers and public
used social media to express their thoughts on the incident. Social Media has become a powerful
tool because it is instant and viewed across the globe. This provides a platform for new ideas,
discussions, and more importantly brand marketing. As a result, United Airlines PR team had to
respond to the crisis and deal with communication challenges to protect the brand image from
disaster. Let us explore the strategies adopted by United Airlines, the drawbacks, language style
and what the ideal response should have been in Social Media.

There are a lot of uncertainties in the world. One minute the business might be running smooth,
and the next minute there can be a major crisis where operations come to a screeching halt. As
a business case, it’s crucial that an organization is prepared with a plan of action to handle an
emergency crisis. In this situation, Crisis management plays an important role and is defined as
“the application of strategies designed to help an organization deal with a sudden and significant
negative event.” So by expecting the unexpected, a company managing a crisis professionally
and efficiently can minimise the negative impact, that a crisis like this can potentially have.

Case Company
United Airlines commonly referred to as United, is a major United States airline headquartered
in Chicago, Illinois. It is the fourth largest aviation corporation in the US market. It is also the
largest in terms of the number of destinations served, operating approximately 4,500 flights a
day to 337 airports across five continents. Four airlines represent over 80% of domestic capacity:
American, United, Delta, and Southwest, where the latter is a ‘low cost’ carrier (Eyefortravel
Reporter 2017). Currently United Airlines is headed by CEO Oscar Munoz, who was made United
Airline's CEO on Sept 8, 2015.

United Airlines revenue adds up to US$37.736 billion, making it world's third largest airline
when measured by revenue after American Airlines and Delta Airlines. According to United
Airlines, it operated more than 1.6 million flights in 2016, carrying over 143 million customers.
Furthermore, United “is a founding member of Star Alliance, which provides service to 190
countries via 28-member airlines”.

On Twitter, United Airlines have posted 873,000 tweets and has 963,000 followers. On
Facebook, the numbers of followers are 1,094,322, and the page has a total of 1,120,463 likes.

At present United airlines has a market capitalization of $19.43 billion. On 11th April 2017,
United Airline's share prices fell by 1.1% , wiping out $255 million off of its market capitalization
leaving it with a market cap of around $22.5 billion.

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Crisis Management Final Report – United Airlines Fiasco Case Study

Unfolding of the crisis

Situation, On 9th April 2017, United Airlines called for four volunteers to give up their seats due
to overbooking. The overbooking was caused, as four cabin crew members had to be assigned
seats on the flight, because their initial flight experienced maintenance issues. Members were
scheduled to operate another flight, the following Monday morning, which was why they could
not be late, and wait for another plane to board. If they did not arrive at their destination on
time, “there was the prospect of disrupting more than 100 UA customers by cancelling at least
one flight on Monday and likely more” (United Airlines 2017b). With this in mind, United found
it necessary to identify four customers who would have to be removed.

As no one volunteered to give up their seat, United Airlines was forced to follow procedure and
instead let the computer randomly select four passengers to disembark the aeroplane. Four
passengers were selected and told to leave, but one of them refused. This passenger, who was
later identified as David Dao and was a doctor from China, refused to leave the aeroplane and
United Airlines had to call in security to remove him – another standard procedure according to
United Airlines itself.

The first video of the incident was uploaded on Twitter at 7.30 p.m. EST the same day the
incident happened. On Facebook the video was viewed 19 million times before it was removed
from the platform. On both platforms the video was shared and commented on by millions of
people and went viral over a very short time.

Apologies, Late at night on the day of the incident United Airlines’ first official statement
about the incident was sent to Louisville Courier-Journal (Ohlheiser 2017), but it did not state
any apology for what had happened- ” Flight 3411 from Chicago to Louisville was
overbooked. After our team looked for volunteers, one customer refused to leave the
aircraft voluntarily and law enforcement was asked to come to the gate. We apologize for
the overbook situation. Further details on the removed customer should be directed to
authorities.”

On Monday, 10th April, United Airline’s chief executive Oscar Munoz issued a statement on
the airline’s website, as well as on its social media platforms such as Twitter and Facebook.
This statement was not taken as an apology, but instead a poor excuse for what happened on
the plane. Munoz referred to the incident as a “re-accommodate”, which stirred up public
outrage and led to calls to boycott the airline. This can be seen in the many comments on the
UA statements posted to Facebook and Twitter. -"This is an upsetting event to all of us here
at United. I apologize for having to re-accommodate these customers. Our team is moving
with a sense of urgency to work with the authorities and conduct our own detailed review of
what happened. We are also reaching out to this passenger to talk directly to him and
further address and resolve this situation.”

Another statement was sent out as a letter to the company’s employees, which was later
shown to the public. This letter received a great deal of negative attention, as people claimed
that Munoz implicitly blamed the victim in the letter by calling him “disrupted and
belligerent”.

Overnight, the incident became a top trending topic in China and concerns that Dr Dao was being
targeted because he was Asian went viral.

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 Crisis Management Final Report – United Airlines Fiasco Case Study

Main Actors of the PR Crisis

Actors Designation Role
Oscar Munez CEO United Airlines public Representative
David Dao Passenger Main Victim
Flight Attendants United Airlines Staff Crisis Initiators
Security Personals Airport Authority Staff The Oppressors
Twitter, Facebook Social Media Influencers, Medium of communication

Factors of the situation Crisis

Sunday, April 9 2017: Travellers scheduled for United Express Flight 3411
begin security check at O'Hare International Airport for a 5:40 PM. flight to Louisville.

During the boarding process: Flight 3411 had been overbooked. Flight attendants
seek volunteers to give up their seats to accommodate 4 United Airline employees.

The company offers to volunteers: A $400 voucher later increased to 800$,

A hotel stay in Chicago and a seat flight after 21 hours.

A manager boarded and informed the flight that 4 people would be chosen
by computer selection based on specific factors.

3 of the selected passengers agreed to leave. The 4th selected passenger,

69-year-old refused. United Airlines staff called Aviation security officers.

Victim refused to leave, and in the ensuing scuffle with security official ,
he suffered injuries apparently conscious. All this was on social media
affecting United Airlines.

Aftermath of the Event

What went wrong?

• Low Compensation offered by United Airlines. (standard compensation is

$1300)
• No comment on why the passenger was forcibly removed from the flight.
• No response for the Chinese anger at violent removal of passenger
• Wrong process followed in handling the situation.
• Muted Response from CEO, Oscar Munoz.
• PR Crisis due to delayed apology from the management.

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Crisis Management Final Report – United Airlines Fiasco Case Study

Main Stream Media Coverage

Washington Post - United CEO says he felt ‘shame’ watching video of man dragged from
flight and accepts responsibility
https://www.washingtonpost.com/local/trafficandcommuting/united-ceo-says-he-felt-shame-
watching-video-of-man-dragged-from-flight-and-accepts-responsibility/2017/04/12/a00d1e1e-
1fae-11e7-ad74-3a742a6e93a7_story.html?utm_term=.657cb30b6261

Washington Post - The full timeline of how social media turned United into the biggest
story in the country - https://www.washingtonpost.com/news/the-intersect/wp/2017/04/11/the-
full-timeline-of-how-social-media-turned-united-into-the-biggest-story-in-the-
country/?utm_term=.5a375ec50f0a

BBC - United Airlines mocked online after passenger's removal

- http://www.bbc.com/news/blogs-trending-39564114

Al Jazeera - United Airlines apologises for removal of passenger

https://www.aljazeera.com/news/2017/04/united-ceo-apologises-passenger-removed-
170412012733328.html

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Crisis Management Final Report – United Airlines Fiasco Case Study

Reuters - United Airlines under fire after passenger dragged from plane; officer put
on leave - https://www.reuters.com/article/ual-passenger/update-5-united-airlines-under-fire-
after-passenger-dragged-from-plane-officer-put-on-leave-idUSL1N1HI0YU

New York Times - United Airlines Passenger Is Dragged From an Overbooked Flight
- https://www.nytimes.com/2017/04/10/business/united-flight-passenger-dragged.html

PR Crisis Management
Phase 1 – April 10th 2017

Situation Analysis

Social Media
Positive Neutral Negative
0.1 0.1 0.9

Coomb’s Situational Crisis Communication Theory

Primary – Excusing

Secondary – Apology

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Crisis Management Final Report – United Airlines Fiasco Case Study

As the communication is reflective of an understanding of the crisis situation that differs wildly
from consumers’ understanding of the same, it is not surprising that the first statement is not
an example of successful and effective crisis communication; the goal of which must be to
mitigate a crisis. A communication crisis happened because UA was unable to handle the
original crisis to the satisfaction of consumers.

Phase 2 – April 11th 2017

Situation Analysis

Social Media
Positive Neutral Negative
0.1 0.2 0.8

Coomb’s Situational Crisis Communication Theory

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Crisis Management Final Report – United Airlines Fiasco Case Study

Primary – Apology

In terms of establishing the crisis type, we think that UA has changed the view on how they
understand their crisis situation. They are now operating within the preventable cluster.

Phase 3 – April 27th 2017

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Crisis Management Final Report – United Airlines Fiasco Case Study

Situation Analysis

Coomb’s Situational Crisis Communication Theory

Primary – Apology

Though positive consumers were stepping forward, we still see much criticism for United
Airlines. It may have been inspired by consumers in the comment sections of the first two
statements, as they in the last three statements repeat the phrase “actions speak louder than
words”. This sentiment was variously expressed by consumers who asserted the sincerity
behind actions, rather than words. This backfired a little with new communication criticism
that found UA’s actions plenty loud.

Overall, despite managing to have many consumers express their positivity towards UA’s
efforts or the company itself, UA’s statements were still received mostly negatively by
consumers.

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Crisis Management Final Report – United Airlines Fiasco Case Study

Short Term effects

 Stock Market

Shares of United Continental Holdings (UAL), the parent of United Airlines, closed at
$70.88 on April 7. On April 10, the first trading day after the incident, they rose by 0.9%
to close at $71.52. Although UAL shares declined by 1.1% on April 11, they closed at
$70.71, only $0.17 or 0.2% less than the April 7 closing price.

 Social media

The victim was initially thought to be Chinese American as one of the witnesses told The
Washington Post, "He said, more or less, 'I'm being selected because I'm Chinese.'" The
incident thus drew outrage on mainland Chinese and Vietnamese social media and became
the number one trending topic on the Chinese micro-blogging site Weibo, attracting the
attention of more than 480 million users.

The incident also outraged Yelp users and low star rating were given to United Airlines in
Chicago and other cities including San Francisco.

An article in Foreign Policy noted the racial and political reasons for the wide spread of the
video throughout the mainland Chinese media sphere, where there are heated debates over
the nature of America's political system and its relations to China, and asserted that the
video would serve the ends of the authorities and critics of America in challenging America's
cultural sway in China.

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Crisis Management Final Report – United Airlines Fiasco Case Study

Ire in Vietnam grew after it was reported Dao's origins in that country. There was also
negative reaction to allegations over Dao's past being reported in the United States, which
was viewed as irrelevant and possibly racist.

The incident had taken place shortly after another controversy in which United refused
boarding to two teenage girls wearing leggings. There were calls by social media users
across the world, especially those in the United States, China, and Vietnam, to #boycott
United Airlines. Customers of the airline posted pictures of their United loyalty or credit
cards cut into pieces. Another petition called on the U.S. federal government to launch an
investigation into the incident, invoking the Black Lives Matter movement by using the
hashtag "#ChineseLivesMatters".

 Consumer preference

A poll of 1,900 people conducted three days after the incident suggested that all else being
equal, 79% of prospective fliers who had heard of the incident would choose a non-United
Airlines flight. 44% would choose a non-United Airlines flight even if it cost USD$66 more
and took an additional three hours.

Despite calls for a boycott, United Airlines reported 39% greater profits over the previous
year in the second quarter of 2017, as well as increased sales. Economist John Kwoka Jr.
attributed this to the high level of consolidation of American airlines, with a majority of
flights controlled by four corporations—United, Delta, American and Southwest—making a
boycott impractical. Additionally, for many travellers, ticket price is the primary deciding
factor when booking flights, outweighing other considerations such as customer service.

 Industry Behaviour

In August 2017, data from the U.S. Department of Transportation showed that bumped-
passenger rates were at their lowest since 1995. The rate "markedly decreased" starting in
April 2017 (the same month this incident occurred) from 0.62 per 10,000 passengers, to
0.44 per 10,000 in the second quarter of 2017.

Long-term effect of the crisis

We all know that silence is not golden when a crisis starts brewing for a brand because it gives
the issue a chance to percolate and ultimately boil over as the news travels online, usually at
the speed of light. The longer the delay, the more widespread the damage typically, and the
longer it takes to reel the situation in and restore normalcy. There is a strong relationship
between how and when companies respond to public relations crises and their ability to
maintain a solid brand reputation in the long term. United Airlines that wait to respond to
negative PR crises are more likely to lose customers.
United Airlines waited several weeks to respond to a video of an airline official forcibly
removing a passenger from a flight. Consumers’ willingness to purchase flights from United
Airlines dropped from 68 percent before the PR crisis to 42 percent immediately after. Seven
months after the crisis, 30 percent of consumers say they will not buy flights from United
because they lost a sense of trust and safety in the brand.

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Crisis Management Final Report – United Airlines Fiasco Case Study

United Airlines has not fully redeemed its reputation because their PR response rate was slow
and the company’s apology was considered insincere by consumers. People will still continue
to fly with the airline due to the limited competition in the US airline industry. In the end,
brand reputation is incredibly important for a company’s ability to succeed. To build long-term
brand reputation, short-term PR strategies must be ready to be implemented at all times.

Social Media Reactions

After the crisis unfolded many other airline companies and many social influencers jumped on
the bandwagon and used the fiasco as a platform to market their product and improve their
social presence.

Emirates made a video to celebrate its being awarded Best Airline in the World status in
Monday’s TripAdvisor awards, and concluded the video using the line “Fly the friendly skies…
this time for real.” Which of course is the United’s infamous slogan.

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Even Comedians such as Jimmy Kimmel and Conan O’ Brien mocked United Airlines in their
respective Tv Shows.

7s framework for the organization

 Strategy - UA should become more customer oriented. They should avoid putting
customers, employees and partners into impossible situations which they can't control.
Reduce amount of overbooking.
 Structure-During any emergency situation the hierarchical structure should be followed
in order to better deal with the situations.
 Systems- They should have an automated system for soliciting volunteers to change
travel plans. Passenger shouldn’t be asked to de-board once he has boarded the flight.
 Shared Value- Change culture to be service oriented by taking every employee through
customer service training program.
 Skills- Staff should be trained to be compassionate towards passengers and special
training need to be given for emergency crisis.
 Staff- Staff need to be responsible and accountable.
 Style-Need to change their style from profit oriented to service oriented.

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Conclusion
United Airlines’ crisis communication regarding the ‘Flight 3411’ incident changed over time.

The first statement resulted in a double crisis for United Airlines, as it failed to address the
concerns of consumers and rather communicated the wrong thing at what could have been
the right time. Consumers expressed their heated condemnation of both the company, the
incident and the company’s handling of the incident, and flooded the first comment sections
with 173,000 comments, of which a very convincing 98 percent were negative. The dominant
themes of ‘boycotting’, ‘communication critique’ and ‘humanity’ reflected how commenters
perceived and evaluated the incident

It seemed that United Airlines had been listening to their consumers on social media.
United Airlines then released a new, apologizing profusely several times, and explicitly accepts
responsibility for the incident. This constitutes a very noticeable change in United Airlines’
crisis communication efforts. However, the drastic about-face expressed in the new statement
still did not appease consumers, and rather resulted in consumers questioning the sincerity of
the new statement, as seen in the negative responses.

As such, we conclude that United Airlines communicated the right at the wrong time,
effectively reversing the rhetorical failure of the first statement, in which the time was right,
but the content was wrong.

At a total of 55,000 comments, interest for the incident and United Airlines’ responses seemed
to have declined by more than two-thirds.

We argue that the development of United Airlines’ crisis communication over time shows signs
of having been influenced by consumers’ comments. Consumers exerted power and influence
over United Airlines by harnessing the power of social media. Conversely, United Airlines
found itself unable to successfully influence consumers in turn, so as to mitigate the backlash
of the crisis. We conclude that modern consumers may have been able to force the company
to quickly adjust its crisis communication strategies through their exerting of influence through
voice on social media.

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