What Boeing has to do to attract terrified consumers

by Erik Sherman

Two years after a couple of fatal accidents, the Federal Aviation Administration finally cleared the Boeing 737 MAX to return to the skies.

That’s good news for Boeing’s business, but it’s unclear who will want the plane: Airlines are already facing tough times in a pandemic environment, and consumers may be scared of the MAX. Now Boeing has to find ways to regain confidence in difficult circumstances.

Drop in sales and deliveries

The 737 line had become the most popular commercial aircraft line for Boeing. That entire business category has been critical to the company, accounting for 60% of revenue, 66% of total operating profit and three-quarters of net profit in 2018, its last “normal” year.

The popularity of the narrow-body 737 boosted Boeing’s commercial sales and kept it in stiff competition with rival Airbus, until crashes in late 2018 and early 2019. With the FAA and other global regulators for MAX aircraft, orders of 737 fell precipitously.

Shipments also fell and Airbus prevailed. With Covid-19 cutting back on airline traffic, the disparity only increased.

The pandemic was a major problem that affected the sharp drop in deliveries, but not the only one. The 737 MAX was grounded. Boeing and the FAA came and went on the subject as more about the design and build of the MAX came to light.

Scare consumers

“It’s always a problem for companies when they have a major product failure, and there’s nothing more important than killing people,” said Jeffrey Inman, professor of marketing and business administration at the Joseph Graduate School of Business. M. Katz at the University of Pittsburgh and editor-in-chief of the Consumer Research Magazine. “The airlines are also trapped. They were hooked on billions of dollars worth of planes. I think airlines are doing the right thing by offering passengers the option to rebook on other planes free of charge. “

Boeing is not the first corporation to alienate the public. Chipotle had a E. coli breakup in 2015, BP lost confidence with its 2010 Gulf of Mexico oil spill, Sony had major hacking issues with the PlayStation Network in 2011, and with the posting of personal records and embarrassing emails in 2013. All are examples of massive errors and worst type of consumer reaction.

The first step in regaining a marketing position is often crisis communication. “The typical playbook is to go out in front of [the problem]They express their sympathy for the victims and promise to make the necessary changes, ”Inman said. “The principles are solid, I think. But you have to apply them consciously and not just follow the movements. “

“It’s a playbook, but only if you follow the rules and take the steps seriously,” said Steven D. Cohen, associate professor of business communication at the Johns Hopkins Carey School of Business. “I don’t think crisis communication is broken. I think companies are talking lip service. “

Beyond lip service

Companies must be willing to endure pain when they cause it. Ella Rauen-Prestes, chief executive of UK-based Fitbakes, which makes low-fat, high-protein sandwiches distributed through supermarket chains and department stores, faced upset customers over the summer.

Record temperatures in the UK led to a sharp increase in heat in customer warehouses. “Everything started to melt away,” Rauen-Prestes said. “It was a bit of a nightmare.” The stores either returned the products or charged the company for their disposal. Consumers complained on social media.

Fitbakes made a recall and also offered replacement shipments for customers who bought direct. “We literally took it on the chin,” Rauen-Prestes recalled. “The good thing was that the response from those people was fantastic.”

Fitbakes used transparency and authenticity in its actions and communications, although it may still have lost some consumers. “A customer who buys it and has to return it probably won’t buy it again,” Rauen-Prestes said.

Boeing has a much bigger hurdle to overcome: getting people to accept that a plane is safe.

Show confidence in safety

“Accountability is really important on the part of Boeing,” said Alina Gavrushenko, director of marketing and public relations for on-demand charter company Monarch Air. “It is important to understand that the company grew from this experience and has rectified any situation or problem that could result from these risks. They need to be able to show that it is a safe plane to fly. “

Showing confidence won’t happen by talking. “Proving a nullity is practically impossible,” Inman said.

In addition to increasing spending on R&D and safety, Boeing executives have to “put their money where their mouths are” to show the public how important the issue is to them, Cohen said.

One thing Boeing could do is organize a series of tours, take the plane to different cities, and offer public tours, explaining how it differs. And show company executives spending a significant amount of time on the 737 MAX.

“If they are willing to travel in their own plane, that would indicate that they consider it safe enough to risk their own lives,” Cohen said.

And “make sure the problem is really fixed,” says Inman. “If something else fails, people will attribute it to the problem not being fixed.”