The Embattled Southwest Airlines Still Has Superfans and You Should Too!
Carol Feigenbaum |
 01/18/23 |
8 min read

The Embattled Southwest Airlines Still Has Superfans and You Should Too!

Will your business survive the next crisis? It’s an important question to ask given that 95% of companies expect to experience a crisis over the next two years. And it’s a position that Southwest Airlines finds itself in right now!

That stat is from a 2019 PwC study – before the pandemic hit and 100% of companies suffered. But for many businesses, especially those with upwards of 5,000 employees, crises are an annual occurrence. But research has revealed that although the majority of organizations have come to terms with the risk of a crisis, only about a fifth have set up strong crisis response strategies.

How Southwest’s Crisis Evolved

Southwest Airlines seems to be on the side of the majority. Over the Christmas period, the much-beloved brand dented its reputation with travelers when – due to an outdated scheduling system – it grounded all of its planes, leaving thousands stranded and missing their holidays.

The indication of the company’s unpreparedness comes from the slow pace with which it responded, as well as its failure to pacify the customers. While the leaders were lauded for their sincerity – acknowledging the problem, offering refunds, and awarding travel points – there was no assurance to the customers that the problem was fixed.

Despite the huge gap in its efforts, many customers expressed their loyalty to the brand via social media and in the news. It remains to be seen how this will affect the company in the long term.

For now, there is at least one lesson learned from the Southwest Airlines Christmas catastrophe. That being a loveable brand doesn’t protect you from a crisis, but having a loyal customer base goes a long way in mitigating the effects – and Southwest has them.

Why Brands Need Superfans

During a crisis, loyal customers show up to shield the brand in a way no other stakeholders can. They are the ones that will declare, “I am a huge fan” or “I have faith” or “I’m not going to let this one bad situation ruin [my relationship with the brand]” because they are not just customers, they are superfans.

Superfans are loyal customers who not only buy exclusively or usually from the brand but also actively promote and defend it. That sounds like a good spot for a brand to be in, but the effort required for creating such a community is extraordinary. Is it worth it? Let’s explore the benefits to see:

1. Lower marketing costs

Research shows that only a small fraction of first-time buyers come back. This means that most brands are spreading their marketing budgets across the entire customer journey because the majority of their customers are first-time buyers.

To achieve the set revenue goals, the only solution is to have a large marketing budget. Successful businesses focus the larger portion of their resources to making customers come back – which is up to 25 times less costly.

Loyal customers also lower the marketing budget when they recommend the brand to their friends and relatives, doing half the work it takes to move a consumer from brand awareness through purchase. In return, some brands offer a referral fee while others provide different perks.

2. Higher revenue

In part, this is a direct consequence of lower marketing costs. However, loyal customers also spend more per purchase than new ones. Research shows that the top 10% of a company’s customer base spends thrice as much per purchase as the remaining 90%.

Additionally, companies on average earn up to 65% of their revenue from existing customers. There is also higher potential revenue as companies have a 60 – 70% chance of selling to repeat than new customers.

It is much easier to introduce new products to existing customers. Thus, the company can create more revenue streams based on the loyalty to the brand.

3. Advocacy

Brand advocates are employees or customers who promote and defend the brand. This is important because people feel more connected with advocates than brands and therefore are prone to the influence of the former.

When asked, loyal customers will always have something to explain why they love the brand. Meaning, they have bought into at least one aspect of it. They can’t help but share it. In fact, 9 out of 10 customers are ready to give referrals of products they buy.

Loyal customers can also speak up for the brand during times of crises overwhelming detractors, enlightening doubters, and strengthening the faith in the company.

Building a super fanbase

Superfans are not born, they’re made. Think your brand targeted to a particular generation automatically earns it a place in their lives? Think again, market fitness is just one ingredient that goes into customer loyalty.

Much of it has to do with emotional connection. Speaking to The Washington Post, one superfan noted, “Clearly, Southwest Airlines can come back from this with many people if I’m any indication. I think what that shows is that it’s so important to have goodwill built up when a crisis hits.”

Superfans know their value to the brand and that brands vie for customer loyalty experienced by Southwest Airlines, Apple, Nike, and all those other brands that have super fanbases.

word cloud showing positive sentiment and posts

Customer loyalty largely comes from emotional connection.

Where does loyalty come from?

At least three quarters of consumers have tried new shopping habits over the last three years. For many, the new behavior involved abandoning their regular brands. A McKinsey study done during the pandemic cites store availability, convenience, and value as the main reasons for customers switching brands.

Before building a super fanbase, you have to know what drives loyalty with your target customers. One of the best and most common ways to do this is through great customer service. This touches all interactions the customer has with the brand throughout the purchasing process.

This results in a great customer experience and satisfaction. Brands that want to earn customer loyalty have to master the customer journey. Whether in-store or online, it should be easy to find what the customer is looking for including the products, information, and checkout.

The brand identity certainly has an influence on customer loyalty. It encompasses the vision, mission, and values. These reflect in the projects, employees, and customers the organization attracts. When they align with the customer’s ideals, a bond is formed. And it’s a bond that holds even when others are slamming an airline for an “unacceptable” “travel fiasco.”

word cloud showing negative sentiment

Customer loyalty can be influenced by external factors e.g. the internet, trends, pandemics, etc, so brands must acclimate to these conditions. This is why it’s important to understand changing customer behaviors and expectations through consumer and market intelligence.

Types of loyal customers

All loyal customers are not the same – there are tiers to customer loyalty. There are customers who are loyal because they are happy. They enjoy the service and have never had a reason to complain and so they keep coming back. However, you can’t count on them to stay if they get upset or a better deal.

Another type of loyal customer who will be swept away by a better deal is the price-loyal customer. They are attracted to the lower prices and they will keep coming back as long as you offer the best deal. With them, you know where the button is, but it can be costly to keep them amid changing market conditions.

If you have a great loyalty program, you might also have some customers who are loyal for that reason. They don’t scrutinize the product or care too much about other company details and will remain loyal to your amazing loyalty program.

Others are loyal because it is convenient. Online shopping was one of the top new behaviors exhibited by customers during the pandemic. People started buying from online shops because it was convenient for them and many continued after the pandemic. Others buy from sellers who are nearby for the same reason.

And then there are “loyal” customers that are drawn to the freebies such as free Wi-Fi, promotional products, meals, and information. This type of customer may only buy from you when there are such offers or when they need the freebies.

The main customer that you can really bank on is the superfan. Superfans may be described as the only truly loyal customer. They buy, promote, and defend your brand because they love it. Different factors contribute to their connection to the brand and so they are not easily swayed by isolated cases where one element fails. In the words of a Southwest Airlines customer, they keep their faith and trust that it is well placed.

Stages of customer loyalty

The stages of customer loyalty are really the various stops in the purchasing journey. The brand seeking to improve loyalty should view them in a new light, optimizing each stage to evoke loyalty.

customer-journey-consumer-intelligence

At the very beginning, the customer becomes aware of the brand including its offerings. To foster loyalty, brands tune their marketing to establish familiarity and credibility. First, through techniques such as repeated exposure, and then by inspiring confidence in their messaging.

The second step is researching where the customer wants to know more about the brand because they are considering the purchase. Brands set themselves apart by offering all the material that the potential buyer needs exactly where they’re looking for it. This requires understanding who your target audience is and where they spend their time online.

At the third stage, the customer completes a purchase. What matters here is how they experience the purchasing process. Brands improve this stage through better customer service, faster checkouts, secure payments, and quick deliveries, etc.

The customer becomes sure of their purchase when they use the product at the fourth stage. This is where they verify the claims of the seller about the quality of the product and either become satisfied or disappointed. Here, brands have one way out: Make great products. They also offer satisfaction guarantees.

If they are satisfied, the customer becomes a repeat customer. This is the first time the brand gets that signal back showing a potential loyal customer. To encourage it further, they collect feedback to know how they can improve and also make the customer feel valued. By far the most successful technique for many brands is a loyalty program.

The final stage of customer loyalty is when they recommend the brand to someone else. While this is based on the customer’s conviction, brands can still influence the stage by offering incentives for referring new customers.

The role of social listening

The majority of consumer conversations are happening online, especially on social media. With social media listening, brands have a whole new way of connecting with their customers and creating customer loyalty.

Social listening allows you to collect data on consumer conversations and analyze it to uncover hidden insights that you can use to optimize different stages of customer loyalty, identify different types of loyal customers, and discover untapped opportunities.

It’s closely associated with social media monitoring which collects data on an ongoing basis providing real-time updates on ongoing conversations. It can be very useful in addressing emerging issues before they escalate or simply responding to consumers on time.

Social listening and monitoring can be used to track mentions which is a great way to find potential and existing customers across the web. For instance, brand advocates can be easily found and rewarded whenever they mention the brand in social media posts, reviews, and forums.

And it helps you analyze consumer trends so you can understand and predict consumer behaviors and expectations. This is key to great customer experience and satisfaction and hence crucial to building a loyal customer base.

trend vs fad vs noise

Social listening is great for analyzing consumer trends.

When combined with NLP sentiment analysis, social listening helps you understand customer emotions and what drives their actions. This can help you tailor experiences at each stage of the customer loyalty journey.

If you want a battalion of superfans, you must have a brand identity reflected in your company culture. Brands that are out to make the world a better place have a high chance of connecting with their target customers through their ideals.

You must also excel in customer service as this is the most significant point of contact between the brand and the customer. The customer service experience often ends up overshadowing the entire customer experience, whether it’s positive or negative. Strategic partnerships with influencers, KOLs, and micro-influencers also helps. They have unmatched credibility and access to new audiences that you could use to foster customer loyalty.

Making use of advanced consumer and market intelligence technology makes everything else easier and more effective. NetBase Quid’s AI-based suite of tools – including social listening, social media monitoring, and sentiment analysis – will empower you to cultivate customer loyalty in ways you haven’t even imagined possible, and create a stock of superfans that will carry you through any crisis, even one that rises to the level of this current travel fiasco created by Southwest! Reach out for a demo to see how.

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