United Airlines Boeing 737

Question: when is the PR man of the year also a PR disaster? Answer: when he is called Oscar Munoz, CEO of United Airlines. A month ago, he was being feted as the PR Week Communicator of the year, now he is held up as an example of what bad PR is. But did United Airlines really mess up their PR, or did they just get pricing wrong?

The answer to the question comes in two parts. Yes, they did suffer a PR disaster. But they also got their pricing wrong – not the pricing of the tickets, but the offer they made to passengers as they boarded United Express Flight 3411 was simply inadequate.

First. Take the PR.

The date is March 16th 2017. PR Week announces the winners of its prestigious communicator of the year award. And it’s Oscar Munoz. The magazine’s editorial said of the winner: “Munoz has shown himself to be a smart, dedicated, and excellent leader who understands the value of communications. His ability to connect and share with employees his vision for the airline, and get them to rally behind it, is a key reason PRWeek named him 2017 Communicator of the Year.”

Less than a month later, Dr David Dao was ‘bumped’ from a United Airlines aircraft.

Oscar Munoz’s first response was to describe Mr Dao as “disruptive and belligerent,” and talked about the airline following established procedure.

Then followed a tweet.

“This is an upsetting event to all of us here at United. I apologise 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."

That was better, but even so, it was missing the point.

Contrast this with a statement issued by the Chicago Department of Aviation, who were involved in the removal of Mr Dao:

“The incident on United Flight 3411 was not in accordance with our standard operating procedure and the actions of the aviation security officer are obviously not condoned. That officer has been placed on leave effective today pending a thorough review of the situation."

Now that really was a good response.

Finally, after seeing the United Airlines share price drop precipitously Mr Munoz said:

“No one should ever be mistreated this way.”

Well, he is right there. No one should. But why did it take a fall in the share price to elicit such words?

Even President Trump’s press secretary, a man used to trying to explain ill-conceived tweets, got in on the act. Sean Spicer said:

I don’t think anyone looks at that video and isn’t a little disturbed that another human being is treated that way. Clearly watching another human being dragged down an aisle, watching blood come from their face after hitting an armrest or whatever, I don’t think there’s a circumstance that you can’t sit back and say this probably could have been handled a little bit better, when you’re talking about another human being.”

Thankfully, Mr Spicer didn’t add, ‘that not even Hitler treated passengers like that.’

Okay, this was, to use the technical term, a screw-up.

Now the media is focusing on our rights should we get bumped from a plane. It turns out that an airline must ask for volunteers, and to incentivise passengers to acquiesce may offer compensations, they must provide the passenger to be bumped with a written statement outlining their rights, they must re-book the passenger on a flight, and pay additional compensation beyond that agreed in the first place. The passenger has the right to ask for any compensation offer to be in the form of cash, and not just flight vouchers.

But let’s return to that initial inducement to volunteers to forgo their seats on the United Airlines flight. As passengers bordered the flight, they were offered a $400 voucher, and an overnight stay in a Chicago hotel. This offer was then increased to $800.

It seems the big mistake was not to find a market clearing price. Price is determined by demand and supply, or so says economic theory. United Airlines offer a proposition to passengers which was simply inadequate.

It was a PR screw up, but it was an economic one too.

Still, at least we now know what to do in order reduce the odds of being bumped. Sign-up to an airlines loyalty programme, they are less likely to bump you, if that happens, apparently.

But here is a warning. In the US, if you are deemed an ‘unruly passenger’ you can be fined up to $25,000. Also, if you are bumped because the airline had to switch to a smaller aircraft or if there is a weight and balance issue, your rights are significantly less.

In the EU, if you are bumped, either voluntarily or not, your airline must offer you an alternative flight, at a date of your choice. And if you don’t want fly at all, you are entitled to a refund.