Home | MIT Sloan Fellows | Leadership Blog

What companies can learn from United Airlines—and from trust-based marketing

How does a company build and keep consumer trust—and more important, win it back when that trust has been compromised? Thanks to viral video, the world has seen United Airlines “involuntarily deboard” a passenger, to use the airline’s term, and drag that passenger kicking and screaming from a legitimately purchased airline seat. The result? In the days following the incident, customers cut up United credit cards, shares in United Airlines stock slipped by 4%, and the company’s market value plummeted by $1 billion.

How can a company like United that has lost consumer trust gain it back? MIT Sloan Professor John Hauser says that it’s not enough to tell consumers that they can and should trust a company. “It’s critical to actually prove, again and again, that a company and its products can indeed be trusted – and customers must be provided with tangible, observable proof that a company has changed its ways.”

Four years ago, Hauser, MIT Sloan professor and former dean Glen Urban, and Gui Liberali of the Erasmus School of Economics in Rotterdam published a study on trust-based marketing called “Competitive information, trust, brand consideration and sales: Two field experiments.” The team tracked four marketing strategies by an American automaker with an ailing brand. The company had suffered from decades of negative publicity over the quality of its products and was working on several fronts to correct public perceptions.

Try our competitor on for size

The company believed that its vehicles were much better than customers perceived them to be and that they would win in a fair comparison. They set out to enable customers to see for themselves. In one experiment, the automaker gave potential customers the chance to test drive competitor’s cars so that they might compare them—favorably, they hoped—with the company’s own offerings. They also provided an unbiased online recommendation system to help customers choose the car that best met their needs—even if the make they chose belonged to another company. In addition, they set up a moderated discussion board that gave customers the chance to swap perspectives about the cars they were considering.

The program was such a success that the company has continued to provide competitive information to customers and encourages customers to test drive cars for longer periods. Dealers sometimes even rent rival company vehicles to hold targeted competitive test drives for selected customers.

Hauser underlines the moral of the story—that it’s one thing for a company to promise trust and another to become trustworthy. “The only sure way of getting to that trustworthiness stage is to make genuine internal changes and then to get customers back into dealership showrooms, in the automaker’s case, or into Wells Fargo bank branches, or on to United airplanes. That’s the only way consumers can determine for themselves whether a company and its products are again trustworthy.”

Read more about this study on the MIT Sloan Experts site.

Comments are closed.