The Internet of Things - Part 1 - Brand Equity Update

Welcome to Dove Direct's Marketing Collateral Blog. Today's Post The Internet of Things - Part 1 - "Brand Equity Update" is an update focusing on retaining brand equity in the age of heightened social media participation. As we welcomed 2019, The Internet of Things (IoT) had dramatically altered the customer experience which points to an omnipresence level of engagement that replaces one-way customer communications. In addition, this updated post demonstrates the differences two major airlines implemented in responding to customer incidents, that being United Airlines (2015) and Cathay Pacific Airlines (2019).

When Google launched in 1994, the journey of a robust internet began. About 10 years later, sometime around the mid-2000s, IoT emerged to reshape global communications. In fact, the surge in Internet-connected devices, driven mostly by computer and mobile phone sales, changed the landscape in that for the first time, a trend was established whose growth rate eclipsed that of the global population. As 2008 rolled around, accompanied by the Great Recession of 2008, notwithstanding the global economic woes, the planet had become laden with more Internet-enabled devices than the global population. Hence, the IoT had been catapulted to the front of the communications line.

In 2019, the IoT trend has grown at an exponential rate, and has extended its reach well beyond PC's and mobile devices. The next wave of the IoT trend has extended to cars, thermostats, appliances, travel, medical diagnostic devices and sports equipment. In fact, by 2020, Gartner forecasts the planet will be home to IoT 2.0, connected by 26 billion+ non-PC and mobile devices. By the time this blog is less than a month old, the prediction will probably double. In addition, the 5G network is set to be introduced as of this updated post, including the promise that communications will be much faster and will incorporate new paths between digital devices.

Brand Equity In the Age of IoT

As we stated in our original post, brand equity is primarily based on the reputation of a company's brand performance established by consumers in the marketplace. For brevity's sake, we will not drill down to brand equity definitions or the fundamentals of brand equity building. Instead, the focus of this updated post will be to compare two travel industry providers on how to best handle brand equity retention in the age of IoT 2019.

Whether a brand is being launched or a brand has built equity over the years, with the intrusion of IoT, brands are now subjected to ultra fast, nano-second scrutiny by consumers, critics and prospects. This is the age of the consumer and consequently, regardless of a company's brand and marketing strategies, those strategic messages should be able to withstand scrutiny and offer competitive growth among consumers and critics alike. In short, brand equity building and maintenance is now a two-way street, in that communication flows between the brand and the consumer in real time. Ignore this reality at your own peril!

Brand Equity Communications - United Airlines

An example of real time communications and the result of the brand's equity position we share the story of United Airlines traveler Dave Carroll.

You may remember in 2015, that the singer/songwriter named Dave Carroll had a $3,500 guitar destroyed during a flight on United Airlines from Nova Scotia to Nebraska. After repeated attempts to reconcile with United Airlines, Mr. Carroll decided to take another approach. He created a YouTube music video based on a song called "United Breaks Guitars." As of this blog entry, Mr. Carroll's video has had 10,772,839 views. You can read the entire story on Sentium.com.

What effect do you think this had on United Airline's brand equity? Do you think that their inability or unwillingness to solve this customer's issue was worth the negative impact it had on the airline's brand equity?

According to Sentium, "This tsunami of bad public relations has certainly had an effect on people's decision in choosing an airline. The BBC reported that United's stock price dropped by 10% within three to four weeks of the release of the video – a decrease in valuation of $180 million. United is clearly the loser." That is why it is imperative to develop a communication monitoring plan that will serve the real world which is tied to the IoT.

If United Airlines had a grasp of the IoT during the Dave Carroll event, not only would they have been able to respond in a timely fashion, who knows, they may have even been able to develop a new policy for handling musical equipment, paid for a new guitar for Dave, and at the end of the day more than likely would not have been on the hook for a $180 million valuation loss.

Brand Equity Communications - Cathay Pacific Airlines

Hong Kong-based airline Cathay Pacific inadvertently sold first and business class flights at a massive discount earlier this month. The airline opted to resolve the situation by honoring the deal. Cathay Pacific mistakenly sold top-class seats on round-trip flights connecting Vietnam and New York for $675, the price of an economy seat. These first class seats are actually listed at $16,000. Conversely, the airline chose to make lemonade out of sour lemons and decided to honor the deal for customers who purchased these greatly reduced priced tickets.

In addition, Cathay Pacific used the pricing anomaly to gain marketing and brand equity advantages with consumers by labeling the pricing mistake a 'surprise special' for 2019, and even went so far as to incorporate the hashtags #lessonlearnt and #promisemadepromisekept into the marketing strategy.

The Net-Net

All brands can take a lesson from Cathay Pacific from a number of angles. For one, by taking advantage of a marketing misstep, brands can emerge from these types of situations as heroes, i.e., brands that care. Secondly, brand equity takes time to build and can be lost in a single erroneous marketing act (United Airlines Guitar), depending on how and when the situation is resolved. Lastly, brands that have the capacity to solve unforeseen errors on the spot will garner more customer support and loyalty, as today's customers are living and working in real time.

Let's have a conversation about brand equity and unified marketing collateral during our next Open House. You can join us on Thursday, January 31st, 2019, from 9:30 am to 4:30 pm. Let us show you how to improve your document processes to optimize your workflow, reduce your costs, and maximize your organization's printing, letter shop and mailing capabilities. And, if you bring us your files, we will create a demo file for you. For more information call Carla Eubanks at 404-629-0122 or email Carla at This email address is being protected from spambots. You need JavaScript enabled to view it..

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