3 November 2011

The Stumbling Kangaroo

(Image source: news.com.au)
There’s been much speculation in recent days about whether the recent industrial action by Qantas will have any lasting and damaging consequences for the airline’s brand.

The short answer is no, particularly in relation to the long run. Certainly in the short-term there could well be some angry customers who will divert their patronage to Virgin, but cool heads will eventually prevail and the way in which Australian travelers make their decisions in relation to travel will return to normal. When the dust settles, Qantas will again be evaluated according to whether it provides the type of services that the paying public is looking for.

Research suggests that well-established brands with long track records recover pretty well from marketplace failures. We only have to look at companies like Toyota, Coco-Cola and Vegemite for examples of brands that have bounced back strongly from highly-publicised setbacks. In the case of Qantas, we also can’t underestimate the power of the brand’s national icon status (as well as limited competition from other airlines) as additional buffers against lasting damage. Just how long the current backlash will last is difficult to say, but I think we’re only looking at a period of months, and certainly not years.

So just why are consumers so willing to forgive? It gets back to the notion of not cutting off your nose to spite your face. People had sound reasons for choosing Qantas before last weekend’s industrial action and those reasons remain unchanged. When the current tide of anger abates, as all anger does, they will realise they have little option. Indeed, when it comes to the question of what they’re looking for in airline travel, nothing will have fundamentally altered. Qantas will still offer the right fares, the right routes, at the right time. Consumers will go back to the way they used to make decisions and fly Qantas again. To not do so will hurt them.

Author: Charles Areni - Professor of Marketing - The University of Sydney Business School

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