From America’s Most Loved Airline to a Major Meltdown: What Went Wrong with Southwest Airlines
Southwest Airlines' Christmas 2022 fiasco led to thousands of canceled flights, negative sentiment, and an $800M revenue loss. Discover the narratives behind the issue.
If Christmas 2022 will be remembered for one thing in the U.S., it will most likely be the thousands of canceled flights that left family members across the country stranded just in time for the holidays. As a “once-in-a-generation” snowstorm brought wind, rain, and bitter cold, airlines canceled more than 12,000 flights in the days leading up to and including Christmas Eve. But while numerous airlines were affected, the brunt of customer’s ire fell on Southwest Airlines.
In total, Southwest Airlines was forced to cancel nearly 17,000 fights and lost over $800 million in revenue. The company is also facing an investigation by the U.S. Department of Transportation, while becoming the subject of its very own SNL skit.
The company’s public perception also took a massive hit. According to PeakMetrics’ data, Southwest Airlines was the most prominent narrative in the media the day after Christmas with over 30,000 mentions--and an overwhelming number of these were negative. PeakMetrics tracked an overall 23% increase in negative sentiment towards the brand when compared to November 2022.
But if no airline was immune to the December snowstorm, why was Southwest Airlines front and center--and could the company have done something to prevent the massive fallout?
Southwest Airlines’ Fall from Grace
With December 2022 still fresh, it can be hard to remember that, for a long time, Southwest Airlines has been one of the country’s most popular airlines. This popularity dates back for years; most recently, in May 2022, a survey by firm J.D. Power found that Southwest Airlines was ranked number one for economy passengers. It’s also been the country’s most profitable airline for years. And, according to some analysts, that popularity is so strong, not even December’s fiasco can change the company’s leading position among U.S. airline carriers.
It could be this very loyalty that led to so much attention when compared to other airlines. In December, Southwest Airlines made up a quarter of the total media mentions of various airline carriers, a far greater percentage than the next most mentioned carrier (Delta at 16.7%).
While Southwest Airlines had the most cancellations in December, it was far from the airline with the most cancellations or delays during 2022. In fact, this past year, Southwest was actually the carrier with the smallest rate of customer complaints. Perhaps this popularity was part of its undoing in December. Customers simply expected better.
Where Southwest Airlines Went Wrong: The Three Most Common Narratives
PeakMetrics tracked the most common narratives in the media and on social media for December surrounding Southwest Airlines. The top three results were the following:
Customer outrage, frustration, and disappointment
Customer service for all travel problems (hold times, new flight bookings, lost bags, inconvenience, etc.)
Negative sentiment towards Southwest CEO
Upon closer examination, these narratives provide valuable insights into where exactly Southwest went wrong. It wasn’t just about the cancellations but also a lack of transparency and corporate greed.
Lack of Transparency
5,678 stories contributed to narrative number one, making it the most prominent theme in the media in December, and this isn’t surprising. Frustration over cancellations is to be expected. However, there was a hidden piece to this narrative, one that might not be so expected: a lack of trust. Not only were customers enraged, many did not believe that “Southwest is being honest about the reasons for these cancellations.” A fringe site even went so far as to tie the cancellations to a COVID vaccine conspiracy.
This lack of trust was notably carried over into narrative number two, which was found in 1,748 stories. Customers were not just frustrated by the level of service they were receiving but they had “low confidence they would be compensated appropriately.”
These narratives had a significant impact across the information environment, prompting major changes in consumer research patterns. Predata, which detects and quantifies shifts in online research patterns, identified that the narrative around Southwest prompted the highest level of research into “flight cancellations and delays” since the beginning of the pandemic. Notably, this spike occurred at the same time as increases of research into all the major U.S. airlines; however, research into Southwest Airlines increased more than 5 times as much as any other carrier.
Ultimately, not only were customers understandably frustrated and angry about their disrupted holiday plans, but they were not sure how or if they would be compensated for lost travel costs. These concerns are not unfounded. As of the beginning of February, many customers are still waiting to be refunded, even though they were supposed to be repaid within 7 days of the canceled flight. Had customers had confidence in why the cancellations happened in the first place and that they would, in fact, be reimbursed, the company may have been able to minimize negative sentiment.
The “Corporate Greed” Piece
The one other element that overshadowed the Southwest narrative was greed. In 2020, during the height of the pandemic, the company received $7 billion from the U.S. government to support its operations at a time when no one was flying. Yet, as became clear in December, none of that money went towards updating the company’s legacy software. At the same time, the CEO received a raise of $9.1 million.
One of the Tweets that “moved the needle” in terms of the Southwest Airlines narrative
This seemingly conflicting data would only add to customer anger in December. Key components of narrative number 3 (negative sentiment towards the Southwest CEO) were anger towards the CEO’s salary, a feeling that the airline treats both customers and employees poorly, and the U.S. Department of Transportation should conduct an official investigation. Concerns about “airline greed” are not new, but December was perhaps the most visible manifestation of the problem. It’s also arguably why the Department of Transportation ultimately decided to investigate.
What Southwest--And Other Companies in a Crisis--Should Do Going Forward
Did fresh memories of a bailout coupled with confusion about reimbursement policies make Southwest Airlines the face of the December airline fiasco? If the company wasn’t so popular with customers to begin it, would another airline have taken the spotlight? It’s impossible to know, but better transparency--about where that bailout money went, how employees are treated, and what exactly their refund policy is for cancellations--would have been a good start.
Transparency will also be key going forward. While some analysts may argue that the brand’s reputation hasn’t been permanently damaged, many customers have sworn never to fly with Southwest again, and others are still in doubt that the snowstorm was the real reason for the mass cancellations. Southwest is also still facing an active Congressional investigation, meaning there’s still time for other, more problematic narratives to emerge.
The biggest brand crises of 2022 showed that, thanks to social media, customers increasingly have more power over brands’ reputation. Negative narratives spread--fast--and then spread through the broader media ecosystem. For companies to effectively respond to crises, they need to know what these narratives are. Had Southwest had better insights into the negative narratives surrounding its flight cancellations from the beginning, they might have been able to mount a better crisis response.
Going forward, having tools to monitor--and counteract--negative narratives will be essential not just for Southwest but all companies.
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