Travel Tech

Negative word-of-mouth can destroy a company’s reputation and cause serious damage to its brand. With the advent of social media, negative feedback from customers can spread faster and further than ever before. Understandably, many companies will go out of their way to avoid attracting negative reviews from customers. But accidents do happen and every company makes mistakes, sometimes causing outcry among those who have used the company’s products or services.

However, all may not be lost. A fascinating piece of research by LoyaltyOne has actually tried to prove that the impact of negative word-of-mouth may not be as bad as commonly believed. In fact, it may even increase positive engagement, while encouraging consumers to make use of loyalty schemes.

This sounds counter-intuitive and goes against all the conventional wisdom marketers are accustomed to hearing. The full study, available here, offers an intriguing conclusion, which is certainly worth taking the time to digest.

The research by LoyaltyOne was specifically focused on a loyalty programme, however the study offers important and useful takeaways for marketers about the potential that negative word-of-mouth offers for increasing engagement.

All Press Can Be Good Press

LoyaltyOne selected popular airline loyalty scheme Air Miles as the subject for its study. The trigger was that when Air Miles changed some of the scheme’s rules, some customers were annoyed.

This is nothing new. Most changes a company makes attract a certain level of dissatisfaction from some of its users. Just look at what happens every time Facebook introduces a change to its features or appearance – droves of people threaten to quit the platform for good.

Air Miles had predicted that some of its users would have negative reactions to the changes. As with any established loyalty scheme, when rules are changed, there are usually numerous members who are highly vocal about expressing their opinions. There were varying levels of negativity contained within the comments, with some customers only mildly upset by the changes, while others were highly annoyed and expressed their dissatisfaction far more forcefully.

All is Not Lost

LoyaltyOne’s researchers analysed the comments against a control group, and discovered the most vocal respondents were actually the more valuable customers.

These results brought two main considerations to light. Firstly, the loyalty programme members who are most vocal in their negativity also tend to be the best customers. They are passionate about the brand and take the time and effort to make their feelings known. This passion is useful, because it can help marketers design an effective crisis management strategy.

Secondly, analysing the content of negative comments can provide helpful insight for brands to figure out precisely why customers are upset, and guide appropriate action to address the issue. In the case of Air Miles, researchers concluded that many of the aggrieved customers were upset because they felt emotionally invested in the loyalty scheme. Their initially high engagement level was what spurred them on to such heights of negative commentary. Apathy would have meant they didn’t care, and were probably less loyal customers.

Don’t Fear the Power of the Vocal Consumer

The LoyaltyOne study is important because it can give brands some reassurance and help them regain some semblance of control. With the power of social media being what it is, customer voices obviously have great reach. So now we know: the angriest customers are often the most valuable. In fact, LoyaltyOne found that they angry ones were 70% more actively engaged with the brand than the apathetic ones who didn’t post at all.

Negative word-of-mouth is likely to affect every company at some point. LoyaltyOne suggest the following curse of action:

  1. Look at the data to see what’s going on
  2. Take action if there is increased negative sentiment
  3. Be swift and sincere in responding
  4. Make the response highly public
  5. Monitor the customer sentiment attentively

When handled properly, negative word-of-mouth can actually increase customer engagement. In a nutshell: no brand can afford to ignore the reality of negative word-of-mouth in our social age. But, fear not, it can indeed be leveraged for the eventual benefit of your brand.

More from #DTTT

  • In May we present:
    What’s the appetite for Travel? with Beautiful Destinations – Weekly Tourism Impact Call: Week 11
    DTTT · What's the appetite for travel? with Beautiful Destinations Recovery is now in sight for many destinations and much is being done to improve destinations to make them safe and ready for travellers when they arrive. Whilst the focus has been on the impact to destinations for much of the pandemic, this has now [...]
    #recovery #COVID-19 #beautiful-destinations #industry #tourism #travel
  • In May we present:
    Sustainability Opportunities for Destination Recovery with Dr Cara Augustenborg – Weekly Tourism Impact Call: Week 10

    Sustainability is a key issue for the industry as it prepares for recovery. The fast-moving pandemic has been severely disrupting tourism and its impact will change the industry, academic engagement, and customer behaviour. The question many destinations are now asking is how can we be sustainable post COVID-19? We dedicate our tenth Tourism Impact call […]

    #ecotourism #recovery #COVID-19 #sustainability #industry #tourism
  • In May we present:
    Digitalisation and Sustainability solutions for recovery – Weekly Tourism Impact Call: Week 9

    As part of our efforts to react and support the industry, the #DTTT began hosting our popular Tourism Impact calls 2 months ago. Now going into the ninth consecutive week, we reflect on what has been an interesting and insightful journey so far. In many lively discussions, we’ve shared perspectives about COVID-19 impact, destination strategy […]

    #recovery #COVID-19 #sustainability #digitalisation #industry #tourism
  • In May we present:
    The Nordics COVID-19 Response

    How have the Nordic countries responded to the crisis? At the #DTTT, we have seen different approaches throughout the Nordic region and wanted to find out more. In a highly insightful interview we brought together the Tourism boards representing the capital cities of Norway, Sweden, Finland and Denmark to discuss their response to the COVID-19 […]

    #The Nordics #Response #COVID-19 #DMOs #marketing #strategy
  • In May we present:
    What travel will look like in the future with Doug Lansky – Weekly Tourism Impact Call: Week 8

    In our highly anticipated eighth Tourism Impact call, we discussed the different approaches of destinations who are at various stages of the recovery process. Recovering destinations are now looking for innovative product solutions as restrictions begin to ease and businesses start to re-open. Whilst for other destinations their recovery plans are still at the research […]

    #Doug Lansky #COVID-19 #DMOs #industry #strategy #tourism
  • In April we present:
    Designing the Future of Tourism – Weekly Tourism Industry Impact Call : Week 6

    At the #DTTT, we are working closely with destinations to find out what’s going on behind the scenes. A different week brings different perspectives. This week on the #DTTT’s sixth Tourism Impact Call, we discussed the role of technology and innovation as a solution for the industry, as well as featuring innovative community initiatives, and […]

    #COVID-19 #industry #product #strategy #technology #tourism
Show more
© 2017 Digital Tourism Think Tank