The curse of 'Empirical Logic'
It's easy to see through the idiocy at Spirit Airlines if you consider what I call the 'curse of empirical logic'. It takes two weeks of bad publicity and threats of boycott to get Spirit to refund a dying Vietnam veteran for the ticket he is too sick to use. The usual CEO apology too is thrown in, but the damage’s done.
What is the curse of empirical logic? It’s an affliction that sees businesses focusing myopically on costs, thus evaluating everything in terms of cost-numbers. Look at it from Spirit’s point of view. They do their business with wafer thin margins. Any rise in costs puts their business model under strain. So when they are faced with a refund (never mind it’s a dying veteran), all they are thinking is ‘rising’ costs. What makes the situation worse is Spirit people not being able to predict the bad publicity that may follow (it’s in the future and therefore invisible, you see). Plus they can’t easily put a money value to such lousy publicity.
I don’t know if there’s research to show the costs of preventing bad publicity to be less than what’s the fallout of bad publicity. Anecdotal evidence seems to suggest it. But beyond such evidence, businesses most learn to break out of their myopic business numbers perspective. They must learn to engage, keep consumers, and thus lower costs. Spirit on its hand should have refunded, incurred that extra cost, and built through the gesture, goodwill. Such goodwill may not see an immediate impact outcome in terms of increased sales, but in long run, it will.
What is the curse of empirical logic? It’s an affliction that sees businesses focusing myopically on costs, thus evaluating everything in terms of cost-numbers. Look at it from Spirit’s point of view. They do their business with wafer thin margins. Any rise in costs puts their business model under strain. So when they are faced with a refund (never mind it’s a dying veteran), all they are thinking is ‘rising’ costs. What makes the situation worse is Spirit people not being able to predict the bad publicity that may follow (it’s in the future and therefore invisible, you see). Plus they can’t easily put a money value to such lousy publicity.
I don’t know if there’s research to show the costs of preventing bad publicity to be less than what’s the fallout of bad publicity. Anecdotal evidence seems to suggest it. But beyond such evidence, businesses most learn to break out of their myopic business numbers perspective. They must learn to engage, keep consumers, and thus lower costs. Spirit on its hand should have refunded, incurred that extra cost, and built through the gesture, goodwill. Such goodwill may not see an immediate impact outcome in terms of increased sales, but in long run, it will.
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