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When Discounts are Disgusting: Best Practices in Small Business Advocacy

A news report from last week suggests that Carnival Corporation, the company which owns and operated the shipwrecked Costa Concordia cruise liner, is offering survivors of the disaster 30% off their next Carnival cruise.  Two things come to mind: 1) Wow, Carnival marketing and PR executives are clearly out of touch with the level of human tragedy and suffering caused by the wreck and 2) Carnival marketing and PR executives are obviously not ECSB members, as otherwise, they would have known better than to use future discounts as a way of engaging customers who had a negative experience.

When customers have a bad experience with a company, the last thing they want is to repeat it.  Last summer, ECSB’s Summit focused on customer advocacy and, as a part of that study, we explored the best tactics for engaging detractors.  When you drill down to the tactic level, offering a discount on a future purchase is the worst thing you can do.  Not only does it not improve customer sentiment, it makes things worse as it ASSUMES they want to do business with you again.  Given the extreme nature of the incident, Carnival’s marketers should not have been surprised by the outrage felt amongst survivors when offered the 30%-off coupon.  The LAST thing they want to do is to take ANOTHER cruise with Carnival.

For more insights on dealing with detractors, see Part 3 of our Summit report, Driving Active Advocates: Boosting Referrals and Recommendations Among Small Business Owners.

Comments from the Network (1)

  1. Pete Healy
    on February 6, 2012
    Respond

    Well done! A perfect example of what can happen when marketers don’t think–or feel–in the rush to boost revenues. Carnival has almost certainly destroyed much of its brand equity for some time to come.

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