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Cathay Pacific’s second pricing blunder: A silver lining for PR?

For the second time running withing the span of a month, Cathay Pacific has again mistakenly offered hugely discounted prices on its first class flights. This time the route was from Portugal to Hong Kong.  A quick check by Marketing found that the flight fares are now back to original rates on the airline’s booking site.

During the previous incident approximately two weeks ago, Cathay had said that it would honour the tickets sold at a discounted price. And this time, reportedly, the brand will be doing the same. While the airline did not share how much honouring its promise would cost to the company, the round trip first class fare with taxes and surcharges per adult between Hanoi and Vancouver costs about US$38,000.

This time, in a statement to Marketing, the brand said, “We are aware of an error on some fares from Europe on our website because of an input issue. The sale of such fares was stopped immediately. We are looking into the root cause of this incident both internally and externally with our vendors. For the very small number of customers who have purchased these tickets, we look forward to welcoming you on board to enjoy our premium services.”

And while it might come across somewhat silly to be making the same mistake twice in a row, in a conversation with Marketing, Nick Foley, president, SE Asia Pacific and Japan at Landor said that the PR for Cathay has been substantial as a result of this situation.

“Additionally, many customers will get to experience a level of service with Cathay that they usually would not. Ultimately, word-of-mouth endorsements are the best form of PR for a brand. I believe this is something that will yield nicely for the airline in the months ahead,” Foley added.

He added that it is unlikely the current challenges with fare structures will do any real damage to the Cathay Pacific brand given it is not a safety issue.

The greatest risk to brand equity within the aviation sector occurs when airlines have problems with maintaining safety.

This is not one of those situations and so far the airline managed the situation well and if it can continue to honour the prices quoted, then it will reflect well upon the airline. “The focus should now be on ensuring that all fares are quoted correctly thereby mitigating any further risk to profit margins,” Foley said.

Agreeing with Foley, Kelvin Koo, regional CEO of Asia, FALCON said from a consumer perspective, the blunders wouldn’t affect their brand image given it is not a safety, product or a website UX issue.  “I believe the brand has said it will honour the deal and while it might hurt [the bottom line], it is the right thing to do.”

 

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