We Fixed It. You're Welcome.

Aaron Wolpoff [0:14 - 1:36]: All right, here's how this works. In each episode, we pick a company we all know that has something going on right now. Then we put ourselves in charge and see if we can fix it. You'll be hearing from Melissa in operations chief, Gino on people and culture, and me on marketing. My name's Aaron. As always, a quick disclaimer. We are going into this somewhat cold, and nothing we say should be construed as legal advice, financial advice, or anything that would get us in trouble. These are our views and opinions. We're here to ask the kinds of questions everyone's thinking, have an engaging conversation, and maybe come to some conclusions that we feel are worth exploring by the end. If We Fixed it, you're welcome. All trademarks, IP and brand elements discussed are property of their respective owners. Welcome back to We Fixed It. You're welcome. Today we're going to talk about a company we all know some of us may love or luv love if you follow their stock fluctuations. But we'll get to that in a moment. If you're a new listener, thank you for joining the growing numbers of fixaholics out there. We are your fearless fixers. You've got Melissa on operations and customer experience, Chino on HR people and culture. We're joined by Sam on finance. And me, My name is Aaron and I come from a marketing perspective. I feel like I just introduced us as a band we could, but we're not here to play freestyle jazz for you, as fun as that would be. We're here on a mission to fix the world one company at a time. So please, Melissa, tell us which company we are fixing today.

Melissa Eaton [1:36 - 3:53]: So today we're talking about Southwest Airlines, a company that's changed the way we fly by being a brand that we love. We're going to explore the story behind this brand and and what's shaped them in the moments that make or break them. This also applies to other companies, so we can also include some of those conversations and companies as well. But today's focused again on Southwest Airlines. They've really revolutionized air travel. They've been the rebel of the skies for decades, but a rebel with love and heart. But recently, that promise has been called into question. And in a series of shocking announcements, Southwest revealed it's making mass changes that go against the very grain of their brand and what they've always, always been known for. And they aren't the only ones making these brand missteps. As I mentioned, founded in 1967, Southwest took off in 1971 with a bold mission to make flying affordable and accessible to everyone. And Southwest wasn't just about these cheap tickets. It was about personality. Quirky flight attendants that sing songs, peanuts and punchlines made flying fun. And then there were policies that won our hearts. So no change fees, free checked bags, and a loyalty program that actually worked for. For customers. So speaking of loyalty, they launched their Rapid Rewards, one of the first airline loyalty programs in the industry. No blackout dates, no complicated tiers, just straightforward points you could use. It became kind of their cornerstone of Southwest's customer first ethos. But now they're facing a crisis in identity. Their recent announcements introduced luggage fees, assigned seating, and cuts to Rapid Rewards value. For a brand built on being different, these changes felt like a real betrayal to their customers. So social media is abuzz with outrage. I would share some of those things, but I think all of you have seen those online. So is Southwest losing its soul? Let's unpack this and decide as an expert panel here whether this is a necessary evolution for business or whether it's a brand destroying misstep. Take it away, panel. Who wants to start?

Aaron Wolpoff [3:53 - 3:55]: Well, losing its soul, that's a. That's strong.

Sam Palazzolo [3:55 - 3:56]: That's strong.

Aaron Wolpoff [3:56 - 3:58]: So do we start there?

Melissa Eaton [3:58 - 4:03]: Yeah. Aaron, tell us, what do you think, Mr. Brand of Man?

Aaron Wolpoff [4:03 - 4:57]: I think it takes a lot for a company to lose its soul, you know, publicly, in real time. Introducing a new wave of fees and reforms is not necessarily soul crushing, to the point where people would look at them and say, I can't follow them anymore. It's maybe the equivalent we've talked about Netflix. Netflix does these price hikes, right? And it's just a fact of life. And if you're a subscriber, you know you're going to pay. You like Netflix, you want to stay with them, you're going to pay. So Southwest hasn't done it for a long time or maybe ever. Some of these, you know, changes they're putting into effect. So it's shocking. It's shocking to see it come from Southwest, but I'd say the loyalists that have flown Southwest for years will continue. It's their brand. It's their company. It's probably going to be business as usual once they get over this initial shock factor.

Melissa Eaton [4:57 - 6:34]: But do you think that. Because I really feel like that is their brand. The no luggage fees, the open seating kind of the cattle herding mentality, the no change fees. I mean, they made it so easy. That to me, Erin, I feel like it really is increasing this friction for the customer and really eroding Trust. And I'd be interested also, Chino, because like, they have been known to hire people that live into this, like, quirky, like we do everything for the customer that we can. And, and then also from a business perspective, Sam, whether those baggage fees, like what I'm looking at and what they're bleeding out in high fuel costs and operational inefficiencies, is that really going to help them? Because I'm not really sure that they would be able to recoup that. And the other thing, Erin, that I saw online, which I agree with too, and I talked to somebody yesterday at CEO who has flown Southwest before and he said same thing, is that their planes are not the newest planes. So they don't have like the TVs in seat, they don't have the like, you know, the charging, you know, outlet underneath the seat. So why would I pay more, you know, for them when I actually could get an assigned seat that has all of that with another airline? So anyway, Chino, Sam.

Chino Nnadi [6:34 - 7:49]: Yeah, I think it's really interesting because obviously their brand ethos was being kind of that quirky friend that you can rely on that, you know, you got the no checked bag fee, which is huge, where you know, even if you have a carry on in some airlines, you have to actually pay for a carry on luggage. Right. And it's interesting actually. So Frontier Airlines has actually come up with a campaign saying, we're actually not going to do this anymore. We're not going to charge on checked bags, kind of as a dig to Southwest Airlines. So it's really interesting because, you know, unfortunately there's obviously the financial aspect of, you know, airlines hemorrhaging cash. And Sam, I'm sure you'll get into that. But, you know, the reality is, if this is your brand ethos, what are you doing for your team, for your people, for your loyal customers to still say, hey, we're, you know, we're still your friend. We just have to kind of raise prices so that we don't go out of business. And I think that really is the questions on how they can kind of overcome the financial reality while still being that fun brand that has been what they've been known for.

Sam Palazzolo [7:49 - 13:19]: Yeah, it's, it's an interesting point. Chino, Let me just start off by saying this much that in business there are two ways to make money. You can innovate or you can nickel and dime your customers. Southwest just chose to do the latter. Short term gains, absolutely. Long term brand erosion, almost guaranteed. So let me start off also by playing A two truths and a lie. Two truths and a lie. Let's see who can guess the truth or the lie. So two truths. One, Sam was involved almost in a Southwest airline crash. Two, as a result of that crash, or almost crash, Sam got invited to join Southwest customer advocacy panel. And third, Sam actually got to fly the plane that almost crashed. So, true truths and a lie. Which one is the lie flying? It's the last one. I have flown with a naval aviator who flew with Southwest, but I was almost involved in a Southwest plane that almost crashed. The right engine sheared off. It was panic. It was terror. But I'll never forget two things. One, the flight attendant who was in the chair facing backward to everyone, had the most angelic smile on her face, and she was wearing this shade of red lipstick that I've never seen to this day. And she didn't panic. There was never an ounce of fear. And I thought to myself, three thoughts. One, earlier that morning, for some reason, I had outreached to everyone that I love, and I had had this really great conversation with them. And so I thought, you know what? If this plane's going down, at least I said goodbye to everybody, Right? Second, it's kind of my oh, crap moment. I didn't have any chocolate with me. And I've traveled for a living. I'm ex deloitte. I traveled 1 year, 50 out of 52 weeks, I wore Southwest out. But I can tell you this much. That day, for some reason, I didn't have any chocolate. And so I thought to myself, you know what? They're going to bring my dental records or my teeth to my mother, and they're going to be like, you know what? We think this is your son. But it's got this really weird substance on it. It's chocolate. My mother would be like, yeah, that's my boy. Yeah. But I didn't have any chocolate, so I didn't know how they were going to identify me. The third thing, though, and back to the flight. In and of itself, this flight attendant was only matched by the pilot who came on, who shared that, hey, look. Obvious malfunction on the right hand side of the plane. For those of you looking out at it, the gentleman who was sitting in that window seat turned around and looked at me, and his eyes were as big as saucers. It was one of those terrifying looks. I looked at him, I said, it's pretty bad, right? And he was like, yeah, it's bad. But the pilot shared with us, look, we're doing what a plane does. We're flying. We're going to be able to fly safely on one engine and we're going to land. We're going to do not an emergency landing, it'll be a controlled landing. And we're making arrangements right now on the ground for us to have another plane. We'll get off of this one. Those of you that want to carry on, we'll keep on going. Those of you where it's more convenient if you were catching connections, we'll see if we can't have you catch connections at the airplane or at the airport. We're going to single handedly the greatest thing I've ever heard set everybody at ease. And when we landed, that pilot and that flight attendant stood right by the front door and shook everyone's hand on the way out. It was unbelievable. If you can imagine people dispersed into two lines. They, they either made a beeline to the bar early too. It was pre 9am or they went to the restroom to you know, clean stuff out. But. And I ran to the Hudson News to grab some chocolate. I'll, I'll never forget that. And I've sat on customer Advisory Council's for other organizations. But Southwest is special for a couple of different reasons because they really tap us to help architect the future of what customers like me and you want to see on the airline. Now there's a couple of financial figures that I'm honed in on today. One is $1.5 billion with a B billion. This is the anticipated annual revenue that charging baggage fees will drop into Southwest's balance sheet or financial statements, the income statement. It's a huge figure because last year in just one quarter they lost over $200 million. That's a big figure. Now is that because of their economics? Southwest has always been great at buying fuel in advance at cheap prices. And so is some of that coming back. Has everybody else gotten smarter? I don't know. The other figure I'm looking at is 5%. 5%. When Southwest just announced that they were going to do the baggage claim when they were just announcing they're going to do some layoffs, the first ever the Stock went up 5% which means that investor sentiment, they like that, right? I have more but let me pull up there.

Aaron Wolpoff [13:19 - 14:13]: Well, I think some of the key difference between your stuff's a great story about the flight and how it was handled. The difference between that and how the news has been communicated about the baggage fees and you know, the other things that are impacting consumers is that it was very, very even keeled it was businesses, you know, here's a transactional business situation. Here's what you need to know. And there was no, you know, for a company known for heart, it could have been delivered with heart. Right. And I think we would have seen a much better reception from it. And because it was delivered so in such a calculated manner, maybe it had to happen. I don't know. It certainly is better for them financially. But. But since it was presented in, you know, such a. The way that other companies communicate, not the way Southwest communicates, that's. I think that's why we're seeing so much of a pushback right now.

Chino Nnadi [14:13 - 15:49]: I would agree. And I think, too, like, having a cheeky campaign saying, hey, if you want to keep flying, we stay in business. Right? Like, you know, make it fun, make it. The friendly voice that we're used to is imperative. And I think going to your. Your story, Sam, about kind of that flight attendant sitting there, even killed in such a horrific, you know, time where, you know, I just came to Chicago, I was sitting right by the. The wing, and I was just looking at that engine the whole time. I'm like, okay, do your job. And, you know, just in light of all of the different things that have been going on in different airlines. But I think I. I know their talent and kind of their hiring has been exceptional. Right. They find people that live true to kind of their brand promise of delivering excellent customer service. And I think, you know, I wonder if there's an opportunity for them to kind of lean on their team again, whether that being a better brand campaign positioning, sharing. Hey, we had to do this. We're so sorry. Here's how we're going to make this better, because I think if you have the option of choosing between an expensive flight who doesn't care or an expensive flight where there's great customer service, you're going to pick the great customer service in lieu of maybe not the newest airplanes. Right. And I think there's something to be said for that. Like, customer service can make the. Make it break a brand. And I think if they can lean into that as well, it can help rebuild some of this brand perception that they've lost.

Melissa Eaton [15:49 - 18:45]: Yeah, I totally agree with all of you. I think what you have outlined, Sam, is really important that it's a business. At the end of the day, Southwest Airlines is a business. We all understand that there are rising costs, there's operational challenges. There's all of those kinds of things. I think what Erin and Chino, you've reached to is that Knowing your differentiators, knowing how the best way is to communicate something, and it can be cheeky, and it can be, you know, it can be fun. I think they tried to do that in their Twitter response that when the backlash started happening and they tweeted out, we didn't trade Luca, which, you know, is a basketball reference to Dallas trading Luca Doncic. You know, it. It didn't. It kind of fell really flat because it's like, no, you kind of did trade it because you traded our loyalty to your brand for dollars. And we might be willing, to the point that Sam just shared, our loyalty might be more to your people and your team and the experience, and we might be willing to pay for the luggage. We might be willing to pay for an assigned seat, but maybe there was a different way in which to communicate that. And empathy is essential. Knowing, like I said again, what makes Southwest special is what they do there. And really kind of leaning into that and playing into that. And so it's interesting to me that to Aaron's point, it kind of came out in a very business, like, you know, all. All of Southwest. You know, I'm a loyalty Rapid rewards member. Get the email, and it just says that and it has the date on it. And you're like, what? Like, yeah, that just didn't really feel like them. I was like, wondering, like, is this really them? Right. Because it does. It didn't feel like that. And, you know, there are opportunities, you know, especially in today's world. Like, we've talked about all of these brands. Starbucks, Tick Tock, all the. The cancel culture. Like, you got to be really careful about what you're doing these days because it's a fragile state of affairs, you know, when people are. Are doing it in. In such a manner. I mean, I was already seeing people complaining about Southwest because they were always like the low fare, cheap fare. Right. And I laughed because this happened to me. I was like, looking for flights and it was like, oh, $49 to the place to wherever I was trying to fly to, but like $399 to get home. Right. So it doesn't make it more, doesn't make it cheaper. Right. You know, but like, it used to be where you could get $49 leg, you could get a 29 DOL. Yeah, it was way cheaper. And, you know, and in those circumstances, yeah, maybe I would have been willing to pay for back. Right. Because I'm already saving so much money. So. Yeah.

Chino Nnadi [18:45 - 20:01]: And going back to even past podcasts where we talked about duolingo and how brilliant their marketing was. Right. You know, I do understand that, you know, it's a business, we all do. And I think leaning into that and just sharing, hey, you know, we have to make money somewhere and you know, we're gonna maybe undercut some of the other people to save because if you weren't doing it, you know, $1 is better than $0 to begin with. But finding a way to do that, or if you're even having a loyalty program for the people that are flying, quite often it's like, okay, well, on your fifth flight you get a free, you know, checked bag or whatever it may be to kind of help with those customers who've been loyal to you. Is a really great idea to again, be honest with what's going on. I think, you know, everything in life is going up. And so we're, we're all expecting it. Right. Netflix has raised their subscription, you know, etc. Etc. But I think being able to communicate that to the people who go back to your brand is incredibly important. And without doing that, you lose customers. It's, then what loyalty do I have to Southwest Airlines? I'm just going to take the next cheapest or if it's all the same price, I'm just going to go on a better plane.

Sam Palazzolo [20:01 - 23:20]: Yeah, we, we have seen this time and again with domestic air, with domestic travel companies, it is a proverbial race to the bottom. Warren Buffett says that this is the least performing sector. He no longer invests with any airline. And if you think about these communication faux pas or miscues, they're littered in the domestic US Airline industry, whether it's Delta and their faux pas screw up of how it is that they changed around their loyalty program. If it's JetBlue leaving a plane on the tarmac because of winter conditions for three hours and not letting anyone off the plane. The domestic airline industry is littered with these types of mistakes. And the thing we've got to keep in mind is this race to the bottom. Where is it taking us? When you look at international airlines and three of the top international airline or three of the top airlines from a customer experience perspective are all international. We have Singapore, we have Qatar Airlines at the top. We've got Singapore Airlines second and we have Emirates coming in third. And I flew Emirates last year, year. And no, I did not sit next to Penelope Cruz, but, but a second best. It was my wife. Here's what we recognized. This is a superior airline. Not only from a performance with the efficiency that everyone boards the plane and exits the plane, but just from the level of service and the, just the all out comfort. Now I'm not expecting a domestic travel, a flight that's 40 minutes from me here in New York to Cleveland. For examp for there to have the ultimate luxury. If I wanted to do that, we'd fly private. But I do expect to be able to hop on a Southwest airline jet and because I want to get away, maybe back to Melissa's point. The airfare may be $49, but guess what? We've seen an erosion in pricing that benefits the customer over the last five to ten years with Southwest. They've almost done away with those want to get away fares and it is, if not as much more expensive. And so why would you fly that? That doesn't make any sense. I can tell you what's to blame though, because I'm not here to cast blame on Southwest senior leadership. I'm certainly not trying to cast blame on their competitors who've helped race to the bottom. I would blame there's a very activist investor who has had tremendous influence at Southwest and it's the Elliott Investment Management Group. I know these folks, they're not bad folks. But for some reason they are putting the proverbial arm wrestle chokehold on Southwest to do some things different. I don't know what the big game plan is though here. It doesn't make any sense to me. It's a wonderful brand, it's got wonderful ecosystem and associates employees throughout the country and now the world. But why are, why are they doing these things? It's kind of a mystery. And this is coming from somebody who sits on the customer advisory council.

Aaron Wolpoff [23:20 - 24:58]: Yeah, agreed. And it's, you know, companies are for profit. There's nothing wrong with that. And there's nothing wrong with, you know, if you hit a point where you say we can't operate the way we've been operating, so sorry, we have. We're a for profit venture. We have to see this through. There's still a way to do that. And you know, you and I talked about Warner, Warner Brothers and DVDs last week or last episode. You know, there's still a way to bring at least your loyalists along. You don't want to lose your base and there's a way to communicate it. And with Southwest, it, you know, it should be fun and playful. Larry, like, you know, you came up with some great ideas about how to, how to have some fun with the fact that we're going to charge you more. But you can get your loyalist to Say, haha, I know, great, thank you. You're still going to do the things that I like about you and you're going to do that more. But I think there's, you know, in order to keep your base, you've got to have a trade off too. You got to say, we're going to charge you more. We all know it, we all recognize it. There's a right way to communicate it. Obviously that hasn't happened yet. I stand by my initial thought that there will be a recovery, people will get over it. But, but what is that trade off? And it can't be we're going to charge you more and we're still going to be, you know, the discount airline and you know, no, no frills. Right. And we're seeing a little bit of that. Like you can start to use your points toward hotels and I think you couldn't do that before and things like that. And, but I do think we're going to see more customer rewards come out of it. And I don't know what exactly what that'll be, but they've got to do something to say to their, at least to their base, we've got your back and I want to see what's going to happen from here.

Chino Nnadi [24:58 - 24:59]: Yeah, yeah.

Melissa Eaton [24:59 - 25:19]: I think the recovery is going to be super important because to your point, Erin, like, it's already out there. There's already all this noise, there's a lot of disgruntled customers. I mean, the fact of the matter is, from a business perspective, 60% of Southwest flyers are loyal customers.

Chino Nnadi [25:19 - 25:20]: Right?

Melissa Eaton [25:20 - 27:22]: They're part of the rapid rewards program. If that loyalty program just dropped 10% percent, that's a reduction of $1.2 billion. So again, like, what are, what are, you know, it's, it's like the short term gain for long term, you know, deficit, you know, all these kinds of things. But I agree, I think that one of the ways to recover would be just to own it. Just to say, we didn't mean to like break your hearts. Right. You know, and then do something about like, I mean, they can make it fun. Like they don't have like a United Club or Centurion Lounge or any of this stuff. Right. They could say, hey, we have a baggage club. Want to join? Like make it fun and say for, you know, you pay an extra $200 a year, you get to take your bags for every flight that you want. Right. Like, something like that I think would make the customers feel better. And then like explaining like, hey, you know, like for Every person that brings a bag on this is how much it's costing us. And, you know, we'd like to be able to offer you peanuts, but now we're not even going to be able to offer you peanuts. You know, just those kinds of things. I think that there is a way to transfer that into, like, recognizing their loyal loyalists and then. Then also saying, hey, help us out here. Right To Sam's point, from a financial perspective, you know, help us out. We're going to have to start charging for assigned seats. We're going to have to start charging you for bags. You know, but what could we do differently? You know, And I'd be surprised, too, Sam, because one of the things that I think is nice about not having the assigned seats for them is that they don't have to have that software in a program to do that. They're going to have to invest. You know, we all saw what happened when their software went down for, you know, they're going to have to upgrade all of their. That's an investment. That's millions and millions of dollars of tech investment. So it'll be interesting to see. Yeah, I'm sorry.

Chino Nnadi [27:23 - 28:55]: No, no, no, no. I was just going to say too, like, we're talking about, you know, the need for business, which is one thing, and kind of how they can rectify it in that time of kind of transition. But I think what's important to talk about, too, is the blowback to their team if they don't do something, because if they're known for customer service. And, you know, Sam, again, going back to that incredible flight attendant where if you're getting yelled at, if you're, you know, people are disgruntled, you're not going to always have the brightest smile. It's going to. It's going to wear your teams down. I think there's the blowback on that perspective, too, because the easiest thing you can do without an award or bringing in new tech. Right. Is that recognition. And it's the customer service having people kind of over compensate on the friendly factor there to make sure that your experience flying is big without really putting any, like, dollars towards that. That's the first thing you can do. But if every single person that is working there is getting yelled at because, you know, they paid for a seat and somebody moved, and now you have to check your bags. And my. It was $29. When they're telling me there's this hidden fee, that's going to be a problem. So how are you preparing your teams in the Interim while you're in this transition, right. So that they can keep that smile on their face. Continue to have excellent customer service while dealing with the blowback, while you're figuring it out, I think is really important and will be key for them to implement in this transition.

Melissa Eaton [28:55 - 30:44]: Yeah, we always, in the customer experience world, we call those moments of truth. Right. So this is really, you know, and to the individual. So whether it's the gate agent, whether it's the flight attendant, whether it's the person on the phone because you're calling in a travel agent, whatever it might be, there is that place and time where they can make a huge difference. And to your point, Chino, it's not just expecting our team members to be able to answer those questions or respond in kind or respond in a way that is professional and fun and. And stays true and loyal to their company. They need to be trained. They need to have a talk track. They need to know what they can do. I mean, one of the things that I think was always fun about Southwest is you felt like the gate agents had authority to do fun things, right? Like when there were delays, right? Like they used to do, like karaoke contests, you know, and, you know, the karaoke winner wins like a whole water and peanuts and it was just fun, right? You know, those kinds of things. And like, the funniest things that they would do, they would like, we're going to upgrade. I was, you know, in LA once, and they did this. They were like, we'll upgrade. The first person who shows us that they have a hole in their sock, right? And so, like, you know, people are throwing their shoes and like, running up because they wanted to get in the A group, right? You know, that kind of thing. So I feel like, you know, giving that power to their team is truly going to be really one of the things that needs to happen. Because this seems like, to Sam's point, the decision came not from the team, but from somewhere higher up. So how about other companies?

Aaron Wolpoff [30:45 - 30:59]: Yeah, Melissa, I was going to ask you, you want to give us a little roundup of some other companies that have gone back on whether it's spoken or just kind of known on a fundamental brand, you know, truth that everyone has known and loved them for. And what happens in the aftermath of that?

Melissa Eaton [31:00 - 32:57]: There definitely have been recently a few companies that have had brand. What we would call brand missteps. So a perfect example is 7up, you know, which has always been known as the caffeinated soda introduced, seven UP Retro, which was supposed to be caffeinated and people were very confused and it, they were disappointed because they specifically choose 7up for its caffeine free state status. So they felt like the brand, you know, was diluting its identity, alienating its core audience and sparks debates about whether 7Up is trying to compete with all other drinks or just, you know, or within the non caffeinated field. Another one that was a little sneakier that I think that, you know, some of us might have seen, you might see the blowback on LinkedIn was Google, who removed don't be evil from its code of conduct. And they had been known for this informational motto, don't be evil. And they quietly removed that phrase from their code of contact in recent years though. And it just says has a more generic statement which is do the right thing. It's very similar, but I think that like people were like, wait, don't be evil was pretty strong and so do the right thing. Similar, but a little toned down. And so the change sparked a lot of criticism, many seeing it as a sign that Google was moving away from its founding principles and that it's also because of the way it's handled user data controversies around, there's a lot of controversy around AI and ethics and maybe that's time for another spotlight for all of us and antitrust issues. So kind of contradicting that spirit of don't be evil, kind of removing that phrase was interpreted as like a symbolic shift. Thoughts?

Aaron Wolpoff [32:57 - 34:05]: Yeah. When you know and love a brand, whether it's Southwest or one of the ones you mentioned, or any number of brands that have made a big misstep, and again, I'm not saying this is, this is a business situation, it's the way it's been handled. But when you know and love a brand, especially one that's been around as long as Southwest or some of the others, and they do something that's very contrary to what you believe about them, it feels, it can feel like a betrayal. Right? It feels like, I thought we, I thought we were friends. I thought I knew you. This is something that someone who cares about me wouldn't do. And I think that the only way the Southwest goes down is if they don't get ahead of it. They've got time and, you know, by the time this comes out, they may take some actions and they may even reverse their bag policy, who knows? But I think they've got a limited time window where they're allowed to not necessarily walk it back, but recontextualize and share more and be more transparent and implement Better loyalty programs and 3 times rewards or a merch store or something give back in some way. And I want to see what kind of actions they're prepared to take.

Melissa Eaton [34:05 - 35:03]: Well, and I also think that one of the things that you mentioned earlier was Netflix. And you know, there's so many of us that are very loyal Netflix, you know, subscribers. And their crackdown, for example, on password sharing was like for my family, devastating. We were like, oh no, you know, and like kids and whatever, whatever. But you know what? We got over it. So Aaron, to your point originally was like, will the customers get over it and just continue because they are loyal and they've had amazing experiences like Sam had be okay with it to a certain extent. I think that might be definitely in the, in their thought process of why they communicated it this way, like rip the band aid off and let's just go. But I do think that there's, there's some really nice things that they could do to rectify the feeling of broken trust that their loyalists have.

Chino Nnadi [35:03 - 36:17]: So also, I like to. Also I'd like to say too on the Netflix crackdown, that hurt. I am not over it. I will not get over that. Especially when you have, you know, you're paying for a premium for the family sharing plan and it's like, you know, sucks there. But with Southwest it's different because there are ways that they can rectify whether that just be, you know, creating campaigns to clearly communicate kind of the business needs, you know, over compensating on the customer service aspect aspect as well. You know, doing those fun karaokes or maybe, you know, take a poll and maybe everyone's a quiet flight, you know, I don't know, whatever it can be and finding ways to upgrade and kind of give back to those loyal customers because as you shared, Melissa, even a 10% loss from those people is a significant cut in revenue. And so, you know, you need to also be thinking long term gain as a brand that was known for kind of being the friend that we could rely on when we needed a quick, cheap flight. If you're not that person, you just become like everybody else and what becomes your point of difference? And that's what they need to focus on.

Sam Palazzolo [36:17 - 37:21]: It's an interesting point. You know, I think the study behind the study is that when they looked at the loyalty program and the loyalty participants and their travel patterns, you know, whether they got did away with baggage fees, whether they did implemented assigned seating, whether they did whatever, I think there was going to be very little atrophy there. So it's not quite the big, big number. And back to your Netflix example, Chino. I would hazard to guess that you didn't switch. You didn't turn it off. You didn't say, Hulu is a better opportunity for me, I'm going. I'm putting my money where Hulu's mouth. This. I would argue that we probably stuck with Netflix because it's the best. Here's the problem Southwest faces, though. It is not the best in a race to the bottom from an industry perspective, where it is basic transportation point A to B. It's a long distance sometimes, but how can I get there the cheapest? I don't know how it is that a Southwest wins that argument.

Melissa Eaton [37:21 - 37:22]: Yep.

Aaron Wolpoff [37:22 - 37:44]: Yeah. All right. So better and more transparent communication, rewarding your loyalists and not leaving them behind, not profiteering to the point where you're gouging your customers, but make. Making good financial decisions that keep you afloat as a company is the, you know, fiscal responsibility. Did Sam, did we fix it? Or at least give Southwest an opportunity to fix it?

Sam Palazzolo [37:44 - 38:30]: I. I think I want to say layoffs, baggage fees, and assigned succeeding. Oh, my. To the Lions, Tigers and Bears wizard of Oz analogy. I argue Southwest just traded its soul for a spreadsheet. The market can cheer today. But customers who remember those love days and who like me, I'm a product of Southwest, I've had their back, and they had my back. I wouldn't be here sitting here today physically if it wasn't for that pilot that day where we almost crashed. I. I would argue Southwest should try and play the long game or they're going to get played. Or as consumers, we need to play a shorter game and not get played. So did we fix it? I don't think so.

Aaron Wolpoff [38:30 - 38:32]: All right. Chino, how about you?

Chino Nnadi [38:32 - 38:53]: I would say yeah, for this one, unless they kind of bring on some of the ideas we had, they have a short window to fix it. And without doing any of that, they become just like everybody else. And unfortunately, they're going to get lost in the background. So they can fix it if they listen. So hopefully someone from Southwest is listening.

Aaron Wolpoff [38:53 - 38:56]: All right, so maybe a fix with an apostrophe.

Melissa Eaton [38:56 - 38:57]: Yes.

Aaron Wolpoff [38:57 - 39:00]: Or an asterisk. I mean, Melissa, how about you?

Melissa Eaton [39:00 - 40:23]: I definitely think that to Chino's point and perspective, it's true, crisis management matters. And so hopefully they will be able to communicate with empathy and with transparency what the needs are and what was behind this and can get a balance of what they need to be profitable. But I do feel like they have that opportunity, the door still open to that. And it doesn't mean that they have to roll it all back. I think that they can still move forward with the changes they want to, but I think that there needs to be some adjustments to those so that the loyalists feel like they're still being taken care of. And, you know, I really appreciate, Sam, your story about Southwest, because I think that also shows the importance of safety, of trust. That, you know, you were just so impressed by the people that helped you get back to where you needed to safely is something that they should really, you know, they should not ignore, that they should use your story to help people understand that, like, there's more to it than, you know, no free bags. There's a lot more to it. And so I think that there's an opportunity for them to craft a new story that will help them get to where they need to get.

Chino Nnadi [40:24 - 41:10]: Yeah, just before we end, because I want to just add one more piece to that. I think Sam's story highlights when exceptional nugget for them. It's the people. Your people can make it. A plane could almost crash, and that is a horrible situation that you experience. We can't make light of that. But the fact that the people were able to guide you through that with the utmost professionalism, care, and building that trust with you is what made the difference. Like, you're on the customer advisory board, having been on the same plane from that same company that crashed. Would it be me? I don't know. But again, it was the people that made the difference. So I think there's one nugget you take away from this Southwest airline. It's that you really need to double down on your people.

Aaron Wolpoff [41:10 - 41:49]: Yeah, I hope they. Hope they hold onto that moving forward, put their people front and center. That does it for us. We've wrapped up another episode of We Fixed it. You're welcome. We've got more episodes underway, including one where you, the listeners, send us the things you wish company companies would do and how you would fix them. We'll discuss your ideas and pressure test them and tell you what we think. We'll call that one, you fixed it. We're welcome. But as always, send us your ideas@wefixeditpod.com. tell your friends, neighbors, and colleagues about our show. Listen and subscribe on Apple Podcasts, Spotify, or wherever you get your favorite podcasts. And we will see you next time. This podcast is produced by Straightforward Media Group. All rights reserved.

Melissa Eaton [41:49 - 41:50]: If you'd like to learn more about.

Sam Palazzolo [41:50 - 42:04]: About how a podcast can help your company establish authority and generate leads, please email us at eric@forwardforwardmg.com or go to straightforwardmg.com for more information.