Regaining Altitude after the
Valentine’s Day Massacre
of 2007
A Submission to the Arthur W. Page Society Case Study Competition
Agenda
1. JetBlue Takes Off
2. The Perfect Storm
3. JetBlack and Blue
4. Misery Loves Coverage
5. The Redemption Plan
6. Image Restoration Strategies
7. Discussion Questions
JetBlue Takes Off
 JetBlue Airways Launched Operations in
1999
 Improbable Early Success Despite:
 Track Record of Start-Ups Since 1978
 Barriers to Entry for Industry Newcomers
• High Fixed Costs & Volatile Expenses
• Intense Competition
• Industry Sensitivity to Economic Cycles
 September 11, 2001
JetBlue Takes Off
“It is a business whose margins are so
razor thin that a couple of passengers
on each plane can spell the difference
between profit and loss and where a
one-cent rise in the price of jet fuel
can cost the industry an added
$180 million a year."
– Airline Industry Expert Barbara Peterson
JetBlue Takes Off
 Founder/CEO David Neeleman's Vision
 Bringing the "Humanity Back to Air Travel"
• Paperless Ticketing
• Extra Legroom and Wide Leather Seats
• Satellite TV Feeds
• "Customers" not "Passengers"
JetBlue Takes Off
 Operating revenue for 2006 totaled $2.36
billion
 Represented 39% Growth Over 2005
 By 2007 JetBlue Airways:
 Served 52 Domestic and International
Destinations
 Operated More Than 575 Daily Flights
The Perfect Storm
 Valentine's Day Winter Storm in Northeast
U.S.
 Deteriorating Weather Conditions at
JFK Airport
 Gridlock on the Tarmac
 Frozen Ground Equipment
 Delay in Calling Port Authority for Assistance
 Problems with JetBlue Reservations Hotline
 Inaccurate Flight Info on JetBlue Web Site
The Perfect Storm
 Passengers Stranded Inside Planes
Horror Stories
• 9 JetBlue Flights Sat on the Tarmac at
JFK in Excess of 6 Hours
Hero Stories
• Pilots and
Flight Attendants
Get Creative
• The $360 Cab Ride
The Perfect Storm
 According to Passengers Stranded Inside
JetBlue Planes
"This has been one of the worst
experiences of our lives."
"They are right on the edge of
human-rights violations… They have
no contingency plan at all. When
they say no frills, they mean it."
"It was like – what’s the name of that prison
in Vietnam where they held [Senator John]
McCain? The Hanoi Hilton.”
JetBlack and Blue
 Lost Luggage Piles Up
 JetBlue Planes and Flight Crews Out of Place
Throughout the U.S.
 The "Reset" Plan
 Cancellations
 1,200 between February 14-19
 $20 Million in Lost Revenue
 $24 Million in Refunds and Vouchers
JetBlack and Blue
 The Primary Culprits
 Bad Weather
 Flawed
Decision-Making
 Inadequate
Communication
Processes
 Overwhelmed Reservations System
 Lack of Cross-Trained Personnel
Misery Loves Coverage
"Call it the perfect storm, the imperfect storm,
the Valentine’s Day Massacre."
– A JetBlue Vice President
 Media Interest in the
Crisis
 5,000 Phone Inquiries
Over Six Days
 Battling Misperceptions
 Concern on Wall Street
 Congress Comes Calling
The Redemption Plan
"This is going to be a different
company because of this.
It’s going to be expensive.
But what’s more important is to win
back people’s confidence."
– JetBlue Founder and CEO David Neeleman
Image Restoration Strategies
 Shift the Blame to the Weather
 Reduce the Perceived Magnitude of the
Crisis
 Make Sincere and Repeated Apologies
 Compensate Customers Impacted by the
Crisis
 Take Corrective Action
 Neeleman: Let's Issue a "JetBlue Airways
Customer Bill of Rights"
Image Restoration Strategies
 Selected Key Publics
 Customers Impacted by the Crisis
 Unaffected JetBlue Customers
 Employees
 Shareholders
 Government
• Industry Authorities
• Eager Legislators
 Media
Discussion Questions
1. What image restoration strategies should
JetBlue Airways employ to rebuild its
reputation as a customer-centric company?
2. If you were in charge of JetBlue’s external
communication effort, how would you try to
make amends with customers who were
delayed aboard planes or in terminals for
hours?
3. How could JetBlue have better
communicated with its internal stakeholders
across the country on Valentine’s Day and
during the days that followed?
Discussion Questions
4. When addressing the company’s
stakeholders, how much blame for the crisis
would you place on the inclement weather
on Valentine’s Day?
5. What is the best way to publicly explain the
hundreds of additional flight cancellations
that were necessary because of JetBlue’s
decision to “reset” its operations?
Discussion Questions
6. Should the corporate communications team
at JetBlue arrange for CEO David Neeleman
to appear on the national television news
and talk show circuit following the crisis?
What are the potential benefits and risks to
the company’s reputation?
7. What are the financial and reputational risks
of publicly committing to an initiative like
the JetBlue Customer Bill of Rights?
Discussion Questions
8. What concerns might JetBlue’s shareholders
as well as members of its legal and finance
departments have about a proposed JetBlue
Customer Bill of Rights?
9. Could JetBlue ever retract its Customer Bill
of Rights once it is made public?
10.If implemented, how would you market the
JetBlue Customer Bill of Rights to external
and internal stakeholders?