Airline Reputation Study Finds Singapore Airlines, Southwest Airlines Soaring.

Business Editors/Travel & Airline Writers

ROCHESTER, NY--(BUSINESS WIRE)--April 27, 2000

Reputation Institute / Harris Interactive Study Shows

Domestic Airline Reputations Lag Those of International Carriers

According to a new study of airline reputations, Southwest Airlines, Delta Air Lines, Singapore Airlines and Deutsche Lufthansa are soaring above the competition.

By measuring the attitudes of over 20,000 consumers, the Airline Reputation Quotient (RQ) study rates domestic and foreign airlines on issues ranging from safety and trust to customer service and food. The RQ study was designed and conducted by the Reputation Institute, a private research organization dedicated to advancing knowledge about corporate reputations, and Harris Interactive, a global Internet research firm.

"An airline's reputation is an integral part of its overall performance," said Charles Fombrun, Executive Director of the Reputation Institute and Professor of Management at the Stern School of Business (NYU). "The RQ is a powerful way to quantify public perceptions of an airline's performance. Understanding public perceptions of airlines should be the first step in airline efforts to improve their service, maintain customer loyalty, and compete in the marketplace."

Using Harris Interactive's database of online respondents, 20,867 U.S. adults were asked to rate 25 airlines on over 20 items. According to their RQs, the top-ranked domestic and foreign airlines are:

           Domestic Airlines                      RQ

     1     Southwest Airlines                     75.0
     2     Delta Airlines                         70.0
     3     AMR Corp. (American)                   69.5
     4     UAL Corp. (United)                     67.2
     5     Continental Airlines                   66.0
     6     Northwest Airlines                     65.9
     7     America West Holdings                  64.8
     8     Trans World Airlines (TWA)             63.3
     9     US Airways Group                       62.9
    10     Alaska Air Group                       61.6

             Foreign Airlines                         RQ

       1     Singapore Airlines                       80.3
       2     Deutsche Lufthansa                       74.7
       3     Scandinavian Airlines System             74.4
       4     KLM Royal Dutch Airlines                 74.1
       5     Qantas Airways Limited                   73.1
       6     British Airways                          72.5
       7     Virgin Atlantic Airways                  72.3
       8     SAirGroup (SwissAir)                     72.0
       9     Japan Airlines Company (JAL)             69.6
      10     Air Canada                               68.8
      11     All Nippon Airways Co.                   67.6
      12     Societe Air France                       65.9
      13     Alitalia                                 64.5
      14     Iberia                                   60.3
      15     Korean Air Lines                         54.5

"The RQ study found that foreign-based airlines clearly enjoy a better reputation than most domestic airlines," said Gordon S. Black, Chairman and CEO of Harris Interactive. "Of the fifteen airlines with the highest overall RQ ratings, eleven are international carriers. Domestic carriers also trailed their foreign counterparts in measures of customer service, food, and safety."

Statistical analysis of the data shows that consumers rate airlines primarily on their perceptions of each airline's service quality, reliability, management strength, workplace, and growth prospects. Airlines that are successful at conveying these traits are more likely to be liked, trusted, and admired by the public.

The analysis also shows that consumers react negatively to airlines that appear strategic and opportunistic. "Many consumers perceive domestic airlines as aggressive companies with only bottom-line interests," says Joy Sever, the RQ practice director at Harris Interactive. "It clearly lowers their RQs."

Other notable findings from the Airline RQ Study include:

-- Customer Service: Singapore Airlines and Southwest Airlines earned high marks for their customer service, followed by Delta Air Lines and Lufthansa.

-- Business vs. Leisure Travelers: Business travelers gave Southwest Airlines and United Airlines the highest marks, while leisure travelers gave the highest ratings to Southwest and Delta Air Lines among domestic airlines.

-- Food Quality: Singapore Airlines tops airlines in food quality, and only two domestic carriers cracked the top 10 (Delta Air Lines, #7, and American Airlines, #10).

-- Safety: Qantas Airways, Singapore Airlines, and Southwest Airlines were perceived as the safest airlines. 61% of respondents say they take safety into account "a lot" when choosing an airline.

-- Financial Performance: General investors gave Japan Airlines (JAL) and KLM top ratings among international carriers, and rated Southwest Airlines and American Airlines tops among domestic carriers.

-- Crisis Handling: Perhaps as a result of efforts following a recent crash, Alaska Airlines was rated the airline most "trusted to do the right thing if faced with a crisis."

Airline Reputation Quotient (RQ) Methodology

The Airline RQ was conducted online using Harris Interactive's database of over 6 million cooperative respondents. A total of 20,867 U.S. adults (18+ years) were interviewed March 3, 2000 through March 10, 2000. Respondents were asked their familiarity with airlines from a prompted list of 25 companies including the 10 U.S. and 15 foreign largest revenue-generating airlines. Respondents were then randomly assigned to rate two airlines from among those with which they were at least "somewhat" familiar. Final results were weighted to be representative of the U.S. adult population.

RQ scores were calculated for each airline based on respondents' ratings (using 7-point scales) on 20 individual items classified into six key dimensions:

-- Emotional Appeal: How much the company is liked, admired, and respected.

-- Products & Services: Perceptions of the quality, innovation, value, and reliability of the company's products & services.

-- Financial Performance: Perceptions of the company's competitiveness, profitability, growth prospects, and risk.

-- Vision & Leadership: How much the company demonstrates a clear vision, strong leadership, and an ability to recognize and capitalize on market opportunities.

-- Workplace Environment: Perceptions of how well the company is managed, how it is to work for, and the quality of its employees.

-- Social Responsibility: Perceptions of the company as having high standards in its dealings with people, with good causes, and with the environment.

The Airline RQ is the latest in a series of Reputation Quotient studies that are being conducted by the Reputation Institute and Harris Interactive. Previous studies include the "RQ Digital 40", which surveyed the reputations of America's leading digital companies, and the "RQ Gold," a survey of the public that identified the 30 best-regarded companies in America.

About The Reputation Institute:

The Reputation Institute is a private research organization whose core purpose is to build thought leadership about corporate reputations, their management, measures, and valuation -- under the direction of Charles Fombrun, Professor of Management at the Leonard N. Stern School of Business of New York University. For more information on the Reputation Institute, visit www.reputationinstitute.com.

About Harris Interactive:

Harris Interactive (Nasdaq: HPOL), a leading global market research firm, uses Internet-based and traditional methodologies to provide its clients with information about the views, experiences, behaviors and attitudes of people worldwide. Known for its Harris Poll, Harris Interactive has over 40 years experience in providing its clients with market research and polling services including custom, multi-client and service bureau research, as well as customer relationship management services. Through its U.S. and Global Network offices, Harris Interactive conducts research in over 85 different countries in more than 30 different languages. Harris Interactive uses its proprietary technology to survey its database of more than 6.2 million online panelists. For more information about Harris Interactive, please visit our web site at www.harrisinteractive.com.

To reach Charles Fombrun or Joy Sever, please contact Dan Hucko at Harris Interactive.