Example of Bad Public Relations

In my marketing class today, my prof posted a video of an example of what could happen when a company ignores good public relations. When Dave Carroll flew United Airlines from Halifax to Chicago to perform a show, his "Taylor Guitar" was damaged when the baggage crew mishandled it. Dave tried wanted United to replace the item but they refused. In response, Dave made this video:

The video went viral and in just one day, it amassed 150,000 views on youtube. The video now has close to 12 millions views. Wikipedia says that United stocke price dropped 10% within 4 days after the videos was posted!!! 

Yes, the airline company did eventually own up to their mistake and gave Carroll money to replace his old guitar, but he just donated it to charity because Taylor Guitars had already given him some 2 guitars plus props to make a second video. United Airlines really screwed up this incident. 

According to my prof, United hired Carroll to fix their public relations, which begs the question, how hard is it really to keep consumers happy? I would think that a simple "respect customer property" or "be nice to customers" statement would suffice. Though, hiring Carroll is itself a PR strategy: it eliminates the leader of the whole incident.