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How ‘Non-Apologies’ can put your Business at risk

How ‘Non-Apologies’ can put your Business at risk

Harshni SreedharHarshni Sreedhar | May 10, 2016

Apology (Noun)- a written or spoken expression of one’s regret, remorse, or sorrow for having insulted, failed, injured, or wronged another.

That’s the Merriam Webster definition for the word ‘Apology’. Having its etymology in ancient Greek, the word is meant to convey contrition and regret.

Now, you might be wondering what relevance does this bear for a consumer-facing business. Let me begin by stating a simple fact: we, as humans, are prone to making mistakes, something that is perfectly normal. This holds true even while running a business irrespective of the scale of your operations. Mistakes are often a by-product of growth but when they affect a customer or an employee in a negative way, it’s required that you step up, take ownership of the situation and apologize with all the sincerity you can muster.

While an apology from your end is considered default nowadays, the manner in which you say it will go on to determine the outcome of the situation. Poorly and hastily-crafted apologies tend to project a careless brand image, bringing down retention rates as customers come to know that the brand doesn’t truly care for them.

Here’s a valuable insight:

Customers do have empathy. But that doesn’t mean you can take them for granted. They can easily find out whether your apology is template-driven or straight from the bottom of your heart. Here, we take a look at 3 separate instances where Brands, in the name of finding an amicable ending, got their apologies horribly wrong.

1. REDDIT – Drop the Corporate Lingo!

Reddit’s former CEO, Ellen Pao, apologized for the sudden and abrupt firing of a popular Reddit employee – a decision that resulted in a number of volunteer moderators shutting down large portions of the site.

In an exclusive Reddit post, Pao said:

We screwed up. Not just on July 2nd, but also over the past several years. We haven’t communicated well, and we have surprised moderators and the community with big changes.

How did Reddit get this wrong? Firstly, this apology seems to be copied off a template, and written in a Press Release (PR) style. Moreover, they shied away from the core issue which was the firing of the employee and tried to include too many things in one supposedly very specific apology letter. Never sound this corporate while issuing a public apology. Remember that the situation is already delicate. Don’t exacerbate it further by making your sorry come across as stoic. These are the little things that rub your customers the wrong way for they expect you to own up to the issue at hand.

2. SONY – Apologize on Time

Hackers infiltrated the Sony PlayStations Network and stole customer data from more than 77 million users. A few days later, they struck again, hacking a 2007 database that contained customer information including names, addresses, passwords, credit card information, etc.

Surprisingly enough, it took Sony a week to go public to inform customers that their servers had been hacked and critical consumer information accessed. Moreover, it took them 26 days to restore their services and offer customers a welcome-back program. The apology video can be seen here.

How did Sony get this wrong? Irrespective of the magnitude of your slip up, it’s only human to not delay the timing of your apology. Your customers depend on you for their needs and therefore, they should be amongst the first to be informed about any slip up. In Sony’s case of a high-risk event, it wasn’t disclosed for an alarmingly long duration – one week – and customers found that unacceptable, given the amount of trust they placed in the Brand by providing their personal information.

3. Airbnb – Sounding Cool is Uncool

San Francisco residents were furious at Airbnb for its condescending ad campaign which the company used to convey the fact that they were paying taxes they had once evaded.

When the residents reacted, the company replied saying, “We’re sorry you didn’t get it”.

A company spokesperson later had to clarify the above statement:

The intent was to show the hotel tax contribution from our hosts and guests, which is roughly $1 million per month. It was the wrong tone, and we apologize to anyone who was offended. These ads are being taken down immediately.

How did AirBnB get this wrong? Made a mistake? Fine! Don’t try to be flippant about it. Acting smart or quirky will not work always. At times when you got to apologize, you got to apologize. Telling people that you are sorry can be said only in one way – the sincere and honest way. Customers will forgive mistakes, but how you apologize for those mistakes is of utmost importance.

Now, if you’re wondering how to get your apology right, here’s a classic example! – The largest online retailer in the world. In the summer of 2009, Amazon remotely deleted George Orwell’s ‘1984’ out of the Kindle bookshelves of thousands of its users. This is what Amazon CEO Jeff Bezos had to say about the incident,

The act was stupid, thoughtless, and painfully out of line with Amazon’s principles. We deserve the criticism we’ve received. We will use the scar tissue from this painful mistake to help make better decisions going forward, ones that match our mission.

The apology felt sincere, highly concise and well-articulated, and also pretty courageously said. This whole incident is now water under the bridge! When a brand makes a mistake, there is a magic phrase that is a get out jail free-card – ‘Mea Culpa’, my fault. If you want acquittal in the jury of your customers, your defense recipe must involve the ingredients of acceptance, contrition and penance.

No blame games. Apologize and become the owner of the issue at hand. A brand image is built with high intricacy, and when there’s a low point along the journey, how you handle the situation determines everything – right from customer acquisition to customer retention rates.

How is my Business at Risk here?

Let’s take a quick look at some relevant statistics first.

1. It costs 5 times more to acquire new customers than it does to retain current ones. (source)
2. Reducing customer churn by 5% can increase profits by 25-125%. (source)

These stats go to prove one thing – customer churn can kill your business. And in the event of a slip-up from your side, there’s every chance that customers will abandon you for greener pastures (your competition!). Owning up to the mistake and apologizing sincerely is the only way you can prevent it from getting worse. Like I said before, customers do have empathy. And they will empathize with your mistakes provided your apology deserves it.

GET UP, SHOW UP, OWN UP’.. and use Cloudcherry for it!