Businesses need to learn to apologise

Great businesses succeed because of how they make their customers feel. It’s the biggest business lesson I’ve learned in twenty years of running Octopus and it’s refreshingly simple. Make your customers feel cared for and valued and everything else will follow.

Ask any customer, across any industry, which companies they love dealing with and the reason behind their answer will always be the same. Service.

Bizarrely, not many companies seem to understand this. They’re so focused on what they do that how they do it (the values and behaviours of their people) isn’t prioritised. And that’s a mistake.

Over the years, I’ve worked hard to build and maintain a culture where everyone obsesses about the customer. Here are the five most important things I’ve learned during that time:

1. Without the customer there is no business

People working in early-stage companies understand this perfectly. Winning and retaining a customer is everything – they know only too well that without them their business will fail. So nothing is ever too much trouble and the gratitude they feel is entirely genuine.

Contrast this with the huge multi-nationals where their behaviour (and morality) seems to decline as they add more and more customers.

There’s a good rule to remember. Our first customer was a man called Mr Gower. The day he became a customer I called him to say thank you and to explain the kind of business we wanted to build. Today, we have almost two million customers across the Group but I still think that the bar for the thousands of customers who join each day should be set at the same level. Are we making them feel as appreciated and as welcome as we did with Mr Gower?

2. Mean it when you say ‘sorry’

Every person, and every business, will make mistakes. That’s OK. Your employees and your customers all understand this. But it’s the way you react that will define how your customers think about you. 

Here’s a personal experience that’s stuck with me. I recently made an insurance claim where the customer experience was painful. I emailed the person who looks after our account and explained what had happened. Her reply was telling: “I am really sorry you feel you’re not experiencing the best claims journey so far.”

There are two words in the response that suggest the company either doesn’t really care or doesn’t want to admit it’s made a mistake: “you feel”. Without those words, I would accept the apology and move on. But those two words trigger an emotional reaction in me. There’s no accountability and no empathy. 

If you’re going to say sorry, you need to mean it. Don’t use phrases like, “sorry you feel,” or, “sorry, but.” Be genuine and your customers will recognise your good intentions. Real remorse will go a long way, partly because it’s so rare.

3. Would you be friends with your business?

Humanising a business is always a good test of how it treats its customers. Would I be friends with Tesla? Definitely. Especially on a Friday night. Lloyds Bank? Probably not.

A weird thing happens as a business scales; it starts to lose what sets it apart from other companies. It loses its personality. It communicates and acts in a very similar way to everyone else (largely because people working in companies start to worry about what could go wrong, and what would happen to them if it did).

Companies shouldn’t be afraid of being different. It’s why, for example, we sign emails to our Octopus Energy customers with “Love & Power,” rather than “yours sincerely”. “Love & Power” tells you everything you need to know about our brand and the personality of the people behind it.

4. Hire for values, not skills

Great customer service comes down to the actions of every single one of your employees, every single day. So the values of the people you hire are key. You can’t teach empathy or understanding. People either have it or they don’t. So, while someone may be functionally amazing at their job, you shouldn’t hire them if they don’t share your values. How they do things is always just as important as what they do.

We’ve expanded this into how we reward our people at Octopus. We’ve created a nine-box grid measuring both practical performance (what people do) and their behavioural performance (how they do it). The “what” is measured on a scale of 1-3 (1 being the best), and the “how” is measured on a scale of A-C (A being the best). I’d much rather have an A3 than a C1 on the team, because it’s much easier to improve someone’s functional skills than it is to change their behaviour.

5. Total transparency is the only way

The world is now utterly transparent. The walls companies used to build around themselves, to stop customers from seeing in, have been ripped down. Largely because of social media, customers can now see straight through you – not only what you do but also how you do it.

This means there’s no place for companies that say one thing but do another. Businesses that prioritise their own interests (typically profitability) over the interests of the other stakeholders they serve (employees, customers, environment and community) will suffer.

Companies must get on the front foot. They should be open and vulnerable, safe in the knowledge that their employees and their customers will see this behaviour as a strength and not a weakness.

You can read all my blogs on the Octopus website.