By Alan Graner
The art of the corporate apology has been well documented in books and online.
In many respects, apologizing is easy. You say sorry, weather your 15 minutes of ill fame, and move on.
Unfortunately “sorry” isn’t enough. To be effective, “sorry” must be a verb, not a noun. Here are a few examples of some companies who did apologies right.
Incident: When Netflix began streaming video, Reed Hastings decided to split his company in two: DVD delivery and online video streaming. Each had its own website and billing procedures. And, instead of paying just $9.99/month for both, customers now had to pay $7.99/month for each. Customers hated the idea. As a result, Netflix lost 800,000 members in one quarter alone. Hastings admitted he blew it and apologized.
Action: He scrapped the two-business model and offered everything at one website with one billing system. Since then the company has grown internationally, with both its stock price and membership numbers reaching record levels.
Incident: During the Cola Wars of the 1980s, Pepsi launched its Pepsi Challenge—a series of public blind taste tests. Time after time the sweeter tasting Pepsi won…and its market share grew. Coca-Cola management decided to fight back by reformulating Coke for the first time in 99 years. In 1985, after thousands of taste tests, management replaced classic Coke with New Coke. It was a dud. Hundreds of thousands of angry customers called to complain. Coke had alienated its base and watched market share erode further. Coca-Cola management quickly realized the enormity of its blunder and apologized to its customers.
Action: New Coke was replaced with the old formula. Sales actually increased. Not only does Coke still reign as the world leader, it is considered the most well-known and one of the most valuable bands in the world.
Incident: During the 2017 Academy Awards PwC was responsible for the greatest epic fails in Oscar history. The final award—Best Picture—was awarded to “La La Land.” A billion viewers worldwide watched the stage dissolve into chaos as one of the PwC accountants ran up and announced they had given the presenters the wrong envelope. The real winner was “Moonlight.” PwC took full responsibility for the fiasco and apologized to the Academy, the producers of the two movies, the presenters and the public. Twice.
Action: PwC immediately banished the two accountants responsible for the mix-up from future Oscar presentations. Working with the Academy of Motion Picture Arts and Science, the company instituted new protocols to ensure such an embarrassment never again occurred. These included greater oversight, redundancy safeguards and two rehearsals to eliminate any future mistakes.
Incident: On May 12, 2015, an Amtrak train traveling from Washington, D.C. to New York city hit a 50 mph curve at 102 mph and derailed. There were eight fatalities and over 200 injuries. The National Transportation Safety Board (NTSB) declared the accident could have been prevented by a computerized speed-limiting system known as positive train control, which was used elsewhere in the Northeast Corridor but not at the crash site. President and CEO Joe Boardman issued a heartfelt apology and promised a full investigation to eliminate future tragedies.
Action: Over the next two years Amtrak installed inward-facing cameras in its locomotives to record engineer behavior before accidents occurred. It also installed the ACSES positive train control system on the entire Northeast Corridor between Washington, D.C. and Boston.
Compare these actions with companies that weasel out of accepting any responsibility for bad performance or place the blame on anyone but themselves.
Which would you rather do business with?
Alan Graner is Chief Creative Officer at Daly-Swartz Public Relations, an Orange County, CA business public relations and marketing content firm. For content that makes you stand out from the crowd, email Jeffrey Swartz at email@example.com. Or visit www.dsprel.com.