Under the Influence with Terry O'Reilly - S1E20 - Sorry Seems To Be The Smartest Word: When Brands Apologize

Episode Date: May 19, 2012

Over the lifetime of a company, mistakes happen. When those mistakes cause damage, it's appropriate for a brand to apologize. Yet, it rarely happens. This week, we look at the companies that chose to apologize. Hosted on Acast. See acast.com/privacy for more information.

Hi, it's Terry O'Reilly. As you may know, we've been producing a lot of bonus episodes while under the influences on hiatus. They're called the Beatleology Interviews, where I talk to people who knew the Beatles, work with them, love them, and the authors who write about them. Well, the Beatleology Interviews have become a hit, so we are spinning it out to be a standalone podcast series. You've already heard conversations with people like actors Mark Hamill, Malcolm McDowell, and Beatles confidant Astrid Kershaw. But coming up, I talk to May Pang, who dated John Lennon in the mid-70s. I talk to double fantasy guitarist Earl Slick, Apple Records creative director John Kosh. I'll be talking to Jan Hayworth,

who designed the Sgt. Pepper album cover. Very cool. And I'll talk to singer Dion, who is one of only five people still alive who were on the Sgt. Pepper cover. And two of those people were Beatles. The stories they tell are amazing. So thank you for making this series such a success. And please do me a favor, follow the Beatleology interviews on your podcast app. You don't even have to be a huge Beatles fan. You just have to love storytelling. Subscribe now and don't miss a single beat. new year new me season is here and honestly we're already over it enter felix the health care company helping canadians take a different approach to weight loss this year weight loss is more than just diet and exercise it can be about tackling genetics hormones metabolism felix

gets it they connect you with licensed healthcare practitioners online who'll create a personalized treatment plan that pairs your healthy lifestyle with a little help and a little extra support. Start your visit today at felix.ca. That's F-E-L-I-X.ca. From the Under the Influence digital box set, this episode is from Season 1, 2012. You're not you when you're hungry. You're in good hands with us. You're under the influence with Terry O'Reilly. In 2008, comedian Russell Brand was hosting his weekly radio show on the BBC. Russell Brand.

He was scheduled to do an interview with actor Andrew Sachs, who had played Manuel on the famous Fawlty Towers television series. Okay, so I believe, is Andrew Sachs going to be on the phone now? Brand's show was being co-hosted by television and radio personality Jonathan Ross. As the show began, Russell Brand announced they were going to interview Andrew Sachs, but what Andrew doesn't know is, quote, I've slept with his granddaughter. When Brand called Sachs on the phone, Sachs didn't answer,

so Brandon Ross left him four messages. In the first message, as Brand talks about how he and Sachs had once appeared in the same TV series, Ross yells out something obscene. Andrew Sachs. Don't call him Andrew, obscene. Man, uh, Andrew Sachs. Don't call him Manuel, that's really bad. Call him Andrew Sachs. Oh, I apologise. I said Andrew Sachs.

He's an idiot. Look, Andrew Sachs, I've got respect for you and your lineage and progeny. Never let that be questioned. Don't hint. I wasn't hinting. Why did that come across as a hint? Because you know what you're doing. That wasn't a hint.

Now when you were... He's f***'s your granddaughter! In three subsequent phone messages, Brand and Ross continue the conversation about Brand sleeping with Sax's granddaughter. And they sing this song. Andrew Sax, Andrew Sax I said some things I didn't have oughta Like I had sex with the granddaughter the incident

didn't cause waves at first but the next day the mail on Sunday wrote a story about it on their front page saying Brandon Ross could face legal ramifications for the calls three days later the BBC had received 4,700 complaints. Soon, that number had passed 10,000. By now, news of the phone messages had gone international, and even British Prime Minister Gordon Brown called the incident inappropriate and unacceptable. The British telecommunications regulator launched an investigation. Eight days later, the complaints topped 38,000.

The director-general of the BBC then announced that Brand and Ross had been suspended, pending an investigation. He also offered Andrew Sachs and his family a personal apology. Andrew Sachs confirmed he had received the apology as well as written ones from Brand and Ross that same day Russell Brand released this video when on Saturday the 18th of October I made those remarks on Andrew Sachs's answer phone I didn't think that the repercussions would reach the proportions that they have obviously in fact I didn't think about it at all I now acknowledge it was a really really stupid to do, particularly because Andrew Sachs is an actor and comic performer that I very much admire. I don't want to sort of really

try and qualify it in any way, but it's just I was being really silly and got caught up in the spirit of the moment. And it was certainly not my intention to hurt Andrew, a man who i very much admire or to embarrass his granddaughter georgina now i've apologized to andrew sachs and i believe he's graciously accepted my apology i've not had a chance to apologize to georgina yet because i'm a little bit embarrassed and thought i might make it worse to tell the truth and the reason i've not apologized publicly up until now is because I didn't want to be seen to be apologising for the reaction to the situation rather than the situation itself. In the video, Brand also resigns from the BBC. And I take complete and utter responsibility for that. Also, I'd like to say

that whilst I won't be working for the BBC anymore because I think it's best for the BBC best for the people that have been offended brands boss Leslie Douglas also tendered her resignation it appeared that brand was serious about the apology to the BBC and to Andrew Sachs as well as to Sachs granddaughter Georgina Bailey although if you watch his apology video on our website, you might notice a picture of dictator Joseph Stalin hanging strategically on the wall behind Brand.

Read into that what you will. Apologies are delicate acts. They are ignited by problems, they are hard to make, uncomfortable to watch, yet they hold incredible power to heal and to re-establish trust. In the world of marketing, apologies are rare.

Yet there are many times in the lifetime of a brand where it seems appropriate to apologize to customers, whether the problems are big or small we've heard Russell brand apologize but let's see what happens when big brands do you're under the influence it's unusual to hear a corporation apologize in many cases when you do hear an apology of sorts it's because to hear a corporation apologize in many cases when you do hear an apology of sorts it's because the company has been forced to but I believe apologizing is actually good for business pretending an accident didn't happen or fixing the problem and just carrying on as if nothing happened may

be good for business in the short term, but karma always, always catches up to companies in the long run. Becky Quick, a co-anchor on CNBC's Squawk Box, says the strength of the global economy depends on people's willingness to trust institutions and institutions' ability to trust one another. When problems crop up in business, a sincere, timely apology is essential in restoring that trust. One of the main reasons corporations rarely ask for forgiveness is because many CEOs fear an apology may create legal liabilities,

that a plaintiff's lawyer will gleefully use the apology as leverage. Depending on the jurisdiction, that is not necessarily the case. In some Australian states, saying I'm sorry for an action is not considered at all an admission of legal liability.

In California and 20 other states, statements or gestures expressing sympathy relating to pain, suffering or death are inadmissible as evidence of an admission of liability in a civil action. British Columbia has apology legislation, as does Saskatchewan and Manitoba. Ontario has the Apology Act of 2009 that states, While an apology is powerful, it must be born of three ingredients. It has to be sincere,

it has to be timely, and above sincere, it has to be timely, and above all, it has to be done willingly. And the public's ability to judge these three elements is acute. Last year, Johnson & Johnson found themselves with a customer loyalty problem. It all began when a particular brand of tampon in the OB line was discontinued in North America in 2010. At the same time, Johnson & Johnson was having widespread supply chain problems with OB that led to empty shelves. People thought the whole OB line was being discontinued. Suddenly, loyal customers started panicking and buying up all the OB product they could find. Prices on eBay even went as high as $100. A consumer petition was started demanding that the product be brought back,

and a Facebook group called for a boycott of all Johnson & Johnson products. A spokesperson for the company said they clearly, quote, underestimated the degree of loyalty for that particular OB product. Then, Johnson & Johnson did a rare thing. They apologized to their customers, but they did it in a unique way. Working with their advertising agency, Low Roche, they created a musical apology. When customers logged on to obtampons.ca slash apology and typed in their first name, a greeting card popped up that said, we're really, really, really, really, really, really, really, really, really, really sorry.

Really. Then, a video appeared of a good-looking guy sitting at a white piano outside by the sea singing a personal apology just for you it was incredibly well done I'll type in my wife's name to demonstrate de BB ie here's what Debbie heard starting with a camera move over the sheet music sitting on the piano, which actually says, a tender song for Debbie. Debbie, I know we went away and let you down. Debbie. Believe me when I say.

We want to turn this thing around. Calling out your name. And calling out your name again In case you didn't hear it the first time Debbie, didn't mean to make you cry Didn't want to say goodbye And it's so sorry Next, the singer reveals a tattoo on his arm that says, Debbie.

He releases doves that spell out Debbie in the sky, alongside a hot air balloon that says, you guessed it, Debbie. Her name is spelled in rose petals on the beach and is even written in skywriting. Then, as the song comes to a close, Johnson & Johnson holds out an olive branch.

Two doves hold a sign that says, We owe you one. Click here for your OB coupon. The apology was sent out to over 65,000 loyal OB users, a list that covered about a thousand distinct names. The response was overwhelmingly positive from women. They liked that it was funny and that it played with all the cliches of a power ballad.

And because Johnson & Johnson used online technology, they made it engaging without resorting to a hard-sell commercial. Within the first 10 days alone in Canada, it had garnered almost 600,000 unique views. As the J&J spokesperson said, we're hoping that by sending people this personal apology they'll forgive us the company said the product would be back on shelves by mid 2012 and promised to keep customers updated it was an apology that turned heads stopped a potential loss of customers J&J showed their customers they were listening and it even made them smile. Then there are incidents that are no laughing matter. And we'll be right back.

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Find your push. Find your power. Peloton. Visit Peloton at onepeloton.ca. If you're enjoying this episode, why not dip into our archives? Available wherever you download your pods. Go to terryoreilly.ca for a master episode list. slices up his nose before putting it on a sandwich and sneezing on a pizza while a female employee narrates two dominoes employees facing charges tonight and this is why a shocking video that hit the web it shows them allegedly messing with your food they have turned themselves in

and tonight we've learned they will be charged the video attracted over a million views in just a few days. The two employees were immediately fired and eventually arrested. Even though they claimed it was just a prank and the food was never delivered, it was a PR disaster for Domino's. A spokesman said they had been blindsided by two idiots with a video camera and that people who had been loyal customers for 10, 15, and 20 years were now second-guessing their relationship with Domino's. The company's reputation was heavily damaged overnight. It was serious enough that the president of Domino's offered an apology in a video.

Hello, I'm Patrick Doyle, president of Domino's USA. Recently, we discovered a video of two Domino's team members who thought that their acts would be a funny YouTube hoax. We sincerely apologize for this incident. We thank members of the online community who quickly alerted us and allowed us to take immediate action. Although the individuals in question claim it's a hoax, we are taking this incredibly seriously. This was an isolated incident in Conover, North Carolina. The two team members have been dismissed, and there are felony warrants out for their arrest.

The store has been shut down and sanitized from top to bottom. There is nothing more important or sacred to us than our customers' trust. We're reexamining all of our hiring practices to make sure that people like this don't make it into our stores. We have auditors across the country in our stores every day of the week, making sure that our stores are as clean as they can possibly be and that we're delivering high quality food to our customers day in and day out.

The independent owner of that store is reeling from the damage that this has caused, and it's not a surprise that this has caused a lot of damage to our brand. It sickens me that the actions of two individuals could impact our great system, where 125,000 men and women work for local business owners around the U.S. and more than 60 countries around the world. We take tremendous pride in crafting delicious food that they deliver to you every day. There are so many people who have come forward with messages of support for us, and we want to thank you for hanging in there with us as we work to regain your trust. Thank you.

A research company did an interesting analysis of this apology video. They studied the reaction of 243 people to test the believability of the Domino's president. As he begins to outline the prank and how seriously he is taking the issue, the score shoots to the top of the believability scale. It dips as he says it was an isolated incident, but when he says the two employees have been dismissed and will be arrested, the score begins to go upward again.

When the president begins to talk about the Domino's policy for cleanliness and how they have auditors visiting stores on a daily basis to ensure clean premises, his score drops considerably. When he goes on to say the owner of that particular franchise is reeling and that they acknowledge the incident has caused damage to their brand, his believability score goes up. Then, when he speaks from the heart, saying it sickened him that the actions of two individuals could impact their company,

his believability score goes through the roof. You can watch this second-by-second analysis of his apology on our website. It's interesting that the overriding impulse by presidents and CEOs to talk policy and mission statements, even when they feel the

information is necessary to calm the waters, actually chips away at their credibility. Yet, when the domino's president spoke from the heart, when there was emotion in the apology, people responded with maximum believability scores. Analyst Tom Searcy believes that apologies are woefully underused in corporations,

but he believes in them and offers these insights when it's time to apologize. 1. Separate the apology from the explanation. The apology has to stand on its own in order to be processed by customers. If combined, they will only hear the excuses, not the apology. The explanation can come after the apology has been accepted. 2. Own more than your portion. When problems happen, there is a tendency to assign portions of guilt. We're 40% responsible, they're 60%, for example.

It's better to own the entire problem in an apology. Don't break guilt up into fractions. And three, focus on what happens next. Outline immediate next steps, show leadership. Action accelerates solutions. Searcy believes apologies take the energy out of conflicts. They also separate time into past and future, problem and resolution.

Above all, those two little words, we're sorry, can go a long way in the healing process. Recently, the Toronto Maple Leafs didn't make the playoffs. Again. So they printed a full-page apology in the newspaper. The apology, an open letter to fans signed by the club's chairman, said, in part,

We have fallen short of everyone's expectations and for that we are sorry. We take full responsibility for how this team performs on the ice and we make no excuses. The Leafs haven't won

a Stanley Cup since 1967, tied with two other teams for the longest drought in hockey history. The team hasn't made the playoffs in seven seasons. It was the first time the team management had ever formally apologized to the fans. It appeared the apology was a failure. First, it was done in print, not in person. There was no face time to judge conviction or sincerity. A fan said it was as sincere

as breaking up with a girlfriend in a text message. As communications specialist Michael France wrote, corporate apologies are evaluated according to human metrics, not financial ones. Does the company seem sincere? Will it fix the problem? Is the reason to believe things will change? The Leafs haven't won for a long time. Ticket and beer prices haven't gone down. 1967 was a long time ago. The press and the public just didn't seem to buy it. life goes. New father, new routines, new locations. What matters is that you have something there to

adapt with you, whether you need a challenge or rest. And Peloton has everything you need, whenever you need it. Find your push. Find your power. Peloton. Visit Peloton at onepeloton.ca. Good evening. That listeriosis outbreak is actually worse tonight than we first thought. Officials say 12 people have died and more than 50 cases are under investigation across the country. In 2008, it was confirmed that meat products from a maple leaf foods plant had tested positive for listeria. CEO Michael McCain ordered a recall of all 220 packaged meats from that plant. As details of the contaminated food became more and more serious, McCain wanted to reassure the public that Maple Leaf Foods was concerned for their health and that it was responding

with every resource it had. My name is Michael McCain. As you may know, Listeria was found in some of our products. Even though Listeria is a bacteria commonly found in many foods and in the environment, we work diligently to eliminate it. When Listeria was discovered in the product, we launched immediate recalls to get it off the shelf. Then we shut the plant down. In this video, McCain outlined his company's response to the outbreak. But it also contained a very important sentence, one that can make all the difference to the public.

Yet, as Elton John once said, it contained the hardest word. But our best efforts failed, and we are deeply sorry. It has to be said that absolutely no apology can make up for a tragedy where people die. Nothing can. But Maple Leaf Foods didn't avoid blame or point fingers, they didn't keep silent, and they didn't maintain a low profile. In other words, CEO McCain assumed full responsibility. In one of my favorite apology stories, a UK beverage company called Innocent Drinks

sent out a coupon for Easter. Except the wrong barcode was attached, making it impossible to redeem. So Innocent sent out an immediate apology to all its customers, along with a coupon that worked. They concluded their apology by suggesting that customers

could keep the old coupon as quote, a memento of our stupidity. In the end, an apology can mean more to customers than financial remuneration. It also speaks to the values of the company and how much you really mean to a company

as a customer is ultimately revealed. As writer Michael Frantz says, an apology lets a company write an ending to a bad story. A reputation can take decades to build and a day to lose. Regaining credibility is a painful, delicate journey. But if people have genuine relationships with brands, then like any relationship in life, an occasional apology is not inappropriate. Trendwatching.com published an interesting article recently saying when companies demonstrate a human

side, when they can show humility, empathy, and maybe even a little humor, customers become more loyal. Put another way, a company can have flaws and still be awesome. Trend-watching calls it being flawsome. If history has taught us anything, it's that great humans have great flaws. The same goes for great companies. And when those flaws do damage, it's only good business to apologize. The Toronto Maple Leafs tried, but the believability was a little short-handed.

On the other hand, OB Tampons won back its loyal customer base. Domino's Pizza restored faith in its product. And Maple Leaf Foods probably saved their company. So, with all due respect to Sir Elton John, sorry seems to be the smartest word when you're under the influence. I'm Terry O'Reilly.

Just calling to apologize for the last message we left, asking you to sign all those items for our celebrity charity auction. We thought you were Terry O'Reilly, the hockey player. So please don't sign anything. We only need people who are well-known. Again, we apologize. Thank you. Under the Influence was produced by Pirate Toronto and New York. people who are well known. Again, we apologize. Thank you.