Empathetic leadership - how business leaders can build trust online
Empathy is the ability to understand another person’s experience, perspective, and feelings. Empathetic leadership in the past may have been seen as an oxymoron. Leaders were strong, resolute, unflinching. But the truth is, you cannot effectively lead someone if you don’t understand them.
Leaders like Jacinda Arden, the Prime Minister of New Zealand, are proving that empathetic leadership works. Her recent re-election (a record-breaking landslide) is a testament to this, with citizens feeling like, through the many crises of 2020, she has stood with them. Her consistent approach to protecting lives and livelihoods is a good example of empathy in-action. She has created a high level of trust and confidence - exactly the style of leadership needed in a crisis.
Empathy in business
Business leaders too are recognizing the importance of empathetic leadership, not only with their employees but with their customers. Organizations are building this same trust and confidence in their customers by reorienting their customer experience around empathy and care. Moving beyond empty slogans and mission statements, and beginning to cultivate lasting relationships with their customers - which brings returns in the long run.
The business case for empathetic leadership is clear. 63% of customers prefer to buy from brands with values that reflect their own and will avoid brands that don’t. The most empathetic companies (as ranked by the Harvard Business Review in 2016) increased their financial values more than twice as much as the bottom 100.
Online communities and empathetic leadership
To demonstrate empathy with customers, partners, and beyond, organizations crucially need to connect with customers and wider network. As social media becomes saturated and we learn more about how the companies that run them are operating, it is clear that trusted brands must now own their online communities, and stop borrowing space from social giants.
And this in itself is empathetic leadership - it will take leading brands to take this step, and to bring together their customers and prospects together in an owned space. A single place where people know that they can come, connect with a brand, and join in the conversation.
The pandemic has accelerated digital transformation forward several years, and we are open to new technologies, and craving a way to connect - free of ads, algorithms, and ‘surveillance capitalism’. Now is an opportune time, therefore, to build a trustworthy digital space that lays the foundations for your empathetic leadership efforts.
Therefore, with all this in mind, here are 8 ways to lead with empathy online.
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8 ways to create empathy with your customers
During a crisis, leading from the head simply doesn’t cut it. Leaders need to be in amongst the weeds, engaging in conversations with frontline workers and, crucially, listening to their customers. You need to pinpoint their wants, needs, and challenges (instead of assuming what these are) and then look at how your organization can help.
McDonald’s, for example, recently switched to paper straws in all of its UK stores in response to rising customer concerns about the climate crisis. A customer-led campaign attracted over half a million signatures, causing McDonald’s’ leadership to take notice and commit to ditching 1.8 million plastic straws a day.
2. Present the human side of a business
We like doing business with humans, especially during a time when human-to-human interaction is somewhat limited. By showing the faces, names, and lives of your leadership team, your customers are far more likely to forge an emotional connection with your brand instead of a faceless one. Take Tesla and Elon Musk. Although the CEO has been known to mis-step in the past, he is front and center to the Tesla brand. The result? Tesla consistently tops customer satisfaction and ‘most loved car brand’ lists globally.
3. Engage in meaningful interactions
Engagement metrics are great, but meaningful conversations around the topics that really matter to your customers are what will move the needle and begin to build trust. Unfortunately, many brands today are failing to have meaningful interactions with customers. Customers wouldn’t care if three out of four brands disappeared, simply replacing them with alternative product and service providers.
What does resonate? Today’s consumers have value drivers that extend beyond price, quality, or convenience. They also look at the social impact of brands, how it helps their health and wellbeing, and the safety and experience of interacting with a brand.
4. Demonstrate your expertise
A crucial step to building trust involves demonstrating your authority in your subject matter. In the fake news era, people are looking for accurate, expert insight into society’s most pressing matters. This comes back to number 2 - put your experts front and center for all to see and interact with. Add value to their daily lives with your knowledge and insights.
Personalizing your interactions is essentially telling a customer that they matter. We’re constantly being bombarded with marketing messages from brands and something that’s authentic and personalized will really cut through the noise. 84% of consumers say being treated like a person, not a number, is very important to winning their business. 70% say that it influences their brand loyalty.
6. Communicate your decisions
Transparency is key to building trust - having open communication with customers and employees will help them understand why you’ve made certain decisions and vice versa. Involve your stakeholders in your decision making (even more so for difficult decisions). Go on video, or better still, host a live video conference and field questions, particularly if your company is going through more significant changes.
Returning to the Jacinda Ardern example, this is exactly the approach she took when New Zealand was entering lockdown. She hosted several Facebook Live chats that were informal and informative.
Again, this tactic will pay off with greater customer spend and loyalty. Two-thirds of consumers will pay more to buy from a transparent company and 94% rank this as the greatest factor in their brand loyalty.
7. Be accessible
Linking closely with your open communication and transparency is your perceived accessibility. People need to feel like you’re approachable, with an open-door policy for every customer and employee to voice their ideas and concerns. The good thing about this is it gives you a new perspective on your current situation. You can get insights at scale from your customers, on-the-ground employees, and wider stakeholders.
8. Demonstrate your care through company values
One of the clearest ways to demonstrate empathy is through your company values, which become the guiding force for all other decision-making (including recruitment, operations, marketing, and sales). Sticking to your values during a crisis is a powerful trust builder. Giving back to your community will strengthen the trust your customers have in you, as long as you show them what you’re doing and why (because of your values). Even better, invite them to join you.
U.S fast-food chain Portillo’s Hot Dogs stuck to its values during the global lockdown (taking a 20% drop in revenue initially as a result). As CEO Michael Osanloo explained, "Our core values are family, greatness, energy, and fun, and those concepts have guided everything that we've done as an organization.”
When stores in some markets weren’t required to close for dine-in, the company chose to close them anyway as it was the "the right thing to do" based on their values. Leaning on the company core values is a key success factor for Osanloo - "If you're an organization that lacks a 'true north' in values, you don't know exactly what your goals are, and that's going to hurt you."
What Portillo’s lost in short-term profit, it’s gained back in customer loyalty, trust, and brand reputation - the company’s stance has been positively covered across the media.
The decisions you make today will affect how your company is seen for years to come. Prioritizing empathy will foster trust in your customers and therefore increase loyalty and lifetime value. If there is one thing to take away from 2020, that might be it.