Metro Bank is the U.K.’s first high street retail bank in more than a century. CEO Craig Donaldson, named the ‘Most People-Focused CEO of the Year’ and ‘Most Highly Rated UK CEO’, shares how Metro Bank is creating fans by promising a lot and delivering even more.
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When we started the Outside In podcast, our mission was to speak to – and learn from – the companies, leaders, and executives that are making real progress building customers into the way they work, into their culture, and into the customer experience itself. Craig Donaldson, CEO of Metro Bank, is just the type of person I had in mind.
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If you live outside of the U.K., you might not know Metro Bank. Founded by Vernon Hill, former chairman and president of Commerce Bank in the U.S., Metro Bank launched in July 2010 and is the U.K.’s first new high street retail bank in more than 150 years. Since raising £15 million in 2008-2009 – at the peak of the global financial crisis – it has grown to being worth about £3.2 billion today and serves more than one million customers (and counting).
During my conversation with Donaldson, I learned so much about what makes a customer-inspired company like Metro Bank so successful, and how the CEO of any company – not just a bank – should lead. Donaldson has earned a lot of recognition and praise; he was named the ‘Most People-Focused CEO of the Year’ and ‘Most Highly Rated UK CEO’ by the website Glassdoor.
Below are eight lessons I took away from our conversation.
Fan bases are the result of brand experiences, not advertising
Last year, Metro Bank only spent £60,000 on advertising. At the same time, it doubled its customers. Donaldson insists that fans are created organically by investing in the experiences and relationships people want to have, rather than trying to persuade them through ads. “Fans tell their friends, family, and colleagues that they should bank with you. They then join you and become customers. It’s then our job to surprise and delight those customers and create more fans.”
Stop following all the stupid rules your competition follows. Then deliver even more.
In a recent interview with Forbes, I used Metro Bank as an example of what all companies can do to “promise a lot and deliver even more.” That’s because Metro Bank doesn’t just fix what’s broken with the customer experience; it uses it as an opportunity to delight customers and create new “fans.” For example, the bank is known for the Magic Money Machine, a free coin sorting and counting machine with fun digital graphics that anyone can use. Guess the amount within one pound, and you win a prize. It’s a great way to attract new customers, and it makes going to the bank fun for kids and parents. “Most banks refuse to take loose coins. We say, ‘Of course we’ll take them. That’s what we do. We’re a bank,’” says Donaldson.
Also, dogs are welcome inside every store. (“We’ve got marble floors, so if there’s an accident it doesn’t matter.”) And, every store is open seven days a week, opening 10 minutes early and closing 10 minutes late each day, which can save customers who are running late the hassle of having to come back the next day.
Improve the brand experience, and the customers and sales will follow
“Profit should be an output of good inputs, and if you just focus on the profit then you forget the value you need to add to the customer,” says Donaldson. That’s why sales targets don’t exist at Metro Bank. Instead, employees have brand targets. They are incentivized and measured based on three brand experience categories: Net Promoter Score, mystery (or, as Donaldson calls it, “magic”) shopping, and customer complaint handling. People always know when they’re being sold to, Donaldson says. That can be a big turn-off. But if you focus on making the brand experience the best it can be, “that’s how you create fans.”
Always put culture at the top of your long-term strategy
Culture is palpable; when it’s strong and distinct, employees, customers, even outsiders instantly feel it. But as a company grows, culture can erode. People can feel that, too. “The one strategic issue Metro Bank faces is to grow the culture the right way for the long-term,” Donaldson says. “The moment we take our eye off our culture, it will veer a little bit. And if we let it veer, then in the next five years who knows where we’ll be. We must not let that happen.”
Use a common language
Donaldson refers to his staff as colleagues, not employees. Metro Bank has stores, not branches. Each year, they receive “amazing reviews,” not performance reviews. He says language is hugely important at Metro Bank; it brings energy, honesty, and common ground to every interaction. “Creating a common language means people have the right to challenge you using that common language, which means you are challenged to do better things.”
Be there and be present. Regularly.
It’s difficult to nurture culture if you aren’t there to experience it for yourself. “I love getting out and about really seeing and feeling what’s going on,” Donaldson says. “You can viscerally feel if it’s not right just by talking and being there.” He makes it a point to visit each store twice a year – he calls it his “Mischief and Mayhem Tour” – and meets in-person with a customer and a potential customer once a day.
He’s also constantly engaging with colleagues online using Yammer, an intra-company communication platform. Donaldson, who doesn’t have time for Facebook or Twitter, says he’s the third most active colleague on Yammer. He says it’s a great way to share ideas for improving the customer experience and bring up issues to senior management openly and honestly.
Don’t hide from customer complaints. Use them as inspiration.
Donaldson has customer complaints sent directly to him. Once a month, he and senior leadership spend three hours poring over every single one. It can be a painful process, but he says it helps hone customer intuition and instills empathy for customers. Sometimes it opens up breakthrough and lucrative new business ideas. For instance, after a customer complained of lost account information on sites like Amazon when she misplaced her credit card, a Metro Bank employee worked quickly to create a feature that lets customers turn their card “on” and “off” through the bank’s mobile app. It’s now a fixture on the app.
Be the extreme version of your company values
Above all, Donaldson says that leaders need to believe in the values and culture of their company. “I have to be the most extreme version of the values,” he says. “Data is really important, but I think intuition and belief in what you do is more important. I passionately believe customers want and deserve better service and that our job is to deliver it.”
As a CEO myself, this really resonated. When you listen to Donaldson speak about doing what’s right for customers or how proud he is of his team, you can feel his passion and sincerity. I encourage any CEO or business leader to listen to this episode, and consider what else you can be doing to create a culture and a company that truly is customer-inspired.