Brands that have had their reputations dented by not paying UK corporation tax are faring poorly when it comes to ratings of overall customer experience with those companies, according to a ranking of the top brands shown exclusively to Marketing Week.
Amazon, which has ranked number one in Nunwood’s Top 100 brands for customer experience list for the past three years, is now rated fourth. The new holder of the top spot is John Lewis, followed in second place by shopping channel QVC and in third is financial brand First Direct (see chart below).
Nunwood director David Conway says: “We’ve seen Amazon – which has topped the list for the past three years – drop to fourth place and much of that is to do with the adverse publicity it received [regarding its tax arrangements]. It goes to show that no matter how good you are at managing your day-to-day operations, you also need to manage reputational risk because that plays a big part in people’s mindsets and how they feel about you as a brand.”
Starbucks – which has also been under fire for not paying corporation tax in the UK – does not feature in the Top 100 at all.
The issue of reputation is also apparent in the banking sector. The Co-operative Bank, which featured in Nunwood’s Top 10 last year, has dropped right out of the Top 100, which Conway attributes to the £1.5bn hole the bank recently discovered in its balance sheet, a rescue plan for which it announced this week.
“What we noticed last year was a move away from financial institutions, whose reputation in the market wasn’t great, to some of the smaller, more niche operations that people felt would be more trustworthy,” says Conway.
“M&S Money – at number 23 in this year’s list – has benefited from that continual migration,” he adds. “People trust the M&S brand more than they trust the big high street banks.”
Personal trust and integrity is an important factor in customer experience and this year’s Top 20 is dominated by companies that are still managed by their founders. Beauty brand Lush (ranked 7), wine retailer Laithwaites (17) and mobile network Giffgaff (33) all fall into this category, along with Specsavers at 12.
|Rank||Brand||CEE Metric 2013||Change vs 2012|
|1||John Lewis||8.25||+ 1|
|3||First Direct||8.19||+ 1|
|5||Virgin Atlantic||8.01||+ 5|
|6||M&S (food)||8.00||= 0|
|9||M&S (brand)||7.93||+ 2|
“The focus on detail and the energy and drive seem to have paid off for those particular brands,” says Conway.
Laithwaites operates predominantly over the phone and via email and has a small but increasing physical footprint. “We get quite a few letters and if somebody’s upset about something, they wouldn’t think twice about writing to [founder] Tony Laithwaite,” says Kevin Hanley, wine operations director at Laithwaites. “People write to Tony and he writes back.”
Hanley adds: “You have to recognise your customer wherever you see them and attempt to deliver consistency of service across all channels. Whether they choose to phone you up, log onto the website or walk into your store, you should be able to tell them what they ordered last week. If they rate a wine online, someone in store should know that that’s a favourite wine of theirs. It’s about delivering seamless, end-to-end customer service.”
Like Laithwaites, brands such as Amazon, QVC and First Direct have proved that a company can provide good customer service despite not having face-to-face contact with consumers.
“If we look at Amazon for the benchmark of online service,” says Conway, “99.9 per cent of us never speak to anyone there and yet there’s a very strong emotional connection between us and the website and Amazon as a business. The secret behind it is the degree to which the Amazon website replicates what we would do naturally as human beings.
”It uses our name, it tells us the things we’ve purchased recently, it shows us what other people like us might buy – which we’d expect if we went into a store and spoke to someone. The human brain doesn’t distinguish between being flattered by a machine versus being flattered by a person in a store.
“Four years ago, when we started the Top 100 list, people tended to think about the customer experience within the category they were relating it to – financial services, for example,” says Conway. “Now people’s expectations have changed; they expect every online experience to be like Amazon’s and every retail experience to be like going to the Apple Store.
“If you get your online experience right and replicate the humanness of the experience, you can build an emotional connection with the individual and overcome the issues associated with not having a high street presence,” says Conway.
We hire for behaviours and cultural fit, not competence… people who know what service is without having delivered it because we can train them on that
Shopping channel QVC, a company not previously included in the 260 brands that Nunwood asks consumers to rate, has gone straight in at second place on the list. It gets record scores for empathy, achieved through viewers’ emotive connection with TV presenters and a well-regarded contact centre, with the latter also contributing to a very strong performance for ‘resolution’, or how the company responds whensomething goes wrong.
“QVC is in people’s homes and although there is no direct ‘face’ of customer service, there’s the direct faces of our presenters. Our challenge, from a customer service perspective, is to match that presenter’s style, that ’over the garden fence’ conversational interaction,” says QVC director of customer services James Keegan.
“We now hire very much for behaviours and cultural fit, not competence. [We look for] people who know what service is without ever having delivered it before because we can skill, coach and train them on how they turn that belief and feeling into something that’s very demonstrable to a customer,” he says.
For Laithwaites, good customer service means that it is personalised, reliable and hasslefree. “If you call our customer service department, you speak to a person very quickly; you don’t go through an IVR [interactive voice response] system,” says Hanley. “Advisers are empowered to deal with your query; they don’t have to ask a manager whether they can refund someone for a bottle of wine they didn’t like.
”We’ve made it a particular focus to try to encourage listening and empathy, reflecting back the tone and mood of the customer. You can tell whether someone wants to be addressed by their title or first name very early on in a call if you listen.”
Butlins is the top mover in this year’s Nunwood rankings, climbing 151 places to number 14 and achieving the largest customer experience improvement across all measured UK brands this year.
Recognising that the root of poor customer experience lay deep in the organisation’s cultural foundations, the brand decided it must change. It worked on empowering frontline staff to resolve problems the first time a customer complained, as well as encouraging them to use positive language and behaviour at every level of the organisation.
“The brand is over 75 years old. What was missing was that cultural focus on the guest,” says Drew Stevens-King, head of culture and development at Butlins.
The brand devised Road Map, a ‘language’ for the new company culture, and implemented a colleague-to-colleague training programme.
“We’re very lucky that we have the founder’s name [Billy Butlin] as our company name,” explains Stevens-King. “We tell customers a wonderful story: the team that comes in is carrying on the Butlins legacy. And they begin to buy into it; they begin to love the brand.
“If you can get the team to love the brand, they will love the customer and the customer will love us. It’s a very medium– to long–term strategy, so consequently it’s taken us 10 years to get here,” he says.
Changing the culture of the company to improve customer experience has led to improvements for the Butlins brand.
Stevens-King says: “People feel like they’ve come on holiday to have a break with a brand that really cares about them. Then they come back and buy more. When they come back, we’ve got their loyalty and, with the profits, we can reinvest into the company. Consequently, we’ve been able to build three new hotels [in the Bognor Regis resort].”
As the new holder of first place on the Nunwood list, John Lewis offers knowledgeable staff with non-pushy sales tactics and a smart appearance, contributing to its reputation among consumers of trustworthiness. The company employs a policy called Heroic Recovery, where in the event of a customer having a problem, staff are empowered to take the necessary action to resolve it.
Conway concludes: “With a lot of organisations it’s ’sell and forget’, but with organisations like these it’s much more about what you do afterwards in terms of building the relationship and fixing things that might go wrong. That’s where John Lewis is so outstanding.”
Research agency Nunwood’s top 100 customer experience list ranks the best players and seeks to understand best practice across different industries. The online survey samples about 7,500 consumers, asking about their customer service experiences in the past six months. Brands are then rated to create the CEE Metric. The CEE Metric is a weighted average of the six ‘pillars’ of experience excellence: personalisation, time & effort, expectations, integrity, resolution and empathy. These pillars have been statistically proven to drive customer advocacy and loyalty. The weighted average is calculated by the respective impact of the pillars on these two commercial outcomes.