Brand owners need to adopt simplicity as a guiding principle because consumers are turning their backs on retailers and service providers that are perceived to be difficult to do business with
Many brands are perceived as making their customers’ day-to-day lives even more difficult, according to research by strategic branding firm Siegel & Gale.
Over two-thirds (69%) of UK consumers have stopped doing business with a company or abandoned a purchase because a transaction was too difficult to complete.
The research was carried out by creating a Simplicity Index with a scale of 0 to 100 to measure the degree to which consumers find companies and organisations easy or difficult to do business with. The index is derived from ratings by respondents of a defined set of brands, and the frequency with which a brand is cited as one of the three easiest or most difficult brands to do business with.
The “simple” end of the index, identifying brands achieving a rating of 70 out of 100 or above, is dominated by online retail brands and traditional high street brands. Brands achieving a score of between 40 and 70 are typically travel, leisure and financial services providers, while the “complex” group of brands and services achieving ratings of less than 40 is populated by the remaining financial services offerings, government services and utilities – organisations that consumers tend to engage with through call centres or highly regulated processes.
But sector dynamics alone cannot be used as an excuse for brand owners addressing the relative complexity of their brands.
There is clearly an opportunity for a contract-based business to build advantage by creating simple, clearly-worded agreements that customers feel confident about. Of those who took part in the survey, 80% think that contracts for mobile phones, credit cards and cable/satellite services are too difficult to understand. This complaint could well be a primary driver for Sky and BT’s ratings of 23 and 14 respectively, while British Gas only managed to score 6.
Foxtons also rated poorly in the survey with an index rating of 25. As the most strongly branded estate agent, Foxtons often takes the brunt of criticism levelled at the sector, so has the most to gain by creating a transparent and client-friendly offering.
The top-rated brands were Amazon, Boots and Asda, but why does Boots, with a score of 81, outscore Body Shop at 62? Over the years, Boots has maintained its focus on a clear customer promise. By contrast, Body Shop seems to have lost its way. The mantra of sustainability has been adopted by other mainstream brands, rendering Body Shop’s once-unique purpose less distinctive, and without the remarkable Anita Roddick, less persuasively communicated.
A real stand-out is O2 versus Orange. O2 enters the index as the highest telecoms provider at a comparatively healthy 56 by keeping it simple and focusing on a handful of hero products such as Bluebook. But Orange’s development of Dolphin, Canary and other sub-brands bring complexity and may actually be hurting Orange.
Respondents were also asked to rate sectors on a scale of 1-10 based on how easy or difficult they are to do business with. The rating was then translated into a 0-100 index. Estate agents (20) and government agencies (17) are rated as the most difficult sectors to do business with, while traditional (73) and online (71) retailers are rated as the easiest. Even though the airlines sector (52) appears to do well, Ryanair only reached 34 in the index, well below easyJet (49), British Airways (49) and BMI (48).
Simplicity should be a guiding principle for brands. Brand owners can take steps to assess when and how their brand can achieve more simplicity in three key ways – defining a simple brand promise that addresses customers’ real needs; identifying potential “strain-points” when customers are choosing a brand; and elevating key moments in the customer experience that the brand can own – delivering the simple promise.
Customers have continued to do business with complex organisations, either because they feel they have no choice or because they see the competitors as equally complicated. But as economic uncertainty increases and consumers seek more control over how they spend their money, overly complex businesses are vulnerable.
The businesses that will win have a simple customer promise, hassle-free customer journey and clear communications.
It’s not all bad news for the brands at the bottom of the table. In sectors that are seen as difficult to do business with, customers also have lower expectations. Brands that take the initiative as problem-solvers will have an advantage when it comes to building satisfaction.
The resounding message from today’s time-poor, spend-wary consumers is that brands must be simpler. Brand owners can benefit by looking beyond products and services to the customer’s brand experience and seizing every opportunity to simplify the way they do business.†
Fred Burt, managing director or Siegel+Gale, contributed to this week’s Trends Insight