News & Views

Efficiency is the new Premium

by Georgia Malden

Focusing on the most prosaic elements of the customer experience might not win you gongs at Cannes, says Georgia Malden, but it’s more important for building your brand

I confess to behaving like the kind of spoilt people Louis CK so brilliantly derides, when I found myself railing this Christmas against the ineptitude of a retailer when it came to delivering my order. (This wasn’t Amazon, I hasten to add, but a brand retailer with the kind of low-on-lighting but high-on-music physical retail experience that most self-respecting 40-year-olds would pay a premium to avoid.) Just as most of us have become blasé at the miracle of human flight, I no longer think it’s amazing that I should be able to order online and receive my items the next day. In fact, I expect nothing less, and am really not happy if brands fail to deliver.

Delivery woes

And I wasn’t alone in being let down this Christmas. According to a YouGov survey on behalf of the software company JDA released last week, almost one in three (31%) online shoppers in the UK had problems with their internet orders in December.  It seems that UK retailers were taken by surprise by the growth of the Black Friday/Cyber Monday phenomenon this side of the pond – despite fuelling this shopping frenzy themselves. Operational problems off the back of its Black Friday promotions have been partly blamed for the 5.9% decline in online sales reported by high street retailer M&S for the third quarter. At one point, M&S was indicating delivery turnaround times of up to ten days. Even Christmas success story John Lewis, which experienced a 19% rise in online purchases in the five weeks to 27 December, has warned against the negative impact of Black Friday on backend logistics.

The experience is the brand

The problem is that the gap between people’s expectations and the reality of retailers’ ability to meet them is commercially significant. Numerous stats demonstrate that people will defect to a competitor following a poor experience (89% say they have done so, according to the Oracle/RightNow CEI Report; 60% have bailed on a transaction for the same reason, according to Amex’s 2014 Global Customer Service Barometer). This impact is compounded by the higher costs of acquisition over retention. Failing to deliver to existing customers (both literally and metaphorically) is something brands simply can’t afford to do, not least because bad news travels fast: people are much more likely to tell their friends about a poor experience than they are a good one. According to the same Amex barometer, people tell an average of 21 people about a bad experience, compared to eight for a good one. Such reputation-bashing equates to a pretty negative impact on the brand. 

With the lines between brand, marketing and customer experience increasingly blurring, it’s never been more important to recognise that everything a company says and does contributes to the brand. As Nigel Hollis notes in his opinion piece on our site this week in relation to media fragmentation, ‘brand identity and story need to be strongly reinforced across all channels to deliver a coherent impression’. In an era where actions speak louder than words because of the rise of transparency and technology-heightened expectations, this applies to every aspect of the customer experience, not just media. 

Meeting the premium promise

I’m doing some interesting research on behalf of a client at the moment into the attributes of premium brands and the kinds of visual codes and principles used to communicate ‘premiumness’. There are of course lots of elements that can come into play, from authenticity, performance and connoisseurship, to the use of lifestyle associations, beautiful people and cultural icons. But what struck me, in light of my Christmas shopping experiences, was how little these matter if the brand promise and the experience don’t match up. And by experience, I don’t necessarily mean the fancy multi-sensory or immersive elements, but the more basic stuff. Like my bloody hoodie arriving on time. It’s a trick that Uber has managed to pull off, somehow feeling premium by dint of the sheer seamlessness of the experience rather than smart advertising, despite often being cheaper than more mundane alternatives (surge-pricing not withstanding). (See our Contagious X case study for more on Uber.)

Joining the dots

Nespresso meanwhile is a standout example of a brand that manages to package it all up nicely. While I appreciate that non-believers may find a lot to roll their eyes at (all those pods! Those George Clooney ads! The sheer hermetically-sealed smugness!), what Nespresso has absolutely nailed is the consistency of the experience. That goes for both the quality of the product (the upside of those pods is that they leave little room for human error), and the quality of the service. Ok, the whole idea of being a member of a club may be a bit contrived, but you can’t fault them on delivery. Of all my Christmas purchasing, this was the most seamless by far. But if it didn’t all work so beautifully, the language and iconography of ‘Grand Crus’ and ‘treating’ would be like failing to add water to the machine. Taken together, they add up to one fine brew.

With that in mind it’s sobering that the hallmark of John Lewis’s success this Christmas was something as prosaic as Click & Collect, selected as the preferred delivery option by more than half of its online shoppers (56%). As my colleague Chloe Markowicz explored in our case study on the department store last year, this is a retailer excelling through its relentless focus on the customer experience. Again, it’s the consistency with which it is translating its longstanding values of quality and trust into a holistic experience across all touchpoints that sets it apart. And that includes the kind of unsexy things that are, to use the logistical term, a ball ache to offer but customers actually really want – such as transparent stock inventory, and multiple delivery options. There’s more to retail than in-store beacons and startup incubators.

Fur coat, no knickers?

In light of this, I was struck when I read in Fjord’s 2015 Trends report (p.12) that a leading (unnamed) retailer’s head of ecommerce had told them that while transparent inventory is a ‘worthy endeavor’, it is not ‘prestigious’ enough for brands to take on. It seems that it’s all too tempting to focus on window dressing for the brand – whether that’s glitzy marketing campaigns that express the brand values or PR-grabbing innovation ideas – rather than what matters to real people. It’s simply easier to bolt-on ‘innovations’ that provide spikes of interest, than delve into the operational nuts and bolts behind the scenes that contribute to making the whole process better.

We see a lot of exciting and laudable innovations at Contagious – things like L’Oreal’s magic mirror that helps users virtually try on different cosmetics, or the DIY retailer Lowe’s introduction of a robot assistant (above  a kind of angular and not-so-cute Baymax  from my favourite film this Christmas, Disney’s Big Hero 6). But we always try to judge these by the Contagious commandment: ‘Prioritise experience over innovation' – i.e. do they actually improve people’s lives in some way, or is this more about being the first to do something? (See Paul’s piece on the Contagious Ten Commandments for a full roundup.) This goes far beyond retail. Maybe the smartest way to differentiate any brand is to focus on all the apparently small details and concentrate on creating a superlative experience across all of them? 

So, on my Christmas list for next year, Santa Baby, is efficiency, consistency, met promises, and maybe my very own Baymax. Now that would be amazing.