Yesterday, I received one of the few publications I find worth reading. Which publication? The 2014 UK Analysis put together by Nunwood‘s Customer Experience Excellence Centre. In this series of posts, I will be sharing with you my take on this report and its findings and recommendations. Let’s start with the dominant themes.
Little Change In The State of Customer Experience Excellence From 2013
The foreword by Marketing Week is full of the kind of exaggeration-hype that goes with much of marketing:
With customer experience now firmly established as the main competitive battleground for ambitious leaders, this is a uniquely rich insight into the best practices needed for success…..
- Mindi Chahal, Features Writer, MarketingWeek
Did you get the clue? The clue lies in the adjective ambitious as in ‘ambitious leaders’. It turns out that of the 250+ brands surveyed by Nunwood only a very small number are ‘ambitious’. And as such little has improved overall as regards the state of customer experience excellence in the UK. Which kind of makes me question the claim that customer experience is now firmly established as the main competitive battleground. My experience is that whilst it is talked about, that is pretty much all that happens: talk.
What do the folks at Nunwood say on this matter? This is what they say (bolding is my work):
A minority of brands are shining every brighter …… These examples of brilliance are dimmed by the larger set of brands whose efforts have stalled. Either because they have hit cultural glass ceilings …… or the ambition of their leaders has failed to match the rising expectations of UK consumers … This has meant that across all 263 brands analysed the overall improvement in performance was less than 1%.
The Biggest Improvement In Customer Experience Excellence Has Occurred In The Financial Services Sector
Which sectors show an improvement? Three of them: financial services, entertainment & leisure, and travel & notes.
Which sectors are stagnant? Three of them: telecommunications, restaurants & food, and non-food retailing.
Which sectors have declined? Two: utilities, and grocery retailing.
Did the financial services sector make the 2.2% improvement due to benevolent-enlightened leadership? Or a new found love of the customer? Or was it because some teeth have been put into a regulator and regulation? Here is Nunwood’s take on the situation (bolding is my work):
The financial services sector sees the largest improvement in performance …. This is in no small part due to the burning platform created by the government, media and regulators. New FCA-mandated focus on customer outcomes … has led to massive investments and exhaustive leadership attention.
It occurs to me that here we have a clue as to why there has been little or no change in all the other industry sectors. Organisations and the Tops that lead them do not willingly stop screwing their customers and employees. And so switch from the easy and established way of making ‘bad profits’ to doing the hard stuff of generating superior customer value and thus reaping ‘good profits’. This kind of behaviour is arrested and weakened through a combination of effective regulation and sustained media pressure. Which may explain why it is that the utilities sector, which has been the weakest in terms of customer experience excellence has slipped further down the rankings. In my view-experience the Ofgem, the regulator for gas+electricity market, is about as toothless as you can get.
The Same Brands Continue To Shine And Some Shine Less Brightly
By now, I suspect that you may really want to know who the UK’s Customer Experience leaders are. Here are the top 10:
1. First Direct (bank without high street presence)
2. John Lewis (multichannel retailer)
3. QVC (tv based shopping channel)
4. Lush (retailer)
5. Amazon (online retailer)
6. Appliances Online (online retailer of appliances)
7. Waitrose (grocery retailer)
8. Nationwide (building society, financial services)
9. Specsavers (retailer)
10. M+S Simply Food (grocery retailer)
10. Your M+S (retailer)
Here are my take on this Top 10 list in comparison with 2013:
- Virgin Atlantic and Ocado have dropped out of the Top 10. Virgin is now at number 21, and Ocado just outside the Top 10 at number 12.
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Appliances Online, Nationwide, and Specsavers are new to the Top 10. This is what Nunwood says about Appliances Online (ao.com):
A clear value proposition wedded to an excellent service culture sets the brand apart.
- Amazon continues its slide down the rankings here is what Nunwoods says:
Amazon …… continues to slip slightly in the rankings for the third year in a row, as consumers react to declining perceptions of its integrity and the performance of its delivery companies.
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Waitrose ascends the rankings moving from being number ten (2013) to being number 7 (2014).
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M+S (both Simply Food, and Your M+S) descend towards the bottom of the Top 10 in 2014.
My personal take is that Your M+S is a retailer in trouble. Management, probably in desperation, are bullying store managers. This then cascades down to the people on the shop flower. And in turn impacts the customer experience. So it will be interesting to see where Your M+S stands in the 2015 rankings.
The Secret of Customer Experience Success: Put Your Customers Second
You may have noticed that I insist on the need for and the critical importance of the human dimension: calling forth and putting into play the best of our humanity in order to orchestrate great relationships and generate great experiences. In short, to create a better world, a world that works for all: employees, suppliers, management, customers, shareholders, and the community.
More than once I have spelled out that the access to great customer experience lies through the folks that actually interact with and serve customers: the people working in the business and especially those who interact with and serve customers on a daily basis. Not technology! Technology can enable or hinder the customer experience. It is merely a tool.
Which means that there cannot be excellence in Customer Experience without excellence in Employee Experience. And these two have to be in tune with one another.
What does Nunwood say on the matter? Here is what Nunwood says (bolding is my work):
With only a single exception, the top 10 ‘Champion’ brands are characterised by their evangelical employees and superior cultures. Employees who are exceptionally proud of the brand they represent and the job they do each and every day for customers. Their culture plays a pivotal role in creating outstanding customer experience and they value that some culture first and foremost. In a very real sense, employees come first and customers come second.
Which is the single exception? I take it to be Amazon. And in the longer term this could be the undoing of Amazon.
Enough for today, I will continue this conversation in the next post. In that conversation I propose to explore the underlying factors that show a correlation with Customer Experience excellence. Until then I wish you the very best.
