2014 State of Customer Experience: Who Are UK’s 2014 Leaders And What Can We Learn From Them? (Part 1)
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.
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.
Waitrose ascends the rankings moving from being number ten (2013) to being number 7 (2014).
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.
A Skeptical Look Under The Hood Of Customer Engagement?
Why is Customer Engagement so fashionable? Is that because Tops, Middles, and Marketers have found Jesus and come to love the Customer? I say “No!”
It occurs to me that Customer Engagement has become fashionable because marketers have found it increasingly difficult to get the customer’s attention long enough to exercise their dark arts of activating-influencing-manipulating human beings to want what the marketers are paid to sell.
Put differently, the purpose of the bag of tricks that falls under fine sounding rhetoric of Customer Engagement is to get customers to march in tune with the marketer’s agenda: tell us about yourself so we can sell your data and send you marketing messages; buy from us and buy more from us; and sell us, and for us, by recommending us to your social network.
I say Customer Engagement is a Taker’s way of taking whilst masking-disguising the taking that is going on. Is it then a real surprise that whilst there is so much talk of Customer Engagement, there is so little in the way of success? Which might explain why the masters of the dark arts (those who advise-assist marketers) are busy inventing new tools-tricks for taking. And why marketers continue to fall for the latest tool-trick?
You may not be as skeptical as me; being skeptical as opposed to trusting-gullible is the norm, that is our default wiring. So I invite your to play a mind game. Imagine that every company that is busy with Customer Engagement scraps their existing engagement tools-tricks. Instead, customers vote and choose their champion: the customer champion. This customer champion is invited to any-every discussion in the business which makes decisions that impact customers. And no decision can be made without the agreement of the customer champion. In giving his/her consent the customer champion solicits the views of the people he represents: the customers. Is this not real engagement with customers? Then ask yourself if any business/organisation is doing this today. How many names have you come up with? Who even gets close to something like this?
What Is The Alternative To Customer Engagement?
If you showed up and travelled through life as a Giver how would you approach the Customer challenge? I say that you would not be asking yourself the following question: “How do I get the customers to engage with me and my agenda?”
It occurs to me that as a Giver you would be grappling with the following kinds of questions:
- How do I create superior value for my customers?
- How do I make their lives simpler-easier?
- How do I enrich the lives of our customers?
- What will it take for our organisation to leave customers feeling happy doing business with us and grateful that we exist?”
A Skeptical Look Under The Hood Of Employee Engagement?
Why is it the Employee Engagement is so fashionable? Is it because Tops, Middles and HR folks have found Jesus, recognised the universal brotherhood of man, and come to see the folks that work in the business as fellow human beings – of equal worth and value? I say “No!”
It occurs to me that Employee Engagement has become fashionable because the business place is so competitive. As such there is tremendous pressure on organisations to increase productivity and cut costs. And for some organisations, there is the added pressure of generating knowledge and converting this knowledge into new products, new services, and better (cheaper) ways of doing things.
Imagine one of the Tops getting up and saying: “We are keen, even desperate, to get as much knowledge-innovation-work out of our human resources as possible whilst paying the absolute minimum that we can get away with paying.” How much better, upstanding, uplifting, it sounds for a Top to talk about Employee Engagement.
I get that you may think that what I speak here is far-fetched. Let’s put that to the test. Imagine every company that is touting Employee Engagement goes to their employees and asks them to vote for and nominate an employees champion. And once this champion is appointed, s/he has to be presented in any-all discussion that affect the lives of the employees. And that no decisions that affect employees can be made unless the employees champion gives his/her agreement. Now tell me how many companies that you know which practice anything like this.
I say Employee Engagement is just another term devised by Takers to disguise their taking. And I am clear that most employee are wise to this. Why might just explain why there is so little ‘engagement’ and genuine collaboration in the very companies that are touting Employee Engagement and devising-implementing the latest bag of tricks dreamed up by those passing themselves of as masters of manipulating people (psychologists, social scientists, academics, consultants, change agents..).
What Is The Alternative To Employee Engagement?
I say that if you genuinely care about your fellow human beings you would never refer to them as human resources. Just get present to this term: where is the dignity in the term human resource? When you get home do you refer to husband/wife/partner and children as human resources? Do you view-call your friends and members of your social network human resources?
So how would you treat your employees if you showed up and travelled in this world as a Giver? Allow me to ask the same question differently. What are the kinds of questions you would be asking yourself if you genuinely cared by the wellbeing of your employees and the business? I say that you would be grappling with the following kinds of questions:
- What kind of workplace is most likely to show up as a great place to work for the people who work (or we want to work) in our organisation?
How do we involve our employees in the key business decisions especially those that affect them and their interactions-relationships with our-their customers?
How do we shape what we do and the way that we do it such that this resonates deeply with that which provides genuine meaning, uplifts our employees, and calls forth the very best they have to offer? What is it that we are doing-causing in the world that is speaks to and is worthy of the very best that lies at the deep core of our employees?
How do we make sure that we share, equitably, the fruits of the creativity-knowledge-innovation-work that flows from our employees?
I welcome your thoughts on the matters I have touched upon here.
The Economist Intelligence Unit has recently published a report titled ‘Outside looking in: The CMO struggles to get in sync with the C-suite’, sponsored by SAS. This report has showed up as rather interesting for me and I want to share with you that which has caught my interest.
CMO’s face a number of big problems
The fundamental problem is that CMOs don’t get much respect from the rest of the C-suite. CMOs say that they are doing a difficult job well: making a contribution/delivering significant value to product development, sales and customer service. The problem is that the rest of the C-suite don’t agree – they question the value/contribution that CMOs are making. And it doesn’t look like they listen to CMOs with much respect. Here is how the EIU report puts it:
“CMOs believe they are constrained because the rest of the organisation does not consider marketing to be strategic; the C-suite believes marketing has not earned the right to be more strategic because it is ineffective at demonstrating value of its investments.”
Here are the other big problems that CMOs face:
1. Many organisations have trouble defining, clearly/exactly, the CMO’s role and responsibilities. Which could explain why it is that there is no agreement on what business objective the CMO (and the marketing function) should focus upon and be held accountable for. Worse still there is a fundamental disagreement between what CMOs see as marketing’s priorities and the priorities that the other members of the C-suite assign to the marketing function. Which makes me wonder if members of the C-suite actually talk with each other, share and agree what they expect of one another. Doesn’t look like it. The EIU report says “..their greatest challenge: getting everyone to agree on marketing’s priorities.”
2. The marketing function is not coping with the challenge that comes with the territory that falls under the market umbrella: advertising, brand, market research, communications, customer analytics, social media, mobile and so forth. Why? First, the marketing function lacks people with the necessary skills and expertise to cope/deal with this broad/dynamic challenge. Second, members of the C-suite do not feel the CMO’s pain – they are not approving the necessary marketing investments.
So whilst it looks like CMOs are in a difficult position, there is no need to despair. The EIU reports offers a route to influence, credibility, impact and respect from the C-suite.
What can CMOs do to make an impact and amass influence/respect in the C-suite?
The EIU report advises CMOs to focus on the customer experience and the voice of the customer. The authors pin their hopes on the following quote from Steve Cannon, CEO, Mercedes Benz USA:
“Every single customer experience is a brand moment of truth. If we create an aspiration through our advertising, and a customer walks into a store and does not deliver on that promise that reflects on marketing.”
Any intelligent person could drive a coach and horses through this assertion. And for the the time being lets just accept and go with this assertion.
OK, if Customer Experience is the unifying theme and the rallying call for the organisation then how exactly can the CMO contribute to this play given that the CMO is not the CEO and does not control all the touchpoints, which as a whole, generate the Customer Experience?
Focus on the voice of the customer:
“Chief marketing officers (CMOs) stand a better chance of increasing their internal influence – and changing lingering doubts about marketing’s strategic contribution to the business – if marketing can consistently deliver insights and tools that benefit others across the organisation, from salespeople to call centre agents to merchandising teams.”
How feasible is this ‘success route’ being put forward by the EIU?
I say that there is a big difference between a poor strategist and a good strategist. A good strategist takes into account feasibility. Specifically, he asks this question: what is the likelihood that my client can execute this strategy? And the good strategist keeps on going until he comes up with a strategy that the client has a good chance of being able to execute successfully.
So let’s ask this question, how likely is it that marketing can:
a) marshal the voice of the customer from all the disparate sources and turn this into a comprehensive view – single view of the customer;
b) generate actionable insight into customers, how they interact with the business as a whole, the jobs that they hire the business to do for them, and their experience of using the product and dealing with the company?”; and
c) inspire the various members of the C-suite to act – to make changes in their priorities, policies and practices – so as to improve the customer experience?
I’ll let you decide for yourself. For my part I could not help noticing the following hurdles identified in the same EIU report:
1. Single customer view. “The airline [BA] has spent the better part of the last decade integrating its systems to support the effort; data warehouse not stores 200 separate data sources from different parts of the business to provide a more granular view of the customer, based on information they have volunteered.”
2. Converting data into actionable insight. “For all the talk about data-driven customer insight, marketers are just starting to understand how they should be using the growing repository of information they are collecting through digital media and other channels.”
What do I say?
I say that if you and your organisation are serious about building your competitive position and commercial success on the Customer Experience then follow the example of Steve Cannon the CEO of Mercedes Benz USA. Why?
Because, the role and this responsibility or organising the business around the Customer Experience is a huge change full of organisational politics. And as such it is beyond the remit and the capacity of the CMO and the marketing function. This role/challenge – that of aligning the organisation around the customer experience requires marshalling resources, reassigning resources, engendering and dealing with organisational conflict – belongs to the CEO.
Here is what Steve Cannon did in the words of the EIU report:
“..aligning the organisation around a superior customer experience has been the focus of Steve Cannon since he took over as CEO in January 2012…. Investments in customer experience programmes have been large – such as the formation of a dedicated customer experience team – and small – like providing Mercedes Benz dealers with iPads equipped with custom apps and videos.”
As regards what Steve Cannon is doing at Mercedes Benz USA I draw your attention to the following:
1. Steven Cannon was the CMO before he came the CEO. When he was the CMO he did not take charge of “aligning the organisation around a superior customer experience” No, he did it when he became the CEO. I say he is a smart man who has a sound grasp of reality.
2. If the CMO had come up with the clever idea of buying hundreds of iPads for dealers it is highly likely that he would have reinforced the C-suite’s already always listening of the marketing function as the “department of coloured pencils” (how one CEO described the marketing function) and s/he would not have got the budget approved by the CEO/CFO.
What do you say?