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No Excuse For Poor Corporate Reputation And Customer Experience

By Augie Ray | February 20, 2016 | 5 Comments

MarketingCustomer Experience

The Harris Poll released its latest Reputation Quotient® Report, and while it contains the expected data about the importance and business benefits of good reputation, I was struck by the diversity of the top ten companies in the study. The list includes several of my favorite companies–both personally as a consumer and professionally as a customer experience analyst–but when I cite these examples, people can be quick to provide reasons why these firms are unlike their own businesses and “have it easy.”

This year’s list demonstrates why that dismissal is an excuse.  The heterogeneity of the top ten most respected companies illustrates how easy it is to overlook the hard work of creating a great customer experience, building an ethical and customer-centric corporate culture and leading in a way that resonates with employees and consumers. The top ten firms in the 2016 poll are Amazon, Apple, Google, USAA, The Walt Disney Company, Publix Super Markets, Samsung, Berkshire Hathaway, Johnson & Johnson, and Kellogg Company.

Financial service firms are not known for their strong reputation (particularly in the aftermath of the financial crisis of 2007-08), but USAA is consistently noted for its strong reputation and Net Promoter Score. As a former employee, I can attest to the care the association takes to instill a sense of purpose in employees and offer the best customer experience in the industry. But I find when I mention USAA as an example to others in the financial service category, it is regularly dismissed for being owned by its members (or customers) rather than shareholders; it seems many believe that publicly-traded companies that must deliver strong quarterly financial results cannot also invest in great customer experience. This argument is easy to discredit given that eight of the firms on the top ten list are publicly held–Members own USAA, employees own Publix, and shareholders own the remaining eight (six of which outperformed the DJIA in the past twelve months).

Another favorite of mine is Disney. Everyone recognizes Disney as a company that provides an excellent customer experience, whether that be in the cinema, a resort, on Broadway or elsewhere.  I find that when offering Disney as an example, others suggest how easy Disney has it being in the entertainment and recreation industry–of course, people love Mickey Mouse, Walt Disney World, and Frozen! Business professionals with that attitude need to let it go because none of the other companies in the top ten list are in the entertainment or recreation business. Moreover, while Disney is the world’s second largest media conglomerate by revenue, Comcast is first, and it is probably no surprise that firm is missing from the top ten list, despite operating NBC, Universal Theme Parks and other entertainment and recreation divisions. There is something to learn from a firm that consistently produces a great product and service experience across diverse lines of business encompassing 149,000 employees in 40 countries.

One last example of the tendency to dismiss the lessons from the companies with the best reputations is that people find it easy to discount the success of Amazon and Google. They are “newer” companies that were unencumbered with “old-fashioned” business models and technology, and they offer (mostly) digital services that are “easy” to control given today’s interconnected world facilitating agile and rapid development and deployment. Once again, a glance at the remainder of the list renders these excuses moot. Half the companies in the top ten are more than 75 years old; Kellogg’s is 110 years old (as of yesterday!), and Johnson & Johnson was founded 130 years ago, and both are sold through retail channels with little ability to control the end-to-end customer experience. Meanwhile, other web firms, such as Yahoo and Facebook, are missing from the list, as are the deadpool of web companies that had the same advantages of Google and Amazon, including Lycos, Geocities, AtlaVista, and Excite, all of which were among the top 10 most popular websites in 1999. Easy, huh?

Rather than dismiss the best examples as “having it easy,” it is better to ask how they made achieving their excellent reputation look so easy. USAA focused on a particular audience, identified their unique needs and served them as well as possible. Walt Disney made risky and expensive bets that customers would reward high-quality experiences, creating the first feature-length animated movie (derided as “Disney’s Folly” until it set box office records) and purchasing 43 square miles of land near the unknown town of Orlando, FL. Amazon and Google both put customer experience and not technical capabilities at the center of their business models. While Amazon lost almost $3 billion between 1998 and 2002 to create a best-in-class ecommerce experience, Google puzzled people by offering a plain, white, featureless search page free of the advertising that clogged the other search engines and portals of the era.

What is even more important to appreciate about these four organizations is how much they have changed over the years without losing what made them special. Disney started as an animation studio making “shorts” and today owns cruise ships, resorts, ABC TV, movie studios and more. USAA began as an auto insurance association but now offers a wide slate of banking, mortgage and investment services along with life, homeowners, long-term care, small business and other insurance products. And Amazon and Google expanded beyond books and search into full e-commerce, internet advertising, cloud computing, mobile operating apps, systems and devices, subscription entertainment services, augmented reality, artificial intelligence, solar power and (soon) self-driving automobiles.

Rather than concentrating on a small set of reasons why these companies are different than our own, wouldn’t it be better to see the many ways these companies are similar to ours and how we might change to be more like the most respected businesses in the world? Building a better customer experience and powerful reputation is never easy, no matter how simple the leaders make it seem, and there is no question as to the business impact of doing so.  The Harris Poll notes that 53% of the general public indicates they proactively seek information about the companies they do business with, and 37% say they have decided not to do business with a company because of something they learned about how it conducts itself.

Improving customer experience and earning a better reputation is not simple, but bypassing excuses and studying the example of these ten companies is a step toward building secure relationships based on loyalty, a better reputation shared widely by advocates and sound, more sustainable business results.

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  • David Deal says:

    Spot on, Augie. It’s been said that great performers “make it look easy.” So, too, do successful brands make a great customer experience look easy. But as your post asserts, building a reputation and delivering a customer experience consistently, year after year, is anything but easy. An excellent case in point is Disney’s rollout of the MagicBand at Walt Disney World. Disney deserves credit for investing its enormous resources into making the customer experience more seamless and personalized through the development of MagicBands. But as Austin Carr wrote in a highly engaging Fast Company article, “The Messy Business of Reinventing Happiness,” the creation of MagicBands was a brusing, excruciatingly difficult process. Although the article contains some behind-the-scenes details that probably made the Disney brass uncomfortable, I believe Carr’s article complements yours as an interesting look at just how hard it is for a brand like Disney to delight its customers. Again, well done, Augie. (PS: here is Carr’s article for those who want to dig into it:

  • Roy Hilliard says:

    Great article Augie. What struck me is the comment about how customers seek out information on companies prior to purchases. I know that I do, but often struggle to find out the “real” story as information is coming from so many sources – many far too biased to be taken seriously. Not surprisingly, I believe the top 10 on the list are diligent in controlling that flow of data and in fact customizing it to the individual user as David pointed out.

    • Augie Ray says:

      Thanks Roy. I am not sure we really have any “control” over the flow of data, any longer. Marketers can offer content, be responsive, fight misinformation and do a number of things, but they cannot control information. And while I agree that the overflow of sources can make it challenging to know what is true or not, much research shows that people trust family and friends and reviews before they trust what brands say themselves. These ten do not “control” information–they craft a great customer experience, because in the end, the best way to control what people say is to give them experiences that get them saying positive things.

  • Scott Hays says:

    I like the angle on this — across industries and age of the company. Consumers have providers in many industries and they are likely to compare customer experience without regard to industry. “My mobile phone provider lets me change plans online. Why won’t my insurance company do that?” “I get mid-month usage updates from my power company. I want them from my water company too.” All organizations need to look to these innovators–competitors or not–and do their absolute best to keep up.