Successful brands are keeping promises

Can kept promises help your business to enhance sales and customer loyalty?

Brand Promise and Customer Expectations

In an era of social media prevalence, brands can rise and fall within minutes through positive or negative feedback online. Today, consumers value a brand based on measures that go beyond product or service; they choose products if the company’s values are aligned with theirs and are coherent in what the company claims and what it does.

Daily, on our way to work, buying a cup of coffee in a local café or checking a news feed online, we see and hear hundreds of catchy adverts and promos which communicate brand messages. Digital marketing experts estimate that most Americans see around 4,000 to 10,000 ads each day. So, we are surrounded with hundreds of messages that fit into an overall promise of a brand, but what is a “brand promise” and what role does it play in customer experience?

An effective brand promise is a strategic tool which helps companies communicate to their customers (and prospects) what to expect when buying or using their products or services.

Customer experience and brand promise are frequently intertwined – the value of a brand can be easily weakened if customer’s expectations are not aligned with company’s promises. For example, Ford Motor Company’s brand promise was “Quality is Job # 1” in the 1980s. However, owners of Ford’s cars had to spend lots of money on constant repairs. After such a bad customer experience, consumers gave Ford their own version of a brand promise with the common mantra: “Ford – Fix Or Repair Daily.” Ford’s problems with quality standards and reputation led to a fall in its market share from 23.6% in 1978 to 16.6% in 1981 and financial losses of $1.54 billion in 1980. Ford had to make considerable investments to improve the situation, and today the company’s brand promise is “Go Further.” Thus, we can see that customer experience and brand health need continuous monitoring and should be open to change at any time, in order to keep consistency in what is promised and what is offered.

The relationship between customer experience and brand promise can be expressed with the following equations:

Importance of Customer Loyalty

In 2019, customers have a wider variety of products to choose from than ever before, for example, an average grocery store carries 50 times as many products as 80 years ago. In order to remain competitive in a saturated market, it is important for companies to establish a strong base of customers who are loyal to their brand and faithful to their products.

Brand loyal customers are a significant advantage for a company, because they make repeated purchases, leading to higher profits. According to a research done by F. Reichheld – increasing customer retention by just 5% boosts profits by 25% to 95%. Customer loyalty also allows companies to spend less on customer acquisition (e.g. marketing), receive useful feedback for future product development and sell new products more easily. Therefore, companies try to keep their brand promises in order to retain and expand a loyal customer base.

Net-a-Porter’s Approach to Customer Loyalty

KAE recently attended an event with the Managing Director of Net-a-Porter, Matthew Woolsey. Net-a-Porter is a luxury online retailer, which promises to provide the world’s most coveted fashion brands. Matthew talked about how Net-a-Porter manages to build a system that rapidly meets evolving customer needs and expectations in order to keep its brand promise.

One of the keys to Net-a-Porter success is the trust and loyalty it has built from its customers. Brand loyalty can be achieved through a combination of coordinated and effective activities; usually including great customer service, engagement with customers and consistent delivery of value.

Effective activities that enable brand loyalty include continuously adding features and capabilities. For example, the launch of a new try-on and wait premium service, where orders are delivered within a couple of hours whilst the courier waits as a customer is trying on outfits to ensure she is satisfied with the purchase before leaving.

Indeed, Net-a-Porter customers expect a premium service in every aspect of their engagement with the brand. Even the smallest details are considered, e.g. a product’s beautiful wrapping or a delivery driver’s appearance. The speed of service is also essential in fashion – if customers are excited about fashion trends, they want a new item ‘here and now’, therefore Net-a-Porter personal shopping teams are available 24/7 and ready to help with customer’s request via the channel of their choice (WhatsApp message, call, email, etc.). These channels are also used to show customers the latest product arrivals and fashion trends in order to increase sales.

The company is also active in requesting ‘feedback discussions’ with customers, which helps to make improvements in the business, e.g. adjust product ranges, partner with top designers, as well as make customers feel valued, increasing loyalty and delivering on the brand promise.

These initiatives, when combined, support Net-a-Porter deliver on its brand promise. The additive value of each capability and service acts to enhance customer loyalty, this is to the extent where customer trust is so high, that a customer was cited to have purchased £115,000 worth of watches over Net-a-Porter’s WhatsApp channel.

Do you keep your promises?

We have established the benefits of building customer trust via consistently delivering on a brand’s promise, namely; increasing custom, average spend and reducing churn. With that said, trust cannot be bought, it can only be earnt. Actions such as those continually deployed by Net-a-Porter, over-time, create the trust and loyalty required to achieve outstanding financial and reputational results. These are lessons all businesses can utilise to improve financial performance and deliver great customer experience.