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Havas’ X-Index: trends and takeaways
Both as marketers and as consumers, we know that consumer behaviours and expectations are changing and evolving faster than ever before. Covid has accelerated these shifts even further; for example Mckinsey data tells us that in just 3 months in 2020, e-commerce penetration grew the equivalent of the 10 years’ prior. Crucially many of these changes are here to stay, with Havas’ Future of E-commerce Prosumer study of October 2021 underlining the fact that consumers are planning to continue shopping online rather than returning in-store.
In line with this shift we see brands investing heavily in their CX, to keep pace with these changing behaviours and expectations. Dash Research projects that the global market for CX / CE software and services will exceed $100bn by 2026, up from around $68bn in 2019. But are brands and their customers realising a meaningful return on this investment?
The sobering truth is that just 32% of UK consumers surveyed for the latest round of Havas CX’s proprietary X-Index research (published 1st February 2022) say that they feel the brands they buy from are focussed on their needs as a customer.
So where should brands focus, to keep pace with – or even ahead of – changing consumer expectations, to deliver a best-in-class customer experience?
Conducted across 9 markets (Brazil, China, France, India, Portugal, Spain, Turkey, UK & US), the X-Index invites consumers to rate the interactions they have had with brands they have purchased from in the past 12 months. In total, 35 measures are incorporated, and these can be clustered around 5 essential steps in the customer experience:
1. Brand image
2. Purchase
3. Product and service experience
4. Relationship
5. Customer service
What is striking is that, across all markets, brand image is the strongest contributor to the X-Index, representing 52% of the UK’s score.
What we’ve heard loud and clear from UK consumers is that brands need to consistently deliver on the brand promise throughout the customer experience. Whilst the purchase journey is shown to be the second most discriminating factor across the more developed economies surveyed, including the UK (32%), it is not enough to be simple and easy to transact with; a company must interact with its customers in a way that is distinct to and ownable by the brand, to create an experience that feels differentiated, and becomes familiar to its customers over time.
This key finding is reflected in Havas’ proprietary Meaningful Brands research, which similarly shows the disconnect between what companies promise at a brand level and the lived experience of being a customer (77% ‘expect brands to make a difference to my life’, but only 40% think they do).
That giffgaff is the highest scoring brand in the UK market for the second year running demonstrates this finding in action: a less mature and lower-cost player in the crowded and competitive UK mobile telecoms market, customers adjust their service expectations accordingly. However, giffgaff consistently meets or exceeds these expectations, and delivers service in a way that is unique and differentiating.
It is not enough to be simple and easy to transact with; a company must interact with its customers in a way that is distinct to and ownable by the brand, to create an experience that feels differentiated, and becomes familiar to its customers over time
Lucy Halley, Head of Strategy, London at Havas CX helia
UK consumers – like their counterparts globally – scored ‘I trust the brand’ as the most important and discriminating factor across the customer experience for both bricks & clicks and digital pure players. ‘This brand keeps its commitments’ was similarly ranked 2nd most discriminating factor for bricks and clicks brands in the UK & 3rd for digital pure players.
But asking a customer to ‘trust me’ makes a brand sound inherently untrustworthy. Brands must earn trust through their actions, enabling customers to understand how they are different from and better than their competitors. It’s why at Havas CX helia, at the beginning of the pandemic, when all of our inboxes were clogged with emails from brands telling us that ‘we’re in this together’, we counselled our own clients to perhaps not communicate unless they were doing something differently, that was going to be genuinely useful in their customers’ lives – the extraordinary lengths that Tesco went to keep its customers and colleagues safe, for example; Toolstation’s category-leading click & collect proposition.
The presence of Havas’ own client The Open University in the X-Index top ten, demonstrates the importance of trust in a brand when delivering a best-in-class customer experience. Pioneers in distance learning, The Open University was uniquely placed to continue delivering quality online learning and support its students throughout the pandemic.
Now that consumers often consider themselves to be ‘loyal to many’ in any given category, the ability of a brand to go the extra mile to surprise and delight its customers, to recognise and reward their existing, everyday spend will drive them back into the arms of your brand time and again
Lucy Halley, Head of Strategy, London at Havas CX helia
In more developed economies, where functional ease of transaction is now expected – a hygiene factor – emotional connection with the brand is now prioritised (40% functional / 60% emotional for UK consumers) and what ultimately differentiates the customer experience.
Now that consumers often consider themselves to be ‘loyal to many’ in any given category, the ability of a brand to go the extra mile to surprise and delight its customers, to recognise and reward their existing, everyday spend will drive them back into the arms of your brand time and again.
They want to see their own personal values reflected in the values of the brands they choose to buy from, and an experience that is inclusive and welcoming to all.
This is why Cult Beauty rank 4th in the UK in our study as they work to break down taboos – by openly addressing the subject of menopause, for example. And why IKEA – who have worked so hard to advance the sustainability agenda – are ranked 10th.
1. Consistently deliver on the brand promise across the customer experience
2. Earn consumers’ trust through actions, not words
3. Connect with consumers emotionally, to drive differentiation and loyalty
Lucy joined Havas CX helia in 2019 as its London Head of Strategy, a role in which she ensures and oversees the quality of the agency's strategic output across clients. She has nearly 25 years’ experience in customer engagement agencies, including EHS Brann, RAPP, Kitcatt Nohr and Digitas UK, and has a range of sector experience including financial services, automotive, retail, fundraising and utilities. She is a DMA Awards and Effies judge. Lucy is passionate about understanding how to motivate customers to respond in ways that drive value for her clients' businesses, and about creating the meaningful value exchange between clients and their customers that lies at the heart of all meaningful experiences.
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