October 29, 2013
Simplicity the Key to Retail Success
If you want to succeed in retail, it’s best to follow the KISS (keep it simple stupid) rule. That’s a simplified analysis of Siegel+Gale’s fourth annual Global Brand Simplicity index report, which found:
- Three-quarters of consumers are more likely to recommend a brand because it provides simpler experiences and communications.
- Twenty-nine percent in the U.S. are willing to spend up to 4.6 percent more for a simpler experience.
"When consumers experience simplicity at every touchpoint, it inspires deeper trust and greater loyalty. This year’s Simplicity Index affirms that brands willing to simplify their customer experiences stand to gain more revenue," said Howard Belk, co-CEO and chief creative officer of Siegel+Gale, in a statement. "In the data, we have the percentage increase in price consumers said they would be willing to pay for simpler experiences offered by each brand included in the survey — a tangible illustration of the value of simplicity. Brands are leaving significant money on the table because of complexity."
Keeping things simple doesn’t just work for customers, but employees, as well. According to the study’s findings, innovation is more likely to thrive in organizations where direct goals are clearly communicated and shared.
"Employees find it easiest to innovate when they understand and are committed to their company’s purpose. We now have empirical evidence that a clear purpose is critical to creating a culture of innovation," said David Srere, co-CEO and chief strategy officer of Siegel+Gale. "But it has to be communicated from the top down, and articulated through the lens of simplicity."
Here are the top 25 brands to make Siegel+Gale’s list for the U.S. based on "perceived points of simplicity or complexity in consumer interaction with particular brands/industries":
1. Amazon
2. Netflix
3. McDonald’s
4. Subway
5. Zappos.com
6. Dunkin’ Donuts
7. Publix
8. Google
9. Southwest Airlines
10. Starbucks
11. Pizza Hut
12. Trader Joe’s
13. Burger King
14. KFC
15. Target
16. IKEA
17. Bing
18. Kroger
19. Groupon
20. Yahoo!
21. Apple
22. Old Navy
23. Walmart
24. Whole Foods
25. eBay
Not making the top of the U.S. list but number one on a global scale was Aldi. According to the report, Aldi has achieved "extraordinary success" by making "the most of its good-value-for-the-money reputation with both recession-strapped customers and shoppers just looking to spend less."
- Siegel+Gale Releases Its Fourth Annual Global Brand Simplicity Index, Demonstrates the Impact of Simplicity on Revenue, Brand Loyalty and Innovation – Siegel+Gale
- 2013 Global Brand Simplicity Index – Siegel+Gale
- Brand simplicity yields revenue, loyalty and innovation, the latest global research by Siegel+Gale proves – POPSOP
Discussion Questions
What role do you think simplicity plays in business success? Do you also see a connection between simplicity and innovation in corporate environments?
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My gosh, it seems like everyone’s making top-something lists these days.
Honestly, I don’t have any idea what they’re talking about. Obviously the simplest interaction is NO interaction (hence Amazon and Netflix top the list, but with very different sales results).
But there’s nothing about this list of 25 that makes me say “ahah!”
I’m thinking we should declare an official moratorium on “top n anything” lists.
Making things less complicated has to be good. That said, there’s no evidence (and none at their website either) that this index means anything. There is no reason why innovation and simplicity should be related. Clarity of purpose is not the same as simplicity.
Obviously simplicity plays a big role in business success. Siegel+Gale seems to want to list companies in their top 25 more for name recognition rather than those known for true simplicity. That’s why Aldi wasn’t at the top. I was surprised to see Kroger on the list. They operate under multiple banners and have a gimmicky loyalty card. But Aldi would surely be the king who should be on top.
Sometimes being simple means you don’t need a lot of innovation. Too much innovation is like having too many cooks in the kitchen. Take for example the failure of Delhaize with Bloom, Food Lion, Sweetbay, etc. They thought they were being innovative, were lauded in the press for their new formats, and had to close or sell them off.
It plays a significant role. As you look at the list of companies on Siegel & Gale’s top 25, one attribute they all have in common is that you know what you are going to get from them. Whether it is reliable ordering and service from Amazon and Zappos, or a great buying experience from Apple, or the same cup of coffee from any Starbucks, consistency is the name of the game. When you know what you stand for and that includes every employee from top to bottom, innovation will come. If the overall culture is not firmly established, innovation will be more difficult to achieve.
As they say, “If it’s a simple idea, it probably came from God.” We’ll know we finally get the value of simplicity when you can buy a car in under three hours, a person can carry the Tax Code with one hand and we actually understand how decisions are made in the US government.
While consumers do crave a simpler experience, I believe in most cases what they are looking for is “a consistent experience” rather than a simpler one. That consistency is driven by a discipline in the retail organization that drives the same message, benefits and offers across multiple channels using the same language and visuals.
The key for resellers is, regardless of the complexity behind the scenes, to deliver to customers and experience that is easy to understand and execute. The best way to do that is to have all members of the team fully understanding a limited number of elements, contributing to the perception that the experience is simple for the customer.
Keeping it simple is always a good idea, especially when you consider that customer interactions are usually brief. Giving associates complicated strategies to execute when customers would rather touch and go puts the customer and the associate at odds.
Customer facing technology should be easy for the customer to figure out as well. Complicated technology has the potential to make customers feel stupid and avoid the interaction completely.
Technology should be as easy for the least tech savvy customer to understand as it is for the most tech savvy. This strategy probably won’t win tech competitions, but it won’t alienate your hard earned customers either – always a good thing.
I’m all for making things simpler, but doubt that consumers will be motivated to buy based on that criteria. This list seems to be based on customer service, rather than being simple.
Maybe I’m simple but – like Paula – I have no clue what this study is talking about.
The “simple” explanation? It’s a way for Siegel+Gale to get some publicity once a year. My guess is that companies get “simple” points “simply” because Siegel+Gale say they do.
Here’s an example: Dunkin’ Donuts, I almost get. Here in a world of baristas gone wild we have a company that lets you order a “simple” cup of coffee, which makes Starbucks – where complexity is one of the brand attributes and the way to a customer’s ego – inclusion on the list a little harder to understand.
I’d go on, but this topic is obviously too complicated.
I love this research. Makes total sense and when you look at the top 25, they are all performing well or above average.
It is funny to have this topic today at the same time as a topic around expensive, consumer intrusive smart shelf technology (far from simple).
KISS works.
I could not help but notice that Southwest is the only airline to make the Top 25 list. That could be because they do follow the KISS method when it comes to customer satisfaction and ease of navigating the website for reservations, etc. Maybe the others should take a page from their book rather than continually trying to persuade us it is better to spend more.
It’s the single most important attribute for a successful retailer, in my mind. Emulators abound but for some easy lessons, look at the success (both instant and longer term) of a couple of burger joints: Shake Shack and In-N-Out Burger. Hamburger, fries, shake, that’s it. Much easier for all involved; customer, employer, supplier, designer. Do one thing and do it well.
Surprising to me that Amazon is on top of that list in that their offering is basically “anything, anytime,” yet by the mere fact that they’re so easy to use, they’re given the highest ranking simply because of their operational model. That in itself is a huge retail lesson.
I spend a lot of time with technology clients helping them to express a product’s brand message in a single sentence; most have great difficulty doing this. The simpler, the better. That said, Paula’s right about the Top 20 lists that are everywhere!
Beauty lies in the eyes of the “beholders” … and in retail the beholders vote with their wallets based on their end-to-end experience.
It would be very interesting to correlate this top 25 list to each company’s financial performance.
Regardless of whether you call it “simplicity” or consumer centricity, or something else, there is a reason why consumers “vote” Amazon to 20+% annual growth.
The common denominator across these brands appears to be the level to which they deliver consistency in the customer experience. Consistency is the result of thoughtful, intentional design, and as seen in this list, applies to both online and brick and mortar experiences.
Intentional experience design, at its best, uncovers and removes friction, hurdles and related processes that result in less than optimal experiences. The result is a brand experience perceived as simpler and more positive, translating into stronger business performance.
The top list of perceived simplicity or complexity? Siegel+Gale has just violated the point of their article. Are these the top 25 companies that perceived simplicity or perceived complexity and which are which? What?
Crafting simplicity into business interactions and transactions is anything but simple, especially at scale. That said, it should always be top of mind, and constantly putting ourselves in the headspace of the customer is the best way to understand where complexity is a roadblock.
It’s definitely an evolving discipline, but one worthy of pursuit.
It’s not always easy to create simplicity. Sometimes it is downright complicated. How important is it? Read the stats. And the old adage that a confused customer doesn’t buy is spot on. Some of the most innovative companies deliver simplicity, regardless of the product. Their theme or brand promise is simple and direct. Simplicity is a great customer experience that customers appreciate and, in some cases, will pay more for.
Oh my! Can someone define simple for me here? If I go into a store and can immediately have what I want, in the right size, no trying on, no lines to stand it, how in the world did that ‘inspire deeper trust and loyalty’?
Doesn’t it all depend on whether they did it right?
And, BTW, what is ‘simple’ about shopping at IKEA? It takes an entire afternoon just to get through the store! Now, don’t get me wrong, I heart IKEA but it is a destination shopping spree, not an everyday thing. It’s not simple.
Boy, I must have totally missed the boat on this one or maybe I just took it too simply.