BHS (2)

I've just been watching the last half hour of Sir Philip Green's epic appearance before the BIS and W&P committee. The fact that he still uses a Nokia phone and a cheque book is actually quite revealing: for him, and possibly for other business leaders operating in the opaque world of private companies, the constraints within which they operate have not changed in the way that the corporate governance framework surrounding public companies has changed within the last three decades. At one point, when describing a meeting, in a smirking aside he said that that for those concerned about governance there was a non executive director present. Sadly, he did not respond to the question about what the committee might learn from the BHS debacle that could improve public trust in companies.

I was also interested that he made the point that struck me forcibly when watching Dominic Chappell in the same chair: why is it that apparently intelligent professional advisers are prepared to work for these people? It's all very reminiscent of Robert Maxwell: branded as unfit to run a public company, he still managed to surround himself with people who would back further ventures.

Banks, leading legal firms and the Big Four accountancy firms lend credibility to such people. They could do their own reputations some good by resisting the lure of lucrative fees and refusing to act for those who have benefited from business behaviour which has been to the detriment of employees, pensioners and all those who lose out when a company goes to the wall.

If Sir Philip makes good on his promise to sort out the BHS pension problems, I'll be impressed.

Sparks

The professor has recently been deeply irritated by the M&S loyalty scheme, Sparks. so irritated in fact that she wrote to the new CEO, Steve Rowe. The ensuing correspondence is reproduced below.

Email, 3 May 2016:

Dear Mr Rowe

Many congratulations on your new job. 

I am a loyal M&S customer. I have some questions and observations about the Sparks loyalty card and would be grateful for your comments.

1. Benefits to Sparks members?

I signed up for Sparks when it first launched. I receive emails about offers but they don’t seem to differ from what is already available in store and on line, and offer little advantage. For example, the recent invitation to see sale offers ahead of non Sparks members was limited to only a few hours before the sale began – by the time I was able to log in, the opportunity had already expired.

I have just checked my offers. 20% off dresses looks useful – but looking at the web site it appears that every customer is entitled to 20% off at the moment. Where’s the advantage to me? Can I actually get 40% off?

2. Technical issues.

Today I have received an email telling me that I may be able to compete for tickets to the Chelsea Flower show. To find out if I have enough Sparks, I have to log in. Why can’t the emails show my Sparks balance? The technology must be available: messages from Virgin Flying Club show my accumulated air miles. Indeed, why do I have to log in at all? Why can’t the messages include a link directly to my Sparks account?

It appears that I don’t have enough Sparks to enter the competition although I have a total of 12684 which sounds quite a lot. I'd like to be able to use this balance when shopping, as a Boots Advantage card allows. Or to exchange the Sparks for air miles as the Tesco Clubcard allows. 

I shop for food in M&S every week and buy clothes and other items about once a month. I've been doing so for a very long time: the Sparks card has made no difference to my pattern of spending. And I shall probably continue to be a loyal customer. But I’m really disappointed that M&S have introduced a loyalty card which offers so little to customers, compared to other retailers' schemes, because I think this damages the company's reputation. 

I'd very much like to know how far you think that the information gathered via the Sparks programme is worth when set against the costs of introducing the scheme and the possible negative effects of damage to the brand name.

Best wishes.

-------------

Reply, 3 May 2016:

Hi Laura

Thanks for emailing Steve Rowe about our new Sparks scheme. As a member of the Executive Office; I’m replying on his behalf.

I’d firstly like to assure you that Steve is aware of your email and has read it with interest.

We’re really excited about our new Sparks scheme but that being said, it is still a relatively new scheme. This means that we are still learning about the scheme and identifying what does and doesn’t work.

Our Sparks member’s club is going to help us understand, in more detail than ever, what our customers are inspired by and what items they love. From this, along with customers contact us directly, we’re able to inform our Sparks team more accurately what offers ours customers want and also what they expect from the scheme.

At the moment, the only way to access your points balance is by logging into your account. I agree and personally do quite like the idea of your balance or statement being on each offer email we send. I’ve sent this suggestion over to our Sparks Development team, who are using customer feedback as inspiration to improve the service.

Some offers can be used in conjunction but unfortunately, some can’t. The terms and conditions differ for each offer, so it’s always advised to check the details section of the offer. That being said, I want you to know that all your comments are being made available for our Sparks Development team to review and consider.

Sparks points have no monetary value but instead can be used to unlock different rewards and experiences. The more you acquire, the higher the level you progress to, which then means better offers and exclusive events.

We know that the scheme is being continuously improve, so with some hard work from us, I’m confident you’re going to start seeing improvements - no more of the same and boring offers but ones that are useful and tailored to you.

I’d like to assure you all your thoughts have been passed to the relevant people across M&S and all are being considered for our future plans. I really hope you’ll see some big improvements with our Sparks scheme soon.

Kind regards

-------------

Now, I didn't expect a personal reply from Mr Rowe (although I did send the message from my university account so that anyone reading it would know that I wasn't just any batty old M&S customer but a batty old professor...) But I did expect something rather more coherent, written in good English, and I could have done without the patronising tone.

But over the weekend I became irritated once more and sent this:

Dear Mr Rowe

I wrote to you recently about the Sparks loyalty card. For your information, I attach below my original email and the reply I received from your office.

I am prompted to write to you again after receiving on Friday an email telling me that my "new offers have arrived." (I noted in my original message that having to click and login to reach the details flagged in such emails is irritating: I do hope that my earlier comment has indeed inspired the Sparks development team...) My offers appear to be the opportunity to purchase a bottle of champagne for £10 and a bonus offer of a free pack of kiwi fruit (ah, not just *any* kiwi fruit, M&S *gold* kiwi fruit, sorry) worth £2. To claim the fruit I must first "claim" the offer to register it on my Sparks card: I can't just collect my fruit in store. 

In Waitrose yesterday morning I was offered a taste of some delicious cheese: the young lady at the cheese counter asked if I had a mywaitrose card, pointing out that if I did I would get a 20% discount automatically at the till when buying the cheese. In Boots, I was asked at the till if I would like to set my purchases against the balance accumulated on my Advantage card. Both experiences left me feeling kindly disposed towards both retailers.

Instead of introducing a simple loyalty scheme with clear and easily accessed benefits, M&S seems to have set up a very complicated system which offers loyal customers almost nothing. I do sincerely hope that you are getting positive feedback on the Sparks card from some people: a friend of mine described it as "as much use as chocolate teapot" (no, that's not intended as a product suggestion to inspire your people).

I would be very interested to hear your views on the scheme and, in particular, its strategic intent. In the current economic environment I would expect M&S to want to keep its traditional and loyal customers on side. Foisting a spurious loyalty scheme on us - one that is so far behind your competitors - seems more likely to alienate us.

Yours very sincerely

I did rather enjoy writing that. Once again, a speedy response from the same person:

Hi Laura

Thanks for getting back in touch with us. As with your first email, this has been passed to myself to respond to on behalf of Steve.

I’m sorry to hear that you’ve remained disappointed by the Sparks scheme and I appreciate your frustrations.

The purpose of allowing customers to activate the offers is that it gives you the opportunity to choose which offer you would like to select. It may be that a different once was available that you wanted, so we wouldn’t want to give you that choice.

Some offers, like the recent 10% off food are automatically registered to the cards. As this offer was so general and broad, we knew all our customer would enjoy it and therefore made it active on all Sparks cards.

I know it’s frustrating to not receive great offers but the Sparks scheme is totally optional and isn’t something you have to use.

As with your previous comments, I have reported your feedback to our Sparks Development Team. As explained, they do review, consider and use customer comments in order to improve the scheme.

On behalf of the Executive Office, many thanks for contacting us and sharing your thoughts with us.

Kind regards

Now, consider the 3rd and 4th paragraphs of this message: I can only assume that my correspondent is an unsupervised intern. 

I have a genuine concern here. The Sparks scheme must have cost a lot to implement and is stupidly complicated for customers so I wonder how easy it is for management to extract the data from it that it was presumably designed to generate. It is, of course, possible that Steve has been lumbered with something he would not have chosen and it may not be easy to row back from it or even to alter it. But I do hope that things change and that the unsatisfactory loyalty scheme and the poor literacy in the Executive Office are not symptoms of a worrying decline.

BHS

I am saddened by the demise of BHS. I feel so sorry for all the employees and pensioners whose lives have been turned upside down by greedy asset strippers.

My mum always said their tights were better than any others. We had two close family friends who were BHS store managers, from the1950s through to the 1970s and they said it was a great company to work for: at one time long-serving managers got sabbaticals - imagine that!

On the audit team there in 1967, I was alone one lunchtime when the chief accountant appeared. "Where are the lads?" he asked. "They're all at lunch but can I help you?" I replied. He grinned as if I'd said something rather funny and turned away, saying "I'll pop back later." "I'm the most senior person here today", I added. He turned back: the grin had been replaced by a look of astonishment, tinged with horror. "They sent a girl?" He vanished, muttering. I was, by that point in my training, used to far more offensive reactions from clients. To my astonishment, he returned later and apologised. He had phoned the firm to check up on me. He confessed that he had been surprised to discover that the firm employed female articled clerks but he thought it was a very good idea and we had a pleasant conversation.

Many years later I had the great pleasure of interviewing Denis Cassidy, BHS chairman and CEO in the 1980s, for a research study. He was a charming man but I think his experience at BHS in the Storehouse days had been frustrating and he talked much more about his other corporate roles.

Retailing is a cut-throat business these days. I wouldn't be at all surprised to see other long-established high street names going to the wall...