By Alex Balcombe, Partner at Harris Balcombe
John Lewis, Tesco, and Hotpoint have all been in the news in recent months over product recalls. They can affect your reputation and potentially cause long-term damage to your business. Dealing with the ensuing regulatory issues, while establishing out what actually went wrong to prevent it happening in the future, can be stressful, particularly when you’re also trying to manage your insurance claim.
One of the biggest concerns in product recall situations is damage to reputation. Will it cause people to turn away from your brand in the future? Will it affect their thoughts of your brand? And how will you deal with a potential loss in profits?
There are a number of reasons that products can get recalled – but usually it’s for safety or quality reasons, spanning from food contamination to fire risks. One of the more recent and widespread recalls came from the washing machines of Hotpoint and Indesit. It found that models it has been producing between 2014 and 2018 could have a defective door catch on certain models, which can lead to overheating during use.
They do have the potential to cause catastrophic losses to businesses. One extreme, global example was the Samsung Galaxy Note 7 recall, following the news that some of them were bursting into flames. The issue cost them $5.3 billion.
No matter what, you must be able to minimise the disruption of your business. From food to pharmaceuticals, how can you best handle a product recall situation?
Plan before it happens
Assume that every single one of your products could get recalled at some stage. It sounds extreme, but it’s far better to be proactive and have a plan in place ahead of time. Ensure that you have taken out the appropriate insurance, and make sure you also get advice on any issues that might affect liability, such as compliance with warranties and conditions.
It may not be your manufactured product that causes a recall, it could be something from a supplier. Make sure that, whether you’re in the automotive or grocery sector, you cover your bases and analyse health and safety standards before getting into business with them. If you can, tour their warehouse, check for reviews and thoroughly check to make sure there have not been prior issues with the stock.
Don’t sacrifice satisfaction for profit
One serious mistake some can make is to focus specifically on profit in the event of a significant recall. But this focus can actually be detrimental to your profits later down the line – especially if people can tell that you’re just focused on the bottom line.Sometimes you just need to take a revenue hit in the short term, to ensure that customers stay loyal. Offer a full refund if possible, pay for repairs, or offer other beneficial alternatives. Make it as easy as possible for them to return or dispose of the product.
No one likes it when they don’t get answers. Don’t just issue one press release, then hide and avoid other communication. Social media can be a really good benefit, not a hindrance, for those who suffer product recall situations, as it allows you to keep contact with your customers and maintain messaging on your own terms. You might even find out about a defect from a social media message.
In the short term, you may need to hire extra staff to keep communications always on, especially if it is a safety issue. Hold a press conference, issue a statement, and being open will help you to maintain professionalism but also ease the minds of your customers.
Release thorough information
People want to know where to go from here, especially if it’s food, pharmaceutical or child-related. Do they need to get checked by a GP? Do estate agents need to issue certain advice to their tenants if they own a certain appliance? They may need specific or technical advice.
Make sure you educate and inform your customers – no information is too much information. But it must be easy to understand – write to your audience. If they can’t understand the corporate or business jargon you’re using, they might not understand the importance of the recall or actions they need to take.
Stay Legal – Don’t Cut Corners
Obviously you’ll get advice throughout (and hopefully before), but when a recall involves potential dangers, to your customers, you need to make sure that you’re complying by all legalities as government agencies will also likely get involved. Make sure that all steps are taken – any work to reduce this next time.
The insurance claim process can be tricky and time-intensive. A loss assessor can help with this full process by scrutinising your policy wording, and advising you on any issues that may affect liability, such as compliance with warranties and conditions. They will also work with your crisis management team and take part in practise runs to test that your crisis plans are effective and realistic – hence why it’s important to plan in advance.
They can also identify parts of the policy that protect against various setbacks. For example, it is common for major grocery retail chains to charge suppliers for costs incurred by the recall of their goods, such as removing products from shelves and the associated admin. If the insurer declines these charges, it is likely that the policyholder will lose their customer. Experts may be able to argue that these charges should be covered by the product rehabilitation term found in many policies because they will impact the business if they are not paid.
If the product recall is down to a supply chain issue, they will work you with and any supplier who may have provided a defective good, to make sure that the excess and other uninsured elements of the claim are covered.
Despite your commitment to being safe and offering high-quality goods, product recalls can still happen, especially when there’s a big supply chain involved and a myriad of places for something to go wrong. But don’t panic. Investigate the issue, report it, and handle it. If you follow the steps above, you’ll have a plan in place before it happens – and you’ll thank yourself later.
WHY 2020 IS THE RIGHT TIME FOR FS MODERNISATION
Chris McLaughlin is chief product and marketing officer at Nuxeo
Few would argue against the notion that the UK financial services (FS) industry is facing many challenges as both a new year and new decade begin. Uncertainty over Brexit, the potential threat from new competitors and Big Tech brands, and rising customer expectations are just some of the challenges facing the sector.
But for every challenge, there is also opportunity. Digital banking paves the way for greater service continuity, making it easier for banks to capture and analyse data (with consumers’ permission), reduced repetition of information collection, and delivering more of what customers want in terms of products and services.
By innovating with richer and more convenient online and mobile banking experiences, and by using technology to deliver smarter and more streamlined backend operations, traditional FS providers can roll out and execute services more cost-efficiently too.
But many FS firms have been restricted in their ability to innovate and realise such opportunities, due to the outdated and inefficient systems and applications to be found in many organisations. However, with many FS workers believing that the challenges the industry face could see their company lose customers in 2020, the time is ripe for FS firms to embrace modernisation.
The 2020 agenda according to UK FS workers
Nuxeo recently surveyed 501 UK FS workers that focused on the challenges, concerns, and opportunities facing the industry. The main 2020 FS industry challenges were Brexit uncertainty; cybersecurity threats and information or data breaches; physical branches closing down; the burden of increasing regulation; competition from Big Tech firms potentially moving into FS; and competition from new challenger banks.
Perhaps of most concern to the industry is the fact that 59% of FS workers in the study felt that these challenges left their organisation vulnerable to losing customers over the next 12 months. But there are signs that FS firms are adapting to the new market reality and embracing technologies such as artificial intelligence (AI) that can help them modernise and address such challenges.
Almost two-thirds of respondents claimed their organisations are committed to innovation, and more than half (58 per cent) believe that firms which use AI in creative ways make for more attractive employers. 68% of respondents say their organisation is already using AI for content search or is in discussion to do so, and 67% say the same for automating backend processes, suggesting that FS firms are alive to the value that can be achieved.
Transforming customer service delivery is also a key focus for AI ambitions, with more than one-third (34 per cent) of respondents saying their organisation is already trying out AI in this context. Chatbots, often used to improve the customer experience, are being used by one-quarter. Meanwhile, 41 per cent are already using AI-based capabilities for some form of data analysis, suggesting that FS providers are attuned to the need to target their activities more strategically.
Smarter management of data, content and information
One of the major threats to productivity is the inability for FS firms to connect and organise all the data they have at their disposal and there is a real need for smarter management of data, content and information. Compared to newer industry market entrants, established banks and FS providers have far richer data going back decades or longer. If institutions could tap into this considerable resource, it could be used to distil invaluable intelligence and insights into consumer trends, product performance, and relative account profitability.
Although organisations have all the underlying information stored within their legacy systems, it is typically very difficult for teams to access, combine and cross-analyse this data. This is because, too often, systems are unconnected, use incompatible data formats and feature considerable data duplication between applications.
In the Nuxeo research, FS providers confirm that, on average, they store information and content across nine different systems. And these systems tend to operate in silos: almost three-quarters of respondents say their organisation’s systems are not fully connected with each other.
System users who need to access information as a regular part of their jobs can be spending up to an hour a day (52 minutes) searching for what they need because it is not readily discoverable. Given that this equates to four hours 20 minutes each week per employee spent looking for information, the total time wasted across an organisation over a year is quite significant.
Embarking on a managed journey of modernisation
13 per cent of respondents in Nuxeo’s study believe their organisation’s inability to adopt AI quickly enough is one of the main challenges facing UK FS in 2020, so it’s something that will need to be addressed sooner rather than later.
But a managed modernisation journey, incorporating wider use of AI, which can help address many of the issues that are so concerning to those that work in FS, is already underway for many. Such modernisation can deliver quick wins, without incurring new risk or detracting from other critical work that needs to be done in 2020 and should be embraced wholeheartedly as the FS industry embarks on the new decade.
WHY MAKING MONEY ON YOUR MOBILE IS EASIER THAN YOU MIGHT THINK
Aaron Brooks, Co-Founder of Vamp
For Millennials and Generation Z, becoming a social media influencer is an increasingly desired career. According to a recent study, 86% of millennials want to use their social platforms to post sponsored content. It comes as no surprise. Getting paid to produce content about the products you love, why wouldn’t you?
It’s more than just a pipe dream too. While marketing used to revolve around big brands, employing big agencies to create ads, technological advancements have created a user generated content boom. Thanks to smartphones, most of us now have a 12 megapixel camera in our pockets. Brands have capitalised on this, launching campaigns that harvest user generated content, asking their customers to share their brand experiences through pictures, videos and reviews.
Social networks have normalised the sharing of content, which has helped propel this movement further. ASOS’ UGC hashtag #AsSeenOnMe has over a million entries on Instagram. Then of course there’s Apple’s incredible ‘Shot on an iPhone’ billboards, which use their user’s images to promote their phones.
Influencer marketing takes this a step further. These social creators produce high-end content and have engaged followings – both a valuable commodities for brands. 93% of marketers now using influencer marketing. So if you’re looking to make your mark as a content creator, there are plenty of opportunities. Don’t be put off if your Instagram following isn’t in the high thousands either. Micro influencers, with their small but highly engaged audiences, have become popular among marketers and this trend will continue to grow in 2020.
Of course, brands want high-quality content to represent their brand, but if you’re keen to kick start your creator career and start making money, a smart phone and a creative eye is a good place to start. If you want to take it further, then follow these three tips for success.
Hone your personal brand
Rather than trying to be fashion, art, foodie and travel all in one neat package, find a niche and create a consistent message. The same goes for photography styles. If you want to be the flatlay expert, I’d recommend sticking to that at least 80% of the time.
Finding your niche and making it your hallmark will let people know what they can expect from you. It’ll make you more likely to maintain follower loyalty and help you to stand out from the crowd. Make sure it’s of genuine interest to you. You’ll need enough enthusiasm to post consistently in order to build your authority in that area.
Cultivate an engaged following
While a high follower count was once the most prized possession of the influencer community, times have changed. These days if you want the attention of big name brands, not only do you need a beautiful feed, but a highly engaged following. That means people who follow you, spend time with your content and engage with it.
Actively engaging with your existing audience and contributing to the larger Instagram community will help you build relationships on Instagram. This means replying with genuine
comments and pro-actively engaging by offering your own comments on other accounts.
While it might be tempting to take shortcuts by buying fake engagement or followers, it will only sabotage your efforts. Software has become increasingly effective at spotting fakes so chances are, you’ll be found out and blacklisted.
Maximise influencer marketing platforms
Once you’ve honed your personal brand and cultivated an engaged following, you can begin making money on your mobile. Rather than waiting for these opportunities to find you, you can take a proactive approach and join an influencer marketing platform.
These technology services connect brands with content creators. Depending on the platform, it may have a database of thousands of pre-vetted influencers who have opted-in to receive content collaboration briefs from brands. You’ll get opportunities delivered direct to your mobile and will be able to choose whether you opt in or not. This gives you the freedom and flexibility to work with brands that truly resonate with you and balance the work around other commitments.
With brands constantly searching for people who boast content creation skills, there are plenty of career opportunities in the influencer space. For those looking to make money in this space, all you will need is a smart phone, passion and creativity to begin carving a career as an influencer.
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