As Marks and Spencer continue to suffer through one of the worst cases of cyber disruption in recent memory, all eyes are on their response and whether the fallout from the attack will continue to hit their bottom line in the long term.
We wanted to see just how much of an effect a cyber-incident of this scale can have on an organisation, even one as established and reputable as M&S – and whether a brand’s reputation can actually help them to better survive an attack of this kind.
Read the results of our snap polling below.
The currency of trust
This cyber incident will not be without consequences for M&S. However, whilst sales and customer perception will take a short-term hit, our research has shown that M&S has enough corporate reputational ‘credit in the bank’ to weather the storm in the long run, as most are likely to give them the ‘benefit of the doubt’ over the issue.
But this does not mean that short-term sales and customer volumes will not be impacted. We have observed 25-33% of shoppers saying they would shop elsewhere if unable to shop online at M&S and are currently less likely to recommend M&S to others.
M&S is here to stay, but sales figures will show a big hole during the impacted period, as some online shoppers migrate elsewhere.
Will customers forgive and forget?
Comparing pre/post the cyber incident, there is some evidence that M&S reputational perception has weakened at a ‘top box’ level, but overall it has held up remarkably well despite the major, well-publicised, operational issues…
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A 7% decline (from 39% to 32%) in consumers saying they ‘Definitely would’ give M&S the ‘benefit of the doubt’ if it were faced with ongoing product or service issues
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However, there is no significant difference in top 2 box saying ‘Probably/Definitely’ (84% pre v 82% Post) would give M&S the ‘benefit of the doubt’ if it were faced with ongoing product or service issues, indicating the decline is not catastrophic – and is recoverable.
A challenge to brand advocacy
M&S have suffered a decline in brand advocacy due to the cyber incident, with significantly fewer likely to recommend M&S to others…
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There has been a decline (87% Prev 73% Post) in those saying they Probably/Definitely would recommend M&S to others
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However, the greatest shift is from ‘Definitely’ to ‘Probably’ would recommend, again suggesting that M&S retain some customer loyalty and advocacy
What does this mean for M&S’ future?
Most indicate they would stick with M&S, particularly among those that have tried to shop online with them during the incident. However, a notable minority choose to shop elsewhere indicating sales will be impacted in the short term
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There are 25-32% of occasions when customers will shop (online or in-store) elsewhere, signalling a temporary but notable impact on sales and share shifting to competitors to competitors in the short-term
Ultimately, our research has indicated that brands that have built strong consumer trust over many years, may likely be in a better position to weather the storm of even the most ferocious cyber-attacks, than organisations where trust and customer loyalty is already fragile.
However, in a world where consumers have so much choice (both online and in-store), even the most celebrated of brands can start to see their customers move to competitors, if supply is disrupted. Then, it quickly becomes an issue of communicating effectively and fixing the issues, before the ‘currency of trust’ runs out.
Three key take outs
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It’s vital to invest in your customer experience and your brand, to ensure you have customer goodwill ‘in the bank’, for when things go wrong
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In a crisis, accessible, timely and authentic communication with stakeholders is key, because customers and media will quickly fill any vacuum with alternate narratives
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Make sure you have a plan for the worst-case scenarios, so you’re not thrown off course by a crisis
Maru is here to help you shape a market leading customer experience, as well as ensuring your communications are designed for every eventuality.
To discuss any of the above in more detail, please don’t hesitate to get in touch.
