As its talisman chief executive Mike Ashley prepares to step down from the leadership of Frasers Group, new data from YouGov finds the retail empire’s brand reputation in a parlous state.
Mike Ashley, the founder of Sports Direct, chief executive of Frasers Group and pantomime villain of the British high street, is stepping down as leader of his retail empire. But as he prepares to hand over the throne to his son-in-law, YouGov data suggests the brand he built may struggle to recover its reputation any time soon.
According to data from YouGov BrandIndex, consumer perceptions of Sports Direct (Frasers Group’s principal high street presence) have been largely negative for over five years. The findings suggest that Ashley’s public persona, as well as revelations regarding poor working conditions at the company, have wounded its reputation in the long term.
Impression scores for Sports Direct were last positive (0.3) in April 2019. Revelations about working conditions at the retailer, which culminated in Ashley’s 2016 appearance before a parliamentary select committee, seriously damaged its public reputation. MP Iain Wright claimed at the time that the retailer’s working pratices were ”closer to that of a Victorian workhouse than that of a modern, reputable high-street retailer”.
Consumer attitudes regarding product quality at Sports Direct have also fared poorly. With a 2016 nadir of -21.3, consumer attitudes have remained negative for over seven years, reaching only their highest (-7.8) last March.
Sports Direct’s deleterious reputation has also damaged the other brands within the Frasers Group umbrella. Following Ashley’s takeover of the upmarket House of Fraser, which followed that company falling into administration in 2019, consumer perceptions of that company have also sunk.
Reacting on the YouGov data, Caroline Parkes, chief experience officer at Rapp, said it reflected a wider change in consumer attitudes to businesses not seen as sufficiently caring. ”One of the lasting effects of Covid is that consumers’ eyes have been opened to how companies treat employees. While monetary good value has always been key in consumer decision making, Rapp’s Value Levers Research shows a dramatic increase in the importance of how a business treats its people and cares for the broader community.”
Parkes continued: ”Sports Direct has been criticized for treating ’workers as commodities rather than as human beings’ by a government report in 2016 – paying them less than minimum wage, not allowing basic human rights like loo breaks and fresh air, and being asked to break furlough rules by working. So unsurprisingly the brand’s reputation is translating into falling sales. Customers don’t just care about cheap trainers, they are drawn to companies who give their customers and staff positive experiences.
”As he hands over the reins to his future son-in-law (a grand gesture in nepotism and misogyny all in one) I don’t think this man will be at all missed by the industry or his staff.”