Communicating bad news is hard, a fact brought home – literally – in the shape of a curt letter from my son’s nursery, informing us our monthly fees will increase by an eye-watering 20% next year.
For most parents, childcare is a complex, emotive and financially consequential matter, so I was surprised that this particular missive focused on the ‘what’ – i.e. you will be significantly worse off – without any explanation of ‘why’ fees are rising so dramatically, or ‘how’ the extra cash will be used.
Also lacking was context. This organisation fell into the trap of communicating as if it exists in a vacuum, when the reality is that a range of external factors are at play in childcare sector funding.
When advising our clients during crisis comms workshops or messaging sessions, we say corporate reputation is driven by two core factors – fulfilling core services or functions well, and communicating effectively and transparently. In many cases the former is horribly undermined by the latter, which seems to be the case here.
We live in an age of instant feedback, easy access to information and almost endless data, which exposes corporate vagueness. My expectation of detail in the aforementioned letter was particularly acute, given the same organisation prides itself on its ability to give us real-time updates on our son’s every bowel movement.
To be clear, the day-to-day nursery staff are fantastic, and I hope the vast majority of the fee increase is going to them, rather than merely underpinning the “favourable market and industry dynamics” the group highlights in its latest investor presentation.
This, of course, is another communications challenge that can be underestimated by organisations with regulatory reporting requirements. Your customers and investors do not exist in distinct, parallel universes – upbeat presentations to investors can easily be found and read by squeezed consumers.
It is often the case that customer-facing staff, despite fulfilling their end of the reputational bargain, end up absorbing negative feedback triggered by decisions made by senior executives in far-away boardrooms. This can result in a double reputational blow of annoying customers while denting employee morale and trust.
Childcare is a perennially delicate topic, domestically and politically. Earlier this year, 70% of British parents surveyed by UNICEF UK said raising children under the age of five is getting harder each year.
In Scotland, the first minister, Humza Yousaf, put an expansion to free childcare front-and-centre of his leadership campaign. In the September programme for government, he said: “this government also recognises the crucial role of childcare, in helping parents to return to work – benefitting not just them, but the wider economy.”
But what followed was vague, at best; “we will accelerate the next phase in our expansion of childcare for families with two-year-olds, reaching thousands more families.”
I am yet to meet anyone who really knows what this means, beyond the expansion of trials in a few pilot local authority areas, even as the Scottish government maintains its funded childcare offer is the “most generous in the UK”.
Of course, it’s not just the Scottish government that funds childcare. Many working parents use the UK government’s “tax free childcare” scheme. It is styled as paying 20% of childcare costs. What is less prominent is the cap of £2,000 per year per child, some £967.20 short of what would be needed to make up 20% of the £14,836 average annual childcare bill in 2023.
This gap is unsurprising given the cap hasn’t changed since the policy’s introduction in 2017. According to the Bank of England’s calculator, if it had risen in line with inflation alone, the cap would stand at £2,554.11 today.
All of these challenges, and wider issues around the rollout of free hours, are emphasised by various industry associations and larger childcare provider groups in their interactions with government. I do sympathise with them, but they would do well to consider their communications to hard-pressed customers as carefully as they manage their lobbying, to avoid longer term commercial and reputational damage.
With the right context and communication, the reputational impact of something that has a significant consumer impact, like a rapid fee increase – if truly unavoidable – can be managed in a way that at least helps audiences understand why it is happening, and even how they could play a role in advocating for change within the systems that influence it.