• Ken Leung

Fundamentals of a great retail customer experience

‘Depending on which study you believe, and what industry you’re in, acquiring a new customer is anywhere from five to twenty-five times more expensive than retaining an existing one.’ (1).

A key part of retaining customers, and creating advocacy, is providing a good customer experience. We think there are 9 fundamentals that, if executed consistently well, can provide a good customer experience. Doing them really well can delight the customer with a great experience. Here are our thoughts.

1. Make your stores inviting

For a digital store interaction, the website needs to be aesthetically laid out to make customers want to browse and make it a convenient, if not a pleasurable, experience. This also means making the site easy to navigate on any device that the customer chooses to use. There’s nothing more frustrating than trying to navigate a poorly laid out site, especially when you’re trying to do so on a smart phone.

For a physical store interaction, having appealing visual merchandising, a brand appropriate atmosphere, relevant theatre, and don’t forget the ubiquitous free Wi-Fi encourages footfall and increases the chance that customers will stay longer to browse. Nobody wants to visit a drab and dated store, with unimaginative visual merchandising and badly designed lighting. Take, for example the Lego store with its modern look, clear layout and attractive themed displays that draws the eye. Then compare this to the Hamley’s flagship store in London which looks dated and less attractive in comparison. Another example is former Homebase which created an upmarket DIY retail experience with “personalised mood boards” and attractive displays of cushions, throws and other accessories from brands including Laura Ashley and Habitat. But almost overnight that unique selling point disappeared as their Australian acquirer, rebranded Homebase into Bunnings, ‘chucked out the chintz en masse and turned its stores into no-nonsense DIY sheds’ (4), to disastrous effect.

2. Make it easy to find the goods that you sell

A digital store needs to organise goods in a way that are intuitive for customers. An intuitively laid out site, not only makes it easier and more pleasurable for customers to browse, but also helps them to see the breadth and depth of the range. On top of this, a strong search capability to help customers pin point specific items and relevant alternatives eases the stress of locating an item quickly. Most companies have a text-based search facility which provide varying degrees of accuracy. ASOS has gone one step further by introducing image-based search, where customers can use the ASOS app to take a photo of an item that they like and use that to search for that item, or similar ones, on the ASOS site.

In a physical store, consideration needs to be given to plan the range and space to present compelling visual merchandising whilst making it intuitive for customers to find what they want. How often have you been in a grocery store and can’t find an item on your shopping list or a sales associate to ask ? Well, Walmart may have the answer. They’ve created a digital store assistant in the form of an app which they call ‘Search My Store’ that allows customers to locate any item that they stock in any of their 4,300+ stores.

3. Provide accurate product information

For digital stores, it is very important to provide customers with accurate images of each product together with rich information about their specification. Failing to do so, increases the risk that customers will be put off from buying a product or returning it because it didn’t look like the image that they saw, or not meeting their requirements. The implications are lost sales and increased distribution costs. Take a simple example of buying a book. Let’s say you like kimchi and fancied pickling your own. If you searched on WHSmith and Amazon, you are likely to find a book called ‘Asian Pickles’ by Karen Solomon. The key difference is that on whsmith.co.uk, you see a picture of the cover, no description and no customer reviews. Whereas the same book on Amazon provides not only an image, but a ‘Look Inside’ feature, a description, a number of customer reviews and books that other customers have also bought when they’ve bought this one (3).

Most companies provide crisp images from various angles. Some also provide videos. Amazon often includes promotional videos from the product’s manufacturer. Others, like ASOS produce their own videos. Some companies have gone further to leverage augmented reality technology on mobile apps to help customers visualise what their products would look like in the customer’s home. IKEA’s Place app allows customers to place 3D images of IKEA furniture in any room of their home to see how it would look. The fashion retailer, GAP, is using augmented reality technology to enable their customers to try clothes on virtually using their ‘Dressing Room’ app before they order.

In physical stores, grocery retailers such as Coop Italia are working on the supermarket of the future using the latest digital technology to give customers more information about their fresh goods. As customers browse and pick their items, digital information pops up on digital screens hanging over the shelves.

4. Provide accurate stock information

Companies need to be transparent about their stock availability to help customers decide on whether or not to buy. It’s very frustrating for customers to place orders for goods online only to be told later that either it’s out of stock or they are given grocery substitutes that they don’t really want. Equally, customers shopping in a physical store are often frustrated when they can’t find items in their size and can’t find a salesperson to check, especially when the store is busy. If customers can check availability for themselves, either on an in-store device or on a mobile app, and even reserve or place an order for an item in their size, then this could surely enhance the customer’s experience. Most companies allow customers to check stock availability in any of their stores online, but Boots have gone a step further by equipping their sales associates with mobile devices to better serve customers, including checking on stock availability.

5. Make it easy to transact

Once customers have decided to buy, they want to be able to transact with minimal fuss. Cumbersome in-store processes, poorly configured point-of-sale systems, poor product labelling can frustrate customers and create queues at the till. There’s nothing more off-putting than long queues in a store. So, it’s important that physical stores are able to dynamically manage their workforce schedules to redirect their staff to respond to intraday peaks to deliver a good customer experience. Customers find it frustrating to see staff replenishing shelves, folding clothes, moving empty cages to the back of the store, and other similar activities, when there are long queues at the tills that are not fully staffed.

Amazon has transformed the in-store shopping experience with their Amazon Go stores, where customers can scan items using an app on their mobile device, pay using the same device and leave. No queues and no checkouts! The Chinese e-commerce giant Alibaba Group and US carmaker Ford may have gone one step further by opening a ‘car vending machine’ in China’s southern city of Guangzhou. The five-storey building houses over 40 cars of various models and allows customers to see, test drive and buy the vehicles via Alibaba’s online shopping platform Tmall (2).

In-store customers are able to walkout with their purchases, whereas online shoppers have to wait for their goods to be delivered. Making it easier to transact means that customers are able to select delivery slots that accommodates their schedules. It also means making it easy for customers to return items that don’t meet their expectations. Zara allows customers to return unwanted items by selecting the day that they want a courier to come and pick up the returns from the convenience of their home. No need to take returns to the post office and potentially wait in a queue.

6. Provide accurate and timely tracking of customer orders & usage

After customers place an order online or in-store, they typically want to know exactly when their order will arrive so that they don’t have to sit around waiting for it. Telling a customer that their order will arrive sometime on a particular day is no longer a great customer experience. Amazon Prime Now offers 2-hour delivery on thousands of everyday essentials and household items within certain postcodes.

If 2-hour fulfilment and delivery is not possible, providing an estimated time of arrival (ETA) and allowing customers to track their orders in real time helps to maintain a good experience (assuming you are able to meet your ETA!). Providing a robust tracking facility will also help to reduce the number of contacts made by customers who want an update on their delivery, therefore freeing up customer service agents to deal with more pressing customer issues. Both Pizza Hut and Dominio’s provide apps to enable customers to track every stage to their order.

For service providers, helping customers track usage of their service can also improve the customer experience. The telecom and internet service provider, Three, provides customers with an app to allow them to track mobile phone usage against their plans. Similarly, Npower provides an app that allows their customer to track gas and electricity usage.

7. Make it easy to get help

For digital stores, it is very important to provide a clear and accessible route for customers to access help when they need it. The worst place for a customer to be is that things have gone wrong and they’ve ‘fallen out of the process’ or ‘happy path’ and they can’t even find a contact number. By offering a route to customer services via chat or phone allows the customer to get help. However, it’s even more important to underpin that route with customer service agents who are available, knowledgeable and have the right attitude. It’s no use providing a helpline or chat if it takes an hour for an agent to answer the call. When they do answer, you need them to have access to the knowledge that will help them resolve the customers query or issue in one call or chat, not passing them from agent to agent, each time starting the whole conversation from scratch. If they can’t resolve it in one call or chat, you want the agents to have a customer focused attitude, so that they are willing, recognised and rewarded for going the extra mile. What can quickly erode the brand experience, that you’ve invested a lot of money on, are staff who just have the wrong sort of attitude.

It’s the same in physical stores. Retailers need to make staff available, with the right knowledge and a customer-focused attitude. Boots, the pharmacy chain, have deployed a mobile app for store associates to help them find products for customers. The app uses the website's product database as well as analytics to quickly show product information, ratings and reviews, as well as look up inventory in store and online.

Providing self-help is particularly important for services. YouTube videos abound with an array of ‘how to’ guides. Service providers, like Wix, are using this media to great effect to help customers help themselves.

8. Make your customer contacts relevant

In today’s environment, your attention is highly sought after. Everyone is vying for your attention. Your colleagues at work, retailers that you’ve subscribed to, service providers looking for a renewal of their service, news bulletins, social media updates, alerts from your smart home devices, the annoying bundles of unsolicited email and those that land on your door mat every morning. The list goes on.

A lot of the communications that customers receive is pushed onto them and so much of it ends up in either the virtual or physical bin. What retailers need to do is to carefully target their ‘push’ communications to create a pull. That is, retailers need to think about what they can do for the customer rather than only think about what the customer can do for them. This can mean giving something for free. Companies like 24Slides regularly send customers free presentation templates, to build a relationship. Garages often send out MOT reminders to their customers in the hope that they will be rewarded by custom. Wix provide free web building tools and hosting to entice customers to transitioned to a paid service when they decide to go live with a personalised domain.

Relevant rewards based on customer buying habits also create a pull. It makes customers feel appreciated and pulls them to take advantage of tailored promotions. Supermarkets such as Tesco have been doing this very successfully for years.

9. Keep customer information safe

In the Information Age, there is nothing more valuable than information. Even your bank balance is essentially information on a bank’s computer. Keeping a customer’s information safe is a ‘sacred covenant’ between you and the customer. They trust you to keep their information safe. Nothing hits credibility more than when a customer finds that their personal information has been compromised.

Finally …

Technology will continue to change how we create and deliver a great retail customer experience, but we believe that the 9 fundamentals of what we need to do will remain the same. That’s what we think, but we welcome your thoughts.


Ken Leung and Chris Bevan are Co-founders Outvie Consulting.

References:

1. ‘The value of keeping the right customers’, Amy Gallo, Harvard Business Review, Oct 2014 (https://hbr.org/2014/10/the-value-of-keeping-the-right-customers)

2. ‘Alibaba opens China’s first ‘car vending machine’, RT, March 2018 (https://www.rt.com/business/422857-alibaba-china-car-vending/)

3. Correct as of 1st April 2018

4. ‘Homebase is the most disastrous retail acquisition in the UK ever’, Zoe Wood, The Guardian, March 2018 (https://www.theguardian.com/lifeandstyle/2018/mar/30/homebase-is-undoubtedly-the-most-disastrous-retail-acquisition-in-the-uk-ever)

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