March 14, 2016

Come On Retail, Retaliate!

Sir Charlie Mayfield, chairman of the British Retail Consortium, warned last week that the retail sector is facing the loss of up to 900,000 jobs and thousands of shop closures in the coming decade. This in part due to the new apprenticeship levy and the rise in the National Living Wage. Over in Europe things aren’t much different, with Swiss retailers in particular feeling the pinch due to the strong franc and the ease of buying the same product in the Eurozone at much lower prices. 

So is it all doom an gloom for the retail sector? Well, we think that depends on how it responds. If things continue the way they are, Sir Charlie may well be right. But if retailers respond by making a strong move to improve customer experience, they could well rise above these challenges. Note, not just a small improvement: a significant one. 

To illustrate the point, here are a few of my recent retail experiences:

Our washing machine finally bit the dust, so I walked into the local electrical goods store as a very hot prospect. The 3 team members at the store were more interested in talking among themselves than serve the one customer in their section. I finally managed to tear one of them away from their conversation only to be warned that the machines I was looking at typically took 3 hours to complete a cycle, so my wife might not be happy. I then had to ask for options with a short cycle. After a lot of searching the team member recommended a couple and then walked back to the conversation I’d interrupted. Result: no sale.

In a ‘remote’ retail experience, I needed to buy my son some specialist sports clothes. There’s only one retailer that stocks what he needs, and we live 3 hours’ drive away, so I decided to order via their website, like so many people do these days. The trouble was their website consistently wouldn’t load, timed out, and then finally when it started working (a few days later) the product didn’t show up when I searched for it. I couldn’t find it anywhere on their site. And then the site went down again. When it did work, it didn’t adapt to mobile or tablet screens, and with the growing number of people accessing sites via mobile devices, this is not good enough. Overall not a great experience.

So I called them to place the order. The lady who took my call was very pleasant and sent the goods out the same day. Great I thought. Except when the clothes arrived the sizing was way too big (despite them being the same size as all the other clothes that fit him perfectly). 

A quick check on sizing at the manufacturer’s website showed the cause of the problem. The manufacturer equates size 12 to 151cm tall, but in their wisdom, the retailer converts it to 140. Go figure. This is a value subtraction, not value add.

Now the retailer has been very good in dealing with the return, but what a hassle. If this is the sort of experience customers have, is it any wonder there’s a strong tendency to do your own research and then simply buy online.  I could most likely have sourced the product from far away overseas more quickly and precisely than via a local specialist, and sadly this seems to be all too common.

In another situation I had to take some equipment into a shop to be adjusted. The guy complained that the screws had been tightened too much. When I pointed out that it was him that had tightened them in the first place, he swore blind that it couldn’t have been him. Oh please! I shan’t be going back there again.

 “Retail – and other service sectors – must recognise that the future winners will be those businesses that differentiate on Customer Experience, not on product or price.” Stephen Spencer

All this is not to say that there aren’t some great customer experiences out there. Rather that it’s not consistent enough, and the general trend drives customer expectation. With the digital age, consumers are more free and able than ever before to choose where, how and from whom they buy, so as Customer Experience expert Stephen Spencer says, “Retail – and other service sectors – must recognise that the future winners will be those businesses that differentiate on Customer Experience, not on product or price. ”

So what does this require of retailers - and indeed the service sector in general? 

Not, we suggest, the current general trend, which seems to be to cut costs, squeeze margin from suppliers and link up with other complementary retail providers (for example Sainsbury’s + Argos). We’d argue that retail productivity (increased sales, long term) is led by improved customer experience, which is best created by businesses whose business model is centred on customer experience (not just a bolt on) combined with engaged employees with the skills needed to do the job. 

Thankfully there are some companies that are bucking the trend: 

  • ‍Sharp (the furniture retailers) have a new customer experience-led store design which is generating 30% increase in sales.
  • Samsung has a new flagship ‘digital playground’ in Manhattan where consumers can try out Samsung products and experience the brand. People who already have Samsung Galaxy phones can use them as tickets for entry to special live events there (nice to see existing customers getting a bonus, rather than the all too typical “offer only available to new customers only”).
  • Rather like Value Stream Managers in Six Sigma-focussed organisations, businesses that are forging ahead with creating great customer experiences have a ‘Chief Customer Champion’ whose job is to maintain an unrelenting focus on the customer throughout the organisation.

The key here is that the shift towards creating great Customer Experiences is a strategic one. If you’re not already thinking about this now in your organisation you’ll soon be playing catch up, so do get in touch if you’d like to know more about how to prepare to meet future customer expectations.

Other Posts

Gang fights, Bridges and Beer
What have gang fights, bridges and beer have in common? Read on and find out #OpenYourWorld
Habitual Power
Habit is the breakfast of champions, but also the undoing of us when we unconsciously get sucked into less than useful habits. So where’s your focus (consciously and unconsciously)? How about the company where you work? What patterns do you notice? Are you a habitually busy person, rarely able to find time to do the important things you know you should? Do you get sucked into the busy-ness of others?
Customer Experience
What an Experience
How's the customer experience with your company? How easy is it for them to do business with you? How do you most want your customers to feel while doing business with you? Anxious, uncertain, annoyed, frustrated? We guess that’d be a no. Yet there are still so many businesses that continue to generate these feelings in their customers.
Inside Out
The Ultimate Accountability Model
We’d like to suggest that the key to solving the angst about migration is to point people to the source of their experience. When countries and individuals realise that their anti-refugee stance is not caused by things that happen on the outside that they may feel a victim of, but by what’s going on with their thinking, then there’s hope.
Customer Experience
What Gets Measured Gets Experienced
You’ve no doubt heard the expression ‘What gets measured gets done’, an adage which seems to hold true because the things we’re measured against typically drive our focus and behaviour. We’d like to offer a slight - but important - adaptation of this: what gets measured gets experienced. Bear with me on this: I’m not sure if it holds true all the time, and I’m sharing something here that’s still in its formative stages. However, as customer experience is becoming more and more of a differentiator amongst businesses I think it’s well worthwhile trying this modified mantra on for size.
Culture Change
Done Lean - Six Sigma? Didn't really work?
Lots of companies say they’ve ‘done’ Lean, ‘done’ Six Sigma, and with this there’s very often an associated ‘and it didn’t really work for us’ attached. When we probe a bit further, it soon transpires that whilst they had a go at it, there were lots of required ingredients that weren’t in place, and naturally, rather like baking a chocolate cake without the chocolate or cocoa, the result didn’t meet expectations. Want to get the best from applying Lean - Six Sigma in your business? Read on.
Customer Experience
Small Words, Big Impact
Changing small words can have a big impact on outcomes. Discover some of the helpful recent findings from the world of Conversational Analysis, particularly applicable in the worlds of customer experience, negotiating, sales and general consulations.
Inside Out
The Curious David Bowie Effect
Fundamentally, this is what’s behind everything that prevents us realising our full potential: things like stress, overwhelm, anxiety, office politics, levels of busy-ness, baggage from previous encounters and so on. The performance of an organisation is a function of the quality of its people’s thinking. When the quality and clarity of thinking improves, great things happen.
Culture Change
Bringing About Organisational Change
An interview with Alastair Olby on bringing about change in organisations. When do traditional methods work, and when could you be making life easier by taking more of a cutting edge approach?
Customer Experience
To Delight or Not Frustrate? That is the Question
There’s a world of difference between a customer experience-focussed company and a customer service-focussed company: it’s a profound cultural difference, and to make the shift from one to the other isn’t necessarily easy, but it IS possible.
Graphic Recording and Groups: how much value does it add?
As a professional facilitator I’m very aware of the importance and value of visually summarising what’s being discussed by groups, but at the recent European International Association of Facilitators’ conference an interesting question arose. It seems to have become best practice to have a graphics expert work alongside groups to create a visual summary of what the group discusses. However for some it's not always easy to recall what's depicted. So what should we do?
Customer Experience
What Have Dignity And Respect Got To Do With It?
Recently a large organisation we work with launched a Dignity and Respect workshop for its staff. Why? Well customer feedback suggested that this was an area for improvement. The workshop took 90 minutes and underlined why it's so important for customers to be treated well, and the sorts of behaviours that are expected of the organisation's staff. The result? Fuming staff. Read on to find out why.
I'm Honest, Right?
The one thing followers most want from a leader is honesty. Honesty ranks head and shoulders above all the other wants of followers. It's the number one thing to get right, yet many leaders in large organisations inadvertently create an impression of dishonesty. Read on to find out how this happens.
Culture Change
Are You Ready For The Inclusion Challenge?
Did you know that despite the economic gloom around much of the world, at the moment engineers are in short supply? With emerging markets' need for qualified, skilled engineers, many organisations are having to re-evaluate their approach to recruiting and retaining talented staff, casting the net far wider than before. This then creates challenges with ensuring people from very different backgrounds feel included in the workplace.
Culture Change
Are Meetings Taking Over Your Life?
So many people are finding there's precious little time to do their normal job after all the meetings they have to attend. Read on to find out how come core principles for meetings can make a big improvement.
Are You Working For A Psychopath?
Surely not! But wait on a minute. Recent research for the film 'The Corporation' concludes that the closest character definition of a typical corporation is that of a psychopath. So can working within organisational values result in decent people doing things which are collectively harmful?
Customer Experience
Is This The Same Hotel?
Do your customers experience variation in the quality of your service or product? In the age of the experience economy, and the need to focus on customer experience, not customer service, this is such an important area. How does your company stack up?