Research indicates that a four minute wait at a grocery store line can jeopardize customer loyalty. Shopper’s satisfaction remains high when in line four minutes or less in all store categories. Club stores are the only exception where an average wait time slightly over four minutes was accepted. One study found that 43% of consumers said long lines would affect their decision to shop a particular retailer in the future.
There was a recent discussion on retailwire.com about self-service transactions. Transactions at self-service kiosks are expected to top $607 billion this year and grow to over $1.7 trillion by 2012. Retailers love self-service kiosks because it can significantly increase customer loyalty and customer satisfaction while reducing labor costs.
Self-service kiosks are great for those customers who want to be in and out of a store. There are shorter lines and less hassle. Or is there really less hassle? My experiences have been mixed. Sometimes the self-checkout system does not cooperate and that’s when things can become frustrating. Usually there will be one attendant watching over six machines. Consider yourself pretty lucky if the attendant is not helping out anyone else and can assist you right away.
Two weeks ago, I was at a grocery store picking up eight items. I started scanning items and then a glitch happened. I quickly started looking for the attendant who was helping another person. I had to wait maybe another 3-5 minutes as the attendant helped a first time self-service kiosk user. Retailers need to have adequate help for these self-checkout systems.
Will cashiers disappear by 2012?
There will always be cashiers. Self-service kiosks are great for quick service but cashiers can be a great opportunity to gain competitive advantage. Staff can provide extra customer service or promote and sell specials at the cash register.
U.K. supermarkets Tesco and Asda will cut the costs of thousands of everyday groceries in a move that threatens to start an all-out supermarket price war.
Grocery bills have sky rocketed in the past year and MySupermarket.co.uk claims that a typical family faces a £1,000 rise in the amount it spends in supermarkets over the coming year.
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Internet grocer Peapod is teaming with marketing firm Concept Peapod to Offer Online Shoppers Personalized Discounts Internet grocer Peapod is teaming with marketing firm Concept Shopping Inc. to deliver pre-selected savings for all Peapod shoppers based on their needs, and preferences, saving time and money on each shopping trip.
“Progressive retailers like Peapod realize that shopper loyalty comes from understanding and working to support the unique needs and preferences of each shopper,” says Joe Battoe, Concept Shopping’s CEO. “Pre-selecting relevant offers that help shoppers save more is a great way to increase value and convenience for Peapod’s shoppers and demonstrate Peapod’s loyalty to its customers.”
Fleming’s Prime Steakhouse & Wine Bar has found a way to help customers battle rising food costs. The restaurant chain has created a site called LeftoverSteakRecipes.com for tips and ideas into turning last night’s leftovers into today’s breakfast, lunch or dinner.
Bartenders, waiters, hair stylists, cab drivers, and other workers who depend on tips for much of their income are seeing decreases in their tips as customers struggle in the current economy. There is some help at the state level. For instance, the Delaware Senate approved a bill this month that would raise the minimum wage for service workers and others who depend on tips.
What can service workers do to improve tips?
When times are tough, service workers need to pay special attention to customer service. Happy and satisfied customer can lead to higher tips.
While other retailers continue to close doors during the economic downturn, Forever 21 continues to expand around the globe. The Los Angeles company has sales of more than $1 billion a year. There are plans for a 90,000 square feet store in Times Square next year. The store will have three levels and will be larger than the size of the Rose Bowl playing field. The retailer also plans to build a mall adjacent to Inchon International Airport in South Korea.
By focusing on the trend-hungry, cost-conscious young woman, Forever 21 has built a $1.8-billion business. In the future, Forever 21 hopes to be a comprehensive fashion department store chain, selling clothes and accessories for teens, women, men and children.
What are retailers doing to increase sales? One strategy is offering deeper discounts. Nordstorm has slashed prices, starting at 40%, vs. 33% last year. While Nordstorm is offering deep discounts, other retailers are going after a different customer segment altogether. Earlier this year, Old Navy began pitching their clothing at twentysomethings. Now, their ideal customer is the budget-conscious mom shopping for herself and her family. When retailers realize slashing prices and targeting different customers altogether is not enough, what else can they do? Perhaps teaming up is the answer. For instance, retailer Macy’s has teamed up with FAO Schwarz to bring toys back to its stores.
Do price cuts work?
Yes, price cuts work in the short-term, especially during hard economic times when consumers are ultra price conscious. However, one problem retailers might face is that consumers will get use to the lower price points. Even when the economy does improve, customers might not be willing to pay full-price for items.
As a long-term strategy, price cutting does not work. One problem retailers might face is that they start a price war with competitors. Once this happens, prices will keep on dropping and no one wins.
A study by NCR Corp. revealed that 86% of U.S. and Canadian consumers are more likely to do business with a company that offers self-service. In addition, 66%
of survey respondents said self-service technologies create a more positive perception of brands.
This week, NCR Corp unveiled a newly designed kiosk at the 2008 Hospitality Industry Technology Exposition & Conference in Austin, Texas. The XpressPort kiosk allows guests to perform a number of tasks, such as checking in and out, printing room keys, locating and modifying reservations, and viewing and printing messages.
Rising fuels costs and the economic downturn have caused many to become price-conscious shoppers. Bargain hunters are flocking to discount stores for items such as cups, napkins, and paper plates.
By 2011, nearly 35,100 stores are projected nationwide (up 1,665 from 2006) and sales are expected to reach $50 billion, according to TNS Retail Forward’s “Industry Outlook: Dollar Stores and Other Small-Format Value Retailers.” In the future, shoppers can expect to see expanding food selections and different payment options to improve the overall customer experience.
