Customer Experience Synonymous with Operating Strategy

When you hear the term “customer experience”, what is the first thing you think of? Many think of marketing or sales, but how many think of operating strategy? Others immediately think of the expense of running a customer service department. What is often missed is the growth potential and stability of adopting the customer experience into every operational function and decision.

This story on CRM.com discusses the subtle, but very important differences achieved in giving the customer experience a high profile in your day-to-day operations. Here are a few of the major points:

It is true that the customer experience has a lot to do with sales and marketing, but to limit it to these silos is to miss the larger point. Everyone in your organization is a touch point to the consumer.

It’s also true that the customer experience reflects the emotions or feelings of your consumers. However, there are also tangible elements like contract clarity, financial options, web support, or even something as simple as the ease of transporting your product.

There are those who believe customer experience is a “tradeoff to profitability.” This “necessary evil” attitude is misleading. A healthier viewpoint is to see your operations as a mean to solving your customers’ problems. The better you can do this, the more profitable you will be.

The truth is that there is a grain of truth in every attitude toward the customer experience. The only trouble is that many of these approaches are incomplete. Try thinking of the customers’ need in all phases of your operation.

Making the Promises Real in 2010

Many are seeing 2009 as a breakthrough year for efforts designed to raise the profile of the customer experience. There is growing evidence that the everlasting pledge to put the customer first actually got beyond lip service and into real and actionable tactics. With the progress made last year, even in very tough economic circumstances, 2010 should see the movement gain even more momentum.

An article on retailcustomerexperience.com offers the following advice as brand marketers and retailers continue to travel down this road:

“Drop the executive commitment facade.” Executives need to “put their money where their mouth is” with time, treasure and talent. If it’s a real priority, they will manage customer experience like they do financial results.

“Acknowledge that you don’t know your customers.” The means to truly knowing the customer does not lie in a long and drawn out marketing research project. Establish a “voice of the customer program” for a quick, ongoing and continuous dialogue with your customers.

“Keep from getting too distracted by social media.” Social media should be an important “listening post” in your efforts, not the end all and be all. Other listening posts include surveys and call center calls and other customer touch points.

“Stop squeezing the life out of customer service.” By measuring how well your customer service organization serves the consumer instead of using efficiency metrics, you can turn this necessary evil into a strategic asset.

“Restore the purpose in your brand.” A true brand is more than just your logo. It’s a promise that you make and keep with your customers at every transaction. Your raison d’être should be apparent in everything you do.

“Don’t assume employees will get on board.” When you announce your new customer experience initiatives, expect a good amount of eye rolling from your employees. It’s critical to sell them on why this is so important and engage them to participate in how to make improvements.

“Translate customer experience into business terms.” Develop a model that measures the direct impact of customer experience on brand loyalty. That number can help bridge the understanding gap among employees and engage the accounting department as to a tangible financial impact.

How Fresh and Easy Listened to the Customer

Tesco’s Fresh and Easy concept in the U.S. provides a vivid example of a company listening to the customer and making almost immediate adjustments based on that feedback. It has been almost two years since the stores started to appear on the West Coast. In that time, the company has, “done a lot of listening to customers.” This interview with Steve Ryder, Store Design & Planning Director at Fresh & Easy Tesco’s US operation, outlines some of the activity.

Based on customer feedback, 60 stores engaged in a re-fresh program in which stores were made more inviting and informative. Additional banners, more messages and more color was used to address what the customers were calling a “sterile” environment that made the stores appear to be “too discount” for the U.S. shopper.

After 18 month in operation, 120 stores were remodeled this year to take advantage of the learning accumulated over that time. Frozen food space was increased and 600 skus were added by increasing aisle height by 10 inches. Store décor was changed yet again.

Change is never easy, but it appears that Fresh and Easy has broken through the anxiety by creating a culture that listens, and more importantly, responds to the customer. Look for this chain to continue to enhance its presence in the U.S.

Raised Stakes for Customer Service

A survey conducted in the UK found that the younger the consumer, the more likely they are to leave a brand or company due to poor customer service. Research by Genesys Telecommunications Laboratories along with Datamonitor and Ovum found that each generation of consumers has a different and heightened idea about what good customer service is and should be. In business, it’s said that if you aren’t growing, you’re dying. Based on this research, the same can be said for how you interact with your consumers, both now and in the future..

An article found on callcentrehelper.com discusses research that found consumers from age 27 to 43 are 60 percent more likely than those over 44 to abandon your brand, store or offering due to poor customer service. Clearly businesses need to not only continuously raise their service levels to meet the heightened standards, but they must also increase and augment their understanding of what the consumer identifies as a poor, reasonable and excellent customer experience. When customers are walking away from sales, failure to understand and manage the expectations can cost millions in lost revenue, repeat sales and diminished brand equity.

The research cites several current expectations. Among them were proactive engagement when using contact channels and better integration of those channels to allow for flexibility and personalization. Whether it’s in the UK , the USA or the rest of the world, the bar is rising on customer service expectations. Do you know what your customers are thinking?

The Sin of Omission

The customer experience is a multi-faceted and sometimes complicated opportunity for brand marketers and retailers. But in many respects, it is remarkably simple. A survey was introduced today that reports more than 25 percent of the time, customers feel ignored. If true, this is a call to action for all involved. We must train store and service personnel to proactively see service opportunities.

The survey, reported on by the Chicago Sun-Times, by the SALT & Pepper Group measured 1,027 interactions between customers and salespeople in 73 retail stores over a four month time frame. The study said that electronic and hardware/home improvement stores were slightly better than other channels. Luxury retailers, who you would assume would be at the top of the ranking, fell somewhere in the middle.

The SALT & Pepper Group identified, “the sin of omission,” as a big problem that they encountered when entering a store. In a nutshell, the associates working the registers or aisles simply would not recognize or acknowledge the customer. It seems like a simple thing, but when it comes to training and educating store personnel on customer service, we must not commit, “the sin of omission,” in including this basic concept.

Consumers Craving Gift Cards

The National Retail Federation tells us that gift cards are again finding favor with consumers who enjoy the flexibility of selecting their own merchandise at participating stores. The NRF says that gift cards are preferred by 55.2% of adults as a holiday gift. They choose this gift ahead of clothing, books, DVDs and electronics.

Christina Veiders, Managing Editor of Supermarket News, writes how retailers, realizing that the old idea still has some life, are using gift cards as not only a sensible gift idea, but also as a means of sales promotion. The technology behind gift cards takes an old idea, the gift certificate, and gives it new life because they are cheaper to produce, easier to track and provide a long lasting branding opportunity. Consumers love the convenience.

After taking a dip last year because of retail bankruptcies, gift cards are again experiencing growth. After market stabilization and some needed legislation, retailers are taking advantage of the trend for promotional purposes. Some grocery chains are offering savings on the grocery bill for the purchase of a certain value card. This makes a good tie-in to their loyalty card programs. Others are offering fuel discounts or tying using the cards as an incentive to buy certain items.

There are very few ideas in the business world that are truly win-win. For enhancing the customer experience and proving effective and efficient for retailers, the gift card seems to hit this lofty goal.

ICC/Decision Services Launches Second of its iPhone Applications – ConversionCalc

The latest in iPhone applications shows retailers the dollar value resulting from increasing their conversion rates.

New York, NY — ICC/Decison Services’ latest in iPhone applications shows retailers the dollar value resulting from increasing their conversion rates. ConversionCalc™ is the second of its iPhone applications available for free download on iTunes. ICC’s existing application, the UpSellCall™, was the first of its kind in the industry when it was launched this past summer. ICC/Decison Services is an international customer experience management company based in New York City.

Field management loves our calculators because they are portable and easily show store management the power of associate behavior. “We received great feedback on the UpSell Calc, our first application,” says David Rich, President/CEO of ICC/Decision Services. “Field management loves our calculators because they are portable and easily show store management the power of associate behavior. Corporate loves them because they point to increased revenue. It takes so much to get customers in the door in today’s marketplace,” continues Rich, “but many retailers don’t realize that increasing your conversion rates by only 2% can increase revenue by 10%. The ConversionCalc™ will quantify that lost opportunity for retailers and can produce calculations for a single store, district or the entire retail chain.”

Other features of the ConversionCalc™ include: easy one-screen operation; allows calculations over multiple time periods (days, months, quarters, etc); reveals the true dollar amount for increased associate performance.

Click here for more “ConversionCalc” conversion rates information, iPhone applications and download links.

About ICC/Decision Services
ICC/Decision Services was founded in 1979 to design and execute Customer Experience Management programs. ICC/Decision Services offers a wide range of qualitative and quantitative business tools, including mystery shopping, shopper intercepts, iPhone applications, conversion rates tools, customer satisfaction and employee engagement. Clients include Coach, L.L. Bean, Rite Aid, 7-11, Foot Locker, CVS, Walmart and others. The company is headquartered at 122 West 27th Street, New York, NY 10001, U.S.A. Phone: (800) 444-1717. More information is available at www.iccds.com.

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Black Friday VIPs

The general consensus is that Black Friday resulted in an increase in store traffic, but a decrease in spending per shopper for some overall mild sales gains. But the big question remains, what needs to happen to turn retail browsers into retail buyers? Some brand marketers played the shopper experience card by offering VIP treatment on the busiest shopping day of the year.

A story in the Boston Globe documented some unique approaches. Best Buy offered a limousine ride, special seating outside the store prior to opening, a private shopping tour before opening and a $1,000 gift card. All of this was for winning an essay contest.

The early results of Black Friday show that deep discounting isn’t enough to coax consumers. It also takes an equal amount of clever promotions and some good old-fashioned customer service to close the deal. According to one retail analyst, “The combination of value and service will be the great differentiator,’’ According to the National Retail Federation, sales for November and December are expected to decline 1 percent.

Some other examples of VIP treatment are free cookies, holiday tote bags, gift cards, subscriptions, limousine rides, wardrobe consultations, shopping butlers, gift-wrapping assistants, video cameras and celebrity wake-up calls. Most of these special offers and VIP contest were advertised via social networking outlets like Facebook and Twitter.

Thanksgiving Weekend Shopping as a Social Event

Crowded stores and lines don’t seem to dissuade tens of millions of shoppers from hitting the market over the Thanksgiving Holiday Weekend. Many are looking to cash in on the great deals and others are just taking advantage of some additional time off from work. The National Retail Federation is reporting that 134 million consumers will hit the stores this weekend. That’s a six million person increase over last year. However, there is a developing set of consumers who have a different mindset about Black Friday. They enjoy the event.

In this Retail Customer Experience article, the author discusses how consumers are starting to take power over the event by attacking it like a military exercise. Teams of consumers enjoy plotting a strategy and executing their game plan as not only a bargain hunting trip, but also as a fun social event.

The trend is not going unnoticed by retailers who are ramping up their efforts to cater to this type of social consumer. In many cases they are reshaping the, “Waiting in line experience,” by offering coffee and treats to those in line, making every effort to make the lines faster, and in general just trying to keep the tone friendly. This concierge level of customer care plays in perfectly with the mindset of the “Black Friday as a Social Event” shopper.

On Target for the Holiday Shopping Experience

The news is awash with stories on how the country’s retailers are gearing up for the mad holiday rush that begins with Black Friday. Most of the news has to do with price promotions, store hours and staffing to handle the increase in store traffic. As an example, a story on DSN Retailing Today outlines how mass market giant Target is preparing for the holiday’s with the customer experience in mind.

Not unlike others, Target will expand its store hours and feature price promotions. For example, the stores will open at 5 a.m. and the first 500 guests will receive a gift. Those who spend $100 or more (not hard to do at Target) between 5:00 and Noon will get a $10 gift card.

As far as price, the retailer will offer its Low Price Promise. In other words, if a guest finds a lower price at a competitor, Target will match the price during the competitor’s valid ad date.

Perhaps more eye opening is the improvement being made to the return policy. As a standard, Target has a 90 day policy for returns or exchanges accompanied by a receipt. However, a recent expansion allows you to return or exchange up to $70 in merchandise without a receipt on a rolling 12-month cycle and new and unused items over the $70 can be exchanged for items in the same department.

The on-line function is also getting into the act with free shipping on most items when you spend $50 or more.

Other retailers are also offering similar programs. This is just one example of how a company is using their customer satisfaction data to directly enhance the customer experience for the holidays and beyond.