How can pandemic-crushed specialty retailers that were too slow or ineffective ramping up their e-commerce capabilities come back from the brink? Don’t look to Amazon, the big-boxes or category killers for inspiration, advises Wharton Professor Thomas Robertson and director of its Jay H. Baker Retailing Center. Instead, set your sights on Ritz Carlton, Disney Parks and British Airways.
[callout]In-store shopping is going to absolutely explode. People want to get back into the store. They want to interact with humans. We’ve been hiding behind our computer screens too long.[/callout]
“These are all people intensive businesses, and they manage to deliver excellent customer experiences consistently,” he says, referring to British Airways. The airline company studied the key moments/customer touchpoints to identify where it was essential to get the customer experience right. By identifying the most customer-impactful moments — waiting in line at the check-in, boarding and during drink and food service, British Airways has been able to use the research to execute excellent customer service each and every time.
Now that stores are finally starting to reopen, this is the time for retailers to make every moment and every touchpoint special. To guide retailers on this next phase of their customer experience journey, the Baker Retailing Center teamed with the global customer experience consultancy, The Verde Group, to study the impact of customer experience on customer loyalty.
They fielded a study with 9,400 U.S. consumers about what makes for an excellent customer experience – called a WOW! shopping experience – and found it doesn’t require employees to go above-and-beyond, just to deliver the expected customer experience flawlessly, consistently and without friction. And if those promised customer experiences are delivered, it goes right to the retailers’ bottom line, by significantly increasing consumers’ purchase intent and ongoing loyalty.
Promises Made, Promises Kept
The keyword is promise, because customers have different expectations of WOW! customer experiences depending upon the type of retailer.
- For mass merchants, it’s having well-stocked shelves and in-stock inventory, which can lift purchase intent by 42 percent.
- For department stores, it’s having an easy shopping experience with no problems start to finish (41 percent lift).
- For category killers, it\’s having a clean, organized and welcoming store environment (47 percent lift).
- The category where the greatest opportunity lies and where the greatest gain can be achieved by delivering WOW! customer experiences consistently and flawlessly is specialty retail (40 to 58 percent lift).
Specialty Store WOW!
“Specialty retailers must be enjoyable, wonderful places to go,” says Paula Courtney, president and CEO of The Verde Group. In other words, specialty retailers must attend to every detail, make shopping easy, have stores well organized and have employees go the extra mile to delight customers. Flawlessly and consistently delivering on each of these promises matters to the bottom line. “By creating those WOW! experiences, customers will want to come back more often, will recommend you to their friends and will increase their average basket size,” Courtney says.
Reach Beyond the Computer Screen
When it comes to the online experience (and why Ritz Carlton, Disney Parks and British Airways need to be specialty retailers’ benchmark not Amazon), specialty retailers’ mobile apps and websites need to draw customers into the physical store, rather than just take and fulfill orders.
“Specialty retailers need to crack the code on how to engage customers digitally to bring them back into the store,” Courtney says. “There’s a rosy future for those that do. But the retailers that will have a tough time are those that cannot coexist in the digital and brick-and-mortar world.”
In the survey, improving online ecommerce experiences didn’t move the needle at all for specialty retailers, but using digital engagement to improve the in-store experience did, by 47 percent.
Courtney references a study her company conducted with Google that found 70 percent of customers on their path to purchase in brick-and-mortar stores first do online research. ”There is a massive online experience that occurs before transactions are actually made in a store,” she explains.
Specialty retailers must recognize the power of a strong digital presence, not necessarily to conduct transactions, but to entice people into the store. “Specialty retailers’ ecommerce is often is a very small percentage of sales. The value of a strong online experience is about merchandising your products and communicating your service promise, even if it might not represent the majority of your revenue,” Courtney continues.
Make the Magic Happen
Opportunities will be huge for specialty retailers that prepare for their grand in-store reopenings by placing the emphasis on the personal side of the customer’s shopping experience at each touchpoint on their journey. That’s where the magic can happen for both the customers and ultimately the retail business.
“There is incredible pent-up demand for social interaction,” Courtney says, and Wharton’s Robertson concurs. “In-store shopping is going to absolutely explode. People want to get back into the store. They want to interact with humans. We’ve been hiding behind our computer screens too long.”
Robertson doesn’t foresee retail ever going back to the way it was before; too much has changed and the discontinuity from the pandemic too great. Retail has been permanently reset. But rather than lament that fact, retailers need to grab the new opportunities as they present themselves.
“Maybe 60 or 70 percent of retailers won’t make it long term. But live commerce is never going away,” Robertson says. “It’s not so much that we have to reinvent retail, but we must refresh the experience.” Courtney adds, “Retailers need to use every touchpoint on the customer journey to stage that WOW! experience.”
Touchpoints as the Roadmap
Creating that ultimate WOW! customer experience in store Is not as hard as it may sound. It’s going back to basics, rather than setting some unattainable goal. Giving hassle-free support is not hard, but it requires retailers grant in-store staff the autonomy to make on-the-spot decisions, not follow rigid guidelines.
- Having a clean, well-organized store environment requires staff devote little time every day to straighten the shelves.
- Enabling e-commerce capability and fulfilling those orders rapidly is less important than making sure the website and mobile app make the best first impression and draw people to the store.
- And welcoming customers with a personal greeting, rather than the conversation-killing “May I help you?” takes hiring friendly, emotionally intelligent people who know how to use small talk to lead to personal interaction.
Specialty retailers need to follow British Airways example and research those specific touchpoints in the customer journey that most impact their feelings about the store – not just whether you’ve got the merchandise they are looking for that is priced right. Retailers must manage every critical touchpoint to make customers feel they want to do business with the store, again and again.
“Retailers need to precisely define the customer experience when they walk into the store and when they do business with you, rather than develop lofty, esoteric goals and customer service policies nobody really understands,” Courtney concludes. “Make it easy to execute and train the entire workforce toward observable and measurable actions. Your brand is what you want your customers to experience. It’s not what you say your brand is that is important, but how your customers experience your brand that counts.