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Fred Clements: The future of retail? It’s the people!

Published October 18, 2013
A blog by NBDA executive director Fred Clements

Editor's note: This blog post was written by Fred Clements, executive director of the National Bicycle Dealers Association. Clements' previous blogs can be read on bikedealerblog.wordpress.com.

A British market study shows that retail staff members are the key to making customers feel comfortable while shopping, and also cause them to buy and spend more.

Service Management Group collected opinions, views, and purchasing behavior from 359,000 consumers in the UK. The findings provide broad insight into consumer priorities and expectations, and seem to mirror the many trends being reported by bicycle retailers in the U.S. market.

Some highlights:

  • Customers who receive assistance in a store, on average, spend up to 40 per cent more than those who are not helped by staff.
  • For highly-satisfied consumers, assistance (43%) and friendliness (32%) were cited as the most important factors in their satisfaction, followed by item availability (14%) and speed of service (13%).
  • For dissatisfied consumers, the biggest turn-offs wereassistance (27%), speed of service (22%) and item availability (20%). The report notes, "This report reveals staff assistance has the biggest impact on the customer experience of SMG's clients, highlighting the possibilities and challenges facing the retail sector to improve customer service and staff motivation."
  • Diving a little deeper into the numbers, good staff is a plus even when a customer doesn't want assistance. If they don't want help but receive it anyway, they spend on average 11 percent more. For those who actually want help and receive it, they spend on average 22 percent more.

The researchers also offer advice to help retailers combat the growth of e-commerce. Staff is again a difference-maker.

They write, "E-commerce means that the in-store experience needs to offer something different than the online experience. To ensure staff deliver high levels of customer service, they require appropriate training so they have correct product knowledge and understand what is expected of them when delivering service to customers."

Well-trained staff members also have a direct impact on revenue. Customers who receive product recommendations increase their purchase size by 15 pe cent. This is also an opportunity to build long-term loyalty as customers learn to rely on staff for recommendations.

With the use of mobile devices increasing, SMG also recommends that "online shopping be seen by retailers as complementary rather than competitive."

Almost half of consumers under age 18 pre-shop online before visiting a store, with the percentage declining with age. Fewer than 20 percent of those over age 55 pre-shop online.

Those who pre-shop online spend 15 percent more when they visit a store.

"While the rise in online shopping can be seen as disrupting the status quo, it cannot be seen as destructive. The benefits of an omnichannel strategy is also being realised by pure e-tailers, demonstrated by Amazon and eBay launching pop-up stores to capitalise on the benefits of the in-store experience. Retailers can no longer separate their online presence from their brick and mortar status, as they need to be unified to represent the brand values."

Quality shopping experiences also appear to be time-dependent. Before 11 a.m. seems to be when store employees are at their best. As the day progresses, the quality of the experience declines and it is even worse on weekends, especially Sundays.

"Customers are experiencing a severely reduced shopping or dining experience on Sundays. However, the weekend is a period when the majority of customers will be out and about and likely to spend money. This is creating more problems for retailers, as without staff being trained correctly, they are risking increased complaints, damaged brand loyalty, and reduced average spend for each customer."

A final point is related to problem resolution. Staff that can add value and provide a resolution to a problem can create loyal customers who recommend the business to friends.

"With the proliferation of social media, many customers will take to social networking sites to discuss their experiences, both positive and negative, with friends, family, and the wider world. Forward-thinking brands aim to establish a strong staff training programme to best equip staff to handle problems and establish a strong customer feedback channel so they can improve service in real-time."

Specific recommendations for retailers based on the research:

  • Consistent brand experience across all channels is important to improve customer satisfaction.
  • In-store staff behavior is directly related to customer satisfaction. Staff need to have training so that they can handle customer queries or complaints effectively.
  • The store manager is fundamental to in-store employee behavior. Through staff incentives and motivation, businesses can achieve a high level of employee satisfaction, better customer service, and improved customer loyalty.
  • Staff should be encouraged to use open questions and statements to prompt requests for assistance.

 

 

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