Customer survey results can be misleading

 

 

Many retailers ask customers for ratings on the service they received during a shopping trip.

Often, these requests to complete a survey are made from the associates themselves, and reinforced through a reminder on the receipt.

But exactly how valid are the results from these surveys?

At least one team of researchers say the answers aren't as truthful as retailers might hope.

 

Customers are biased in favor of employee security

This week, NPR's social science correspondent Shankar Vedantam talked on-air about a conversation he had with John Horton, a business school professor at New York University.

Horton and his colleagues had studied what the consequences were when people were asked to rate their service.

It turns out, there is bias inherent in such survey questions, because people are reluctant to give others a harsh rating: Fearing their answers may jeopardize employee jobs, respondents tend to rate service higher than it deserves.

So, even if a customer feels that an associate could have been friendlier, or more knowledgeable, he or she will give a three or four-star rating, rather than a more objective one or two-star rating.

Customers know that there are companies that will fire employees that have low ratings, and many don't want to be responsible for someone becoming unemployed simply if he or she was having "a bad day."

 

Use feedback for training

That does not mean, however, that customer feedback can never be trusted.

To obtain meaningful results, the survey must itself be constructed without bias.

Horton and his colleagues analyzed data from a large online platform with over a billion dollars in transactions.

They learned that when a rating platform informs users that the feedback is going to be private and that it won't be used to punish providers, users will provide more critical feedback.

The lesson is that even simple, one-question surveys can provide valuable feedback, as long as they don't appear to threaten the livelihood of individual who is being evaluated.

 Read blog: 3 CX improvements that drive revenue growth

If the survey makes it clear that the feedback is used for training purposes, participants will be honest.

And then future experiences might truly be worthy of a five-star rating.

 

 

3 realities about your Baby Boomer shoppers that will help you win them over

 

 

Baby boomers — those customers between the ages of 54 and 72 — are predicted to increase their spending by 58% to $4.74 trillion over the next 20 years.

That's far more sales growth than millennials, whose spending will grow by only 24%.

With an estimated 75.4 million baby boomers in the United States, retailers can't afford to ignore this segment of the population.

Here are 3 realities retailers often fail to recognize about their baby boomer customers.

 

1: Boomers see technology as a tool.

Technology is a clear winner when used as the means to an end: Tablets for line-busting or to check inventory are welcome.

Technology that is seen as distracting or as taking away from the customer experience is a no-no. The demographic is not digital-native, so the sales experience should be personal, with eye contact, helpful associates and relationship building, i.e., conversation.

Only 12 percent of boomers said in a Colloquy survey that they rely on family and friends to help them decide on a purchase, so social sharing before buying is fairly uncommon.

 

2: Boomers enjoy shopping in-store.

The Colloquy report found that a whopping 84% of respondents said they preferred to shop in-store.

That figure is likely tied to Boomers high expectations of personal service.

There's a tremendous opportunity for retailers that choose to invest in understanding this demographic's characteristics.

 

3: Boomers do shop online.

And in significant numbers: 66% of the segment reportedly make regular purchases using web devices, according to Immersion Active.

In the United States, 70% of disposable income is attributed to Baby Boomers.

As Boomers become more comfortable with ecommerce as well as social media-savvy, it's likely they'll be discovering and purchasing trending products online.

As they become more "omnishoppers," they may become the key to the success for many brands.

 

Retailers need to realize the importance of differentiating their demographics when implementing a sales strategy.

Groups such as millennials, Gen X and baby boomers respond to sales techniques differently.

And, while millennials might be grabbing attention with their brand awareness and focus on social media, retailers need to be aware of and cater to baby boomers‘ particular traits.

 

3 CX improvements that drive revenue growth

 

 

For retailers looking to compete with the fast pace and convenience of online businesses, the in-store experience is an increasingly important battleground.

While historically success for retailers may have been measured by metrics such as comparable growth by store, sales per square foot, and gross margin return on investment, these no longer tell the full story.

Modern retailers need to know more than just what your customers are buying.

To succeed today, you need to understand how each of your touch points impacts the totality of your customer experience.

And the trend is one that’s catching – a recent study by the Forrester Group reports, “72% businesses now say improving the customer experience is their No.1 priority.”

 

CX improvements drive increased loyalty & revenue

For today’s retailers, the availability of point-of-sale data provides a huge range of options when it comes to building true and lasting engagement.

Creating customer experiences that are truly memorable can help drive loyalty and advocacy for your business, so it’s important to make every single moment count.

Here are 3 quick examples of how to deliver a ‘customer-centric’ approach that will spur revenue growth.

 

1: Make each experience count

In an increasingly competitive landscape, you need to focus on creating memorable experiences.

This doesn’t need to involve a radical overhaul of everything you do. As we found with one of our retail partners, the little things can add up.

The Retail Prodigy Group (master franchisee holders for Nike) is committed to providing the ‘ultimate customer experience’ with every visit.

In practice, this manifests itself in a series of relatively cost efficient, but rigorously maintained, service measures, especially at the point of sale.

Staff at RPG are trained to ask for each customer’s name and always offer multiple product selections at the checkout.

Customers are made to feel welcome with small personal touches, creating an authentic and warm experience.

This not only creates happy customers but can lead to financial gain too – we measured a 30% increase in average transaction as a result of these measures and a 5% increase in total revenue

 

 

2: Taking a ‘benefits-led’ approach to the sales process

Today’s customers expect high service standards as the norm: in order to drive return visits, you need to be able to certainly meet and ideally exceed these expectations regularly.

While many sales associates are trained to ensure that they know the features of each of their products, it can be even more powerful if your staff is able to speak to the benefits that a product will offer to each of your customers.

A benefits-led sales approach not only demonstrates expertise but also the capacity to listen well.

One retailer found that a sales associate’s ability to convey three or more product benefits led to a 20% increase in average transaction value. 

Treat your customers well, and they’ll reward you in return.

 

 

3: Make sure that you are staffed appropriately

From an operational perspective, it can be a challenge to monitor for consistency of staffing distribution and the timing of staff breaks across a day so that each customer gets what they need every time.

While breakdowns in your scheduling patterns are not always easy to spot, the negative impacts are.

If your customers aren’t getting the help they need, they’ll quickly take their business elsewhere.

By utilizing technology that enables you to track performance standards across the day, you can reduce mangers’ need to be on the floor at all times.

One specialty foods retailer using the TruRating customer feedback solution noticed their product and service scores were dipping in the evenings.

After an inspection of the floor, it became clear that there were issues in stock and staffing.

Through a scheduling reshuffle and an increased focus on product availability in the evening, the store was able to drive a 22% increase in customer satisfaction and a 12% associated increase in spend.

A low-cost fix was suddenly transformed into a revenue opportunity.

 

Point-of-Sale Insights from TruRating and Retail Pro

With simple changes like these, you can optimize toward a more ‘customer-centric’ approach in your business – and tools like Retail Pro POS and customer insights specialist TruRating can help.

Through a simple integration with Retail Pro POS, TruRating enables you to ask customer feedback questions via your payment devices, gathering insights from up to 88% of customers daily, neatly packaged in an intuitive and easy-to-read dashboard.

To learn more or to find out how you can set up your account today, reach out to your Retail Pro Business Partner or contact TruRating directly at 1(855) 285-1685 or Hello@trurating.com.

 

 

Guest post from our friends at:

 

The Personal Data Paradox [eBook]

 

 

Today’s headlines are ablaze with privacy scandals and consumer demand for transparency in data collection.

From Facebook to Amazon, we aim to bring down giants for perceived intrusions on our autonomy.

These are powerful political concepts that dominate the conversation around today’s technological advancements and our desire to apply morality to the digital world.

Equally as powerful as these headlines are the paradoxical returns and conversion rates that retailers are experiencing from data driven personalized marketing content: content that is derived from data collection unique to individual shoppers, i.e. personal preferences and tastes.

Public opinion seems to contradict consumer expectation.

Get this eBook to see consumers' perception of privacy, their expectation of personalization, and the middle ground we are all looking for.

 

 

 

 

 

 

 

Get the eBook

 

 

 

Want loyal customers? Gartner says: Improve their experience.

 

A recent report from Gartner found that a large majority — 81% — of customer experience (CX) leaders predict they will compete mostly or entirely on CX.

However, less than half of those responding have established the rationale for why CX drives business outcomes.

In addition, although companies believe they are improving CX, it's unclear whether they are actually doing so.

By their own metrics, 48% of respondents said their CX efforts exceed management’s expectations, but only just 22% reported those efforts exceeded customers’ expectations, according to the Gartner report.

Retailers' CX strategies are clearly falling short, but improvements can be made. Here are some suggestions from the Gartner study.

 

1: Assess capabilities

Retailers should take a deep dive and determine whether the data they capture provides a clear picture of customer wants, needs and expectations, rather than their perceptions of existing initiatives.

Once the customer data is gathered, touch points identified, and measurement systems implemented, consider demographics.

Millennial customers, for example, enjoy complicating CX matters.

Research shows that millennials don't take loyalty programs as seriously as older customers, because they bristle at the idea that a brand would take their business for granted.

While they may be regular customers at a particular retailer for a while, millennials need fresh, compelling reasons to be loyal.

 

2: Tailor customer journey maps

Provide relevant experiences at key touch points to drive customers deeper into the buy, own and advocate journey.

Brands hoping to secure loyalty need to start by putting themselves in their customers' shoes: How can a brand show loyalty to its best customers?

Understanding guests and customers across all channels and touch points is critical, no matter where they are on the customer journey.

 

3: Measure more innovative CX efforts differently

CX leaders must make sure to measure their more innovative customer experiences against adoption, perception and financial objectives.

Customer experience must evolve, but it must do so bearing in mind the successes of the past.

Understanding the differences between customer segments is critical.
If customers are primarily millennials, engage in a way that aims to satisfy their desire for recognition and status.

Provide them with a platform for standing out as trendsetters.

But if baby boomers are a majority of clientele, understand they prefer high touch over high tech: Service with a smile is paramount for those customers.

Gartner boils it down to this: understanding customer experience is paramount to success, one size does not fit all, and it's the customer's perception that matters most.

No matter how successful a retailer thinks it is in providing top notch service, the customer's opinion is still always right.

3 qualities of authentic retail shoppers value most

 

 

Authentic.

It's a term that retailers are using increasingly to describe how they aim to be and communicate with customers.

It's also a word that customers use to describe their ideal retailer.

Shoppers' expectations have changed. It's no longer enough to just sell quality products to your core customers; the retail personality is important and extends to how shoppers relate to and interact with brands.

But what makes a brand authentic in shoppers’ minds?

 

1: Honest communication

An "authentic brand" refers to one using less marketing-speak and more honesty.

Today's customers are less impressed with fancy slogans than with accurate, interesting, and socially aware mission statements.

They want product features detailed in plain English with no "fluff." They view traditional advertising with skepticism and, often, disdain.

Millennials in particular don't want to be "sold to." Authentic retailers have integrity and demonstrate honesty as well as a certain level of transparency.

Customers are interested in learning what a brand stands for, what causes it supports and how its offerings help achieve its stated goals.

 

2: Quality & fairness

"Brandless" is a retailer that believes in "Life, liberty and the pursuit of fairly priced everything."

It appeals to customers who are price conscious but who are also interested in value.

Products are high quality, featuring low prices and no brand names.

Brandless is targeted to the savvy, budget minded shopper who wants quality but not necessarily a brand.

Brandless does not have to contend with adding markups for distribution, in-store advertising and shelf stocking.

It also provides organic, non-toxic, hypoallergenic products that aren't tested on animals. Those globe-conscious characteristics resonate with their customers.

 

3: Standing for more than just the bottom line

Now more than ever people want to know the history of retailers, what their mission is and how they conduct business.

To a degree, customers view retailers and brands as an extension of their own beliefs. Retailers are expected to have values that reflect their customers'.

For example, family-oriented shoppers may not shop on Thanksgiving, because they believe sales associates should be able to spend the day with their families. They might then shop on Black Friday at retailers who were closed the day before, thereby rewarding the stores that align with their value systems.

They want to do business with an "authentic" brand, one which has a core business strategy that evokes the virtues they themselves consider important.

A retailer must walk the walk as well as talk the talk, or customers will find one who does.

Is it really discovery shopping if Amazon found it for you?

Effects of data-driven curation on discovery experiences

 

 

Remember when a trip to the store could yield a new discovery -- an unplanned purchase but one that delighted the customer?

Ecommerce handles specific shopping needs seamlessly and efficiently: Search for “motorized pedal exerciser” and buy it in less than three minutes.

But so-called "discovery" shopping — such as figuring out what to get your hard-to-shop-for great aunt for her 90th birthday — is much easier to do through brick and mortar browsing.

 

Selling discovery experiences

The world of in-store commerce offers shoppers an experience, an interaction with others that can't be replicated online.

In the best-case scenario, the experience is enjoyable and memorable, one that a shopper wants to repeat with that retailer and emulate at others.

No matter how good a recommendation engine or a chatbot is, the feeling a shopper gets from finding a perfect product can only come from shopping in a physical store.

That is, until an online retailer aggregates its collected data and presents it in a physical store as a curated collection to reach a specific audience.

If an online behemoth parlayed all the knowledge it has gleaned from the data it has gathered about its ecommerce shoppers, that retailer could be very well positioned against its competitors, online as well as brick and mortar.

 

Peer-based discoveries

Amazon has recently opened a handful of Amazon 4-Star physical locations, which are designed with discovery in mind. All the items are top-rated, and the selection will change frequently, depending on their customers' ratings.

The first, in the SoHo section of New York City, offers at-a-glance products that are "popular in SoHo," "frequently bought together" and "most wished for," among other categories.

Amazon can easily put these displays together due to the data it collects on its online shoppers. And that data collection continues to grow offline.

Amazon-exclusive products are also available, and Prime members get the Amazon price, while non-members pay MSRP. Signing up for Prime in the store not only provides customers lower pricing, but also adds to Amazon's information database.

Shoppers can see how many ratings a product has received and what the average rating is. Others have reviews displayed nearby.

The combination of a physical location and all that aggregated data is a fierce combination.

 

Personal discoveries

However, "discovery shopping" is more than simply sorting through trends and selecting from the most popular items.

If that were the case, small, specialized shops and boutiques would not be frequented, shunned for larger, on-trend department stores.

But the opposite is largely the case.

Discoverers aim to find the one-of-a-kind for a more personal gift or to satisfy their own personal taste. That's more likely to be found in a shop on Main Street than online, because it is not mass produced, so it therefore can't have hundreds of reviews.

 

In the end, Amazon's strategy for its physical stores, and any others like it, will mirror that of large department stores that have built a decent ecommerce channel.

Those stores, such as Macy's, Target and Kohl's, can also look at their data, slice it up regionally and offer only those products based on that data.

While not quite as personal as the local shop on the corner, there's a huge opportunity for larger companies to meet their customer needs more precisely.

 

How retailers are actually spending their customer service dollars

 

 

When companies describe themselves as having "excellent" customer service, the claim sounds user-centered but too often it's actually just a company-centered focus trying to position themselves as user-centered.

Those companies are generally concerned with efficiency and reducing costs first and foremost, and are just hoping to improve customer relations by osmosis, without actually doing the work to get there.

 

Questioning ROI on CX investments

Some retailers resist customer experience investments, believing they do not provide a significant return on investment.

However, Gartner reports that when it comes to making a purchase, 64% of people find customer experience more important than price.

Constantly trying to be the lowest-price provider of goods is futile: Competition is steep and low price is not an effective means of cultivating loyal customers, who are the foundation of success.

According to a Walker study, by 2020, customer experience will overtake price and product as the key brand differentiator.

Customers are loyal to a retailer because they believe they are getting a better experience, higher value and benefits than they would get from other brands.

In addition, a recent study from RetailNext found 57% of respondents said customer service is the only reason they go to a retail store.

Not selection, not price, but service.

Here are 4 pairs of categories in which retailers invest their customer service dollars. You decide which ones will actually create better customer experiences.

 

1: Self-service tools vs well-trained sales associates

Shoppers like that expect to find associates equipped with the information and training necessary to assist shoppers and close sales.

Too many retailers do not have that staff, so customers are frustrated and disappointed.

Today's shoppers want knowledgeable associates in the stores they frequent, as well as convenience. They also want to build a relationship with the retailer.

Retail management misreads customers’ disdain for associates as a desire for self-service.

But customers are happy to be served by well-trained, engaged salespeople. The frustration comes when the associate knows little about the product or has no enthusiasm.

Training goes a long way to fix that problem and helps build a sales team that is a contributing factor to customer loyalty.

 

2: Market saturation with new locations vs pop-up stores

While some brands focus investment toward market saturation via geographical expansion, others use pop-ups to build excitement about their brand.

Event-and experience-driven retail is becoming more popular, as department stores create pop-up locations or marketplaces in their stores and in hip shopping meccas.

Such temporary installations are smaller and more focused with their offerings and are replenished much more frequently, creating the impression of a “fresh” experience at every visit.

 

3: Promos to attract new shoppers vs rewarding repeat customers

Newvoicemedia.com reports that the top reason customers switch away from products and services is that they feel unappreciated.

Once customers have demonstrated their loyalty, it's important to reward them.

Too many retailers use incentives only to attract new customers. That, in effect, "ignores" loyal customers, leaving them frustrated and unappreciated.

 

4: Advertising costs vs experiences that drive WOM marketing

Nurturing existing customers and improving customer service can cost considerably less than launching advertising and marketing campaigns, but can have just as powerful an impact.

As Tony Hsieh, Founder and CEO of Zappos has said, “We take most of the money that we could have spent on paid advertising and instead put it back into the customer experience. Then we let the customers be our marketing.”

75% of Zappos' sales come from returning customers, and the company earns more than $2 billion in sales annually.

The Zappos's commitment to having happy customers and employees ends up being good for business.

 

Walking the customer service walk means more than just talking the talk.

Strong training, with an emphasis on earning customer loyalty, will result in a truly user-oriented business.

 

Attracting and retaining the elusive Millennial shopper

 

 

Loyal customers — the Holy Grail for retailers.

Repeat shoppers are a source of recurring revenue. Smart businesspeople know that success lies in cultivating loyalty, and that means more than creating programs that simply collect customer information.

Today's educated customers understand loyalty programs are often of more value to retailers than to customers.

Millennials in particular are sensitive to that value proposition, and retailers are starting to serve up programs targeted toward the specific desires of this demographic.

A quarter of millennials and 19% of Gen Xers like to shop with family and friends. It's a social activity that's enjoyed at a brick-and-mortar storefront.

But, while Gen Xers value the relationship with a store, Millennials value experience and don't have the same brand loyalty as the older generation.

It's easier to get a millennial to try a competing brand, so it's more difficult to retain millennials as customers.

Retailers have to work at providing customers perceived value consistently to earn their loyalty.

3 things Millennials look for:

 

1. Technological "wins"

 
How does a retailer make it easy for customers?

Millennials are dependent on their phones; 84% of them in a recent study said their mobile devices were the most important thing in their lives.

Retailers can use that knowledge to their benefit by, for example, offering mobile apps that are easy-to-use and relevant.

Many say that shopping is easier through an app than through a web site; by offering a digital experience that reduces purchasing friction and makes shopping easier, a brand can improve its relationship with millennials.

 

2. Shared value system

 

What matters to a brand, matters to Millennials.

For example, Patagonia has supported grassroots activists working to find solutions to the environmental crisis.

Shake Shack's ethos is "We stand for something good," which is reflected in its carefully sourced premium ingredients from like-minded purveyors as well as in its community support.

Customers feel good purchasing from companies that align with their world views.

 

3. Personalization

 
Yes, for customers, it's all about "me."

That doesn't mean obsequious associates greeting customers they don't personally know by their first name or creepily sending birthday cards to clients they've barely served.

Rather, it means positioning the company in a way that feels customized.

That includes having Instagram-worthy products, immediate customer service response and marketing that focuses on word-of-mouth.

Influencers — high-profile customers whose style is "gospel" — can be more powerful brand advocates than any type of advertising.

But it's not all about celebrity: For example, Carter's apparel encourages Millennial parents who want to share photos of their Carter's-clad babies to use its hashtag #lovecarters.

Retailers can have paying customers, or they can have loyal customers.

High quality products and experiences encourage loyalty in Millennials, who tend to be more easily swayed by special promotions and lower cost than previous generations.

However, loyalty can be earned: Retailers with compelling brand stories and experiences that regularly exceed expectations are positioning themselves to welcome the elusive repeat millennial customer.

Gesture recognition helps retailers gauge shoppers’ real interest

 

 

Artificial intelligence can help even the fussiest customer find just the right product, in a fraction of the time it would take without any technological assistance.

While AI has been used in various businesses, including retail, to improve efficiencies, the technology has also been employed to help stores improve the customer experience by providing more personalized service.

Through advanced gesture recognition, retailers can determine the popularity of an item by analyzing shoppers' facial and hand gestures.

Software analyzes the way shoppers react to a certain item and determines whether the item is a potential sales buster — or a dud.

Just as an online recommendation engine analyzes a shopper’s movement within a site, gesture recognition software "learns" how an item affects a shopper, and can assist the retailer in finding an item that is perfect for a particular user.

 

Understanding shopping patterns

 
The ability to know what merchandise has been viewed and ultimately rejected is crucial if traditional retailers want to compete against the likes of Amazon.

Digitally native retailers understand customers’ purchase and shopping habits, because their machine learning models see all the data.

Brick and mortar retailers are far behind in understanding customers' shopping patterns.

Gesture recognition can arm retailers with predictive power.

By analyzing customer data created by interpreting human gestures using mathematical algorithms, retailers can discover which customers are most likely to buy certain products.

 

Prescriptive intelligence

 
As AI advances, businesses will shift from gathering predictive data to prescriptive intelligence.

Once retailers understand why customers buy a product — or why they do not — the next step is to gather intelligence so marketers can illustrate the reasons why shoppers should buy a product.

 

Sales help

 
AI has the potential to amplify and augment retailers' creativity, by providing not only necessary data, but also freedom from time-consuming, mundane tasks.

The key for brick and mortars is to employ AI in ways that provide in-store assistance to human retail associates.

For example, AI that is integrated into inventory systems can quickly and accurately answer repetitive questions such as stock requests, store hours and directions.

Sales associates can then focus on helping and closing deals with customers.

Such tasks can accumulate and chip away at salespeople's time, leaving them little time to create customer relationships.

Gesture recognition is no different in terms of its potential to enhance customer service.

Salespeople receive accurate insights quickly, providing them with the opportunity to react appropriately.

"AI assistants" can help provide associates freedom from mundane, routine tasks so associates can work on improving personalized customer experiences.

By making appointments, sifting through and prioritizing email and scheduling various tasks, an AI assistant allows the retail associate to shine in pursuit of customer satisfaction.