How Educated Customers Raise the Bar on Retail Experience

Customer Dissatisfaction - how educated customers are raising the bar on retail experience The Verde Group

Customers love the ability to shop anywhere — online, in the store, or over the phone. What they hate is the fact that often they feel they don’t have all the information they need to make an informed decision. Or worse, they feel they’ve been misled.

Retailers should consider that their customers usually aren’t wrong. Instead, they may have made a wrong choice because they’re unclear, and it’s often because the retailer didn’t give them all the information they needed.

Educating customers has never been easy, and it’s getting more difficult. The multi-channel shopping experience means customers may get a different experience depending on how they interact with a retailer.

Customer dissatisfaction – broken communication
For example, if the customer bought something online and decides to return it, can it be returned to a brick and mortar store? Is there a cost to return it via courier versus in-store? If the customer phones the store, will the person who answers be able to accurately describe their options and the implications of each?

To make matters more complex for retailers, customers are relying on a number of methods — both online and in-store — to educate themselves prior to purchasing.

A 2017 Canadian Consumer Retail Research Study conducted by WisePlum, Microsoft and the Retail Council of Canada determined that 68% of department store shoppers found that ‘comparing product details or specifications in-store’ was very useful. At the same time, 61% said that ‘comparing product details or specifications online’ was very useful, and 60% said the same about ‘browsing for information on their smartphone’.

Even as retailers struggle to provide complete and consistent information to customers across all channels as part of a true omnichannel experience, customers’ expectations continue to rise. They’re not just comparing retailers with their direct competition, but with every other recent customer interaction they’ve had.

So if they recently had a flawless return experience with Amazon, then a poor experience with another retailer, the former is the new benchmark, and the latter is viewed as a failure.

Customer dissatisfaction – problems pre-purchase
And, according to the 2017 WisePlum research, that shopping experience is often anything but flawless. For example, 39% of department store shoppers said they had at least one problem before purchasing, with the number rising to 47% for Gen Y and Gen X shoppers.

Shoppers encountered many of these problems while they attempted to educate themselves pre-purchase — determining online availability, slow and challenging website navigation, discrepancies between online and in-store pricing, and even a lack of information about delivery charges.

While it’s true that many retailers are making heroic efforts to proactively educate their customers and provide them with complete information, customers could be forgiven for thinking that things are getting worse, not better. Especially if they’re using a credit card or renewing their cable service.

Credit card companies don’t make it easy for consumers to understand their statements. From hidden fees to service charges to how interest is calculated, many customers are unable to untangle the information and make poor choices as a result.

The rules often change with credit card companies as well. Look no further than ever-shrinking payment grace periods. According to consumer advocacy site WiseBread, “Grace periods are getting shorter or being eliminated”.

While cable companies are also known for indecipherable statements, it’s their ‘secret negotiation’ tactics that make many customers’ blood boil. Come renewal time customers know there’s a good deal to be had, but they’re not given the basic information they need in order to make a decision. Instead, they’re forced to speak to a line-up of customer service reps and loyalty managers, repeating their story over and over and watching the clock until a deal is finally reached.

Bad actors aside, there is a lot that retailers can do to reverse customer perceptions and make sure their customers are well-informed. Here are three points to consider:

  1. Look outside your industry for best practices
    Savvy retailers know that they share their customer’s wallet with a wide range of suppliers, not just those in their own segment. Many companies are both creative and effective in how they educate and inform customers.  There is much retailers can learn from them.
  2. Understand how customers buy, and not just from you
    Retailers should use customer feedback and detailed interviews to learn how customers buy and consume from everywhere, and what they view as their most positive experiences. Once it’s understood how they buy and what they’re most receptive to, education efforts are much more likely to hit the mark.
  3. Fix the customer’s problem first, then fix your system
    When a customer has a problem, fix it. They don’t need (or want) to know why your back-end process won’t let them do something or the 12-step escalation chain of command they need to follow. Retailers need to create a culture that says, “Send the customer home happy, then work things out”.

As customers embrace the omnichannel shopping experience, keeping them informed and educated is more important than ever. And if they do have a problem, companies can’t let the customer’s lack of information or understanding get in the way — they need to just fix the problem.

Think of the Ritz-Carlton hotel chain, who authorizes employees to spend up to $2,000 per day to improve the guest experience. Who will be raising the customer experience bar even higher tomorrow?

Paula Courtney is Chief Executive Officer of The Verde Group and Product Founder at WisePlum.

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