1 Huge Mistake Retailers Make, and 4 Ways They Make It.

By Tom Demerly.

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Amazon.com has lead the online customer service race with their patented “One Click” buying system for web purchases. It is fast, convenient and respectful.

The single largest retail mistake is failing to make the customer experience the top priority. Every operational decision should emanate from customer service and convenience.

Modern retailers have fallen into four traps of subordinating customer service:

  1. The sales staff is very poor.
  2. The checkout process is too long.
  3. They offer repeated, hollow apologies.
  4. They try to collect too much information without a reward.

First: Retail is at the bottom of the job ladder in all but a handful of niche markets. The pay is bad, the hours are long and the work is not inspiring.  If retailers spent more time training staff personally, not through an automated curriculum, staff quality would improve and a basic human need for the employee would be fulfilled; the need for interaction as a valued person. The most demoralizing part of being an employee is feeling like a poorly maintained cog in a machine. Everything from automated job applications to slide show training sends a clear message to employees; they’re a commodity. Personal and recurrent customer service training communicates and maintains not only the standards of customer service but also the nuances like tone, posture and other forms of subtle conduct. Retailers need to invest time in personally mentoring their sales staff. Then sales staff will mentor customers into being loyal.

Second: In a race to collect data and maintain inventory retailers have adopted checkout systems that take too long. I wrote about this here. The checkout experience has become painful. It should be quick and respectful. Two key mistakes are poorly handled defects in the transaction and making the customer wait. Customers: It’s not your fault if a bar code scans incorrectly. If even five percent of customers walked out when a bar code or checkout error occurred the retail industry would change. Vote with your dollars. If checkout is cumbersome or protracted, don’t reward that with the sale. Shop elsewhere.

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The basics of retail excellence haven’t changed in a century: Courtesy, quick check-out, owning mistakes and compensating the customer for them and respecting the customer’s privacy and time.

Third: Sincerely apologizing for a customer service error is step one, but the pay-off is fixing it. Repeatedly apologizing makes the retailer look less competent. The best way for a retailer to say, “I’m sorry” is to quickly solve the problem. If an item is incorrectly priced the retailer should deeply discount the item on the spot to compensate for the mistake and as an incentive to return. The apology has to be tangible.  Five hollow “I’m sorry”s from a minimum wage Walmartian mean nothing.

“The best way for a retailer to say, “I’m sorry” is to quickly solve the problem.”

Finally: Retailers collect too much data. This is especially true of online retailers and service providers like cell phone companies. While collecting customer data is important in diffusing frustration from a bad experience (when the first three topics in this article are ignored) retailers miss two key steps in customer data collection: 1. Customers should be compensated for their data. 2. Customers should receive an acknowledgement that their data made a difference. It is frustrating to throw your personal information and opinions into a black hole and never know what happened to them.

This list is short but each of these items forms the foundation of building a loyal customer base. That is the key to profitability.

People shop at Walmart because they have to. People shop at Target because they like to. If you were a retailer, which customer would you rather have? If you’re a customer, which experience would you rather reinforce?

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