40% Of American Retailers Are Not Measuring Customer Experience!
I saw some new research on US retail published recently. The survey features feedback from over 300 US retailers and one statistic jumped out when I started reading the summary. Although 96% of retailers questioned say that customer experience (CX) is a core priority for their business, 75% say they have room for improvement and 40% have no process in place to measure their CX.
Wow. 40% of US retailers cannot even measure the experience their customers have with their brand? With the multiple challenges faced by American retailers today – many of them structural and out of the immediate control of the retailers – it seems that this is one area where executives can make a major and immediate impact on their business.
Let’s get back to basics. Every executive knows what Return On Investment (ROI) means. Every time you need to justify your budget or propose a new idea that requires investment, you write a cost-benefit analysis. If we invest $1m in this new project then it looks like the result will be $5m in new revenue generated inside one year – that’s the kind of project that gets approved.
So how can 40% of American retailers not have any data on their customer experience when almost every retail analyst will tell you that CX is the number one strategic priority for retailers today? Customers who enjoy great CX from a retail brand stay loyal for longer, they spend more, and they tell their friends. The outcomes from great CX are positive and can be measured.
The first step for this 40% of retailers is to explore their customer journey. Before measuring anything else you need to understand:
- How did the customer even become aware of your brand or products?
- What convinced them to try out your brand?
- How do they think you compare to the competition?
- How did they like the process of making a purchase?
- Did they experience any problems and were they resolved?
Learning about the path your customers follow today is a bit more complex than it used to be. Traditionally customers would become aware of a product or brand because of advertising and engaging with a retailer would mean visiting a store. Today the use of apps, online shopping, social media, and information sources such as review sites mean that the journey customers take from awareness to purchase to ongoing loyalty is harder to track and document.
But it is possible. Ask me about some of the retail brands Praxidia has worked with. Retailers cannot start improving the customer experience if they have no measurements or data points to indicate where problems exist or where they should focus.
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Photo by Om licensed under Creative Commons.