“Customer experience is the next competitive battleground. It’s where businesses are won or lost.” –Tom Knighton
Ever wonder why we still do what we have always done for the same or similar result?
More important now than ever before, with the determined and continued growth of online retail and the entrance of new and foreign competitors, the answer to this question could well determine who stays – and who goes.
Imagine spending approximately 5c in the dollar and hoping for a consistent $1.00 in return?
One of our business units provides Mystery shopping and in over ten years of this service, there are some very consistent trends among the many thousands of surveys that we have conducted.
Firstly, the overall level of speciality customer service hasn’t significantly improved – in fact overall it’s static.
Building relationships, opening the sale, adding on and closing the sale tend to be the key areas to train sales people in or slight variances to this.
Product knowledge training underpins a great deal of confidence within a sales team member as does the skills in active listening.
Now that 5c investment in the dollar tends to be the direct spend on training on average across many speciality retailers.
Even that 5c dilutes dramatically when we factor in staff turnover – and the real effect of the training investment may be closer to 2c.
And so we see that the base investment, for many Australian bricks and mortar retailers actually isn’t enough, in the face of online and global competition.
Much of the average speciality retail experience is actually that.
Upon reflection, it is easy to see how bricks and mortar retailers begin to lose their appeal. Disaffected service, customer enquiries not returned, uninviting presentation of stock – all these are part and parcel of a larger, much more prevalent and “unfit “retail. Companies that do not address these experiential issues begin to experience other symptoms: lack of engagement, lack of direction, lack of loyalty and, worst of all, lack of passion and of course, lack of the right people
Fortunately, the alternative is clear. “Experiential retail” is the front on which reputations are being staked, and consumers are engaged.
A stellar example is the “creators of amazing moments”, The Grounds of Alexandria in Sydney. The ethos of this company is built around four pillars of experience: escape, educational, entertainment and personality. Featuring a coffee roastery, cafe, restaurant, sustainable garden, pop-up experiences and even an on-site city farm, the team at The Grounds refuse to be “just another hospitality business.” Organic word-of-mouth and experience sharing is one of the most powerful forms of referral a business can enjoy, and experiential retail delivers.
Finally, we return full circle to the topic of the day: what business are we in? Are we in the business of making coffee? Are we in the business of selling suits? Or are we in the business of creating amazing customer experiences and fond memories?
Food for thought.
First published InsideRetail on May 10 2017
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