3 Variables to Measure When Optimizing Customer Experience
The number one area every company needs to improve is customer experience. Customer experience can make or break any retailer, but it is especially true with brick and mortar establishments.
Most retailers think they are doing an awesome job with their shoppers — but research shows just the opposite, and in a resounding way. One study said that more than 80% of retailers thought customer satisfaction was high, but only eight percent of customers surveyed agreed. Eight percent is very dismal.
Think online competition will lessen the importance of knowing your customers? Think again: As according to a Walker study, by the year 2020 customer experience will overtake price and product as the key brand differentiator.
But, you say, your customers are the eight percent! Let’s see:
• Are they loyal? What is your customer retention rate?
• What are customers saying on social media and what is your strategy for replying?
• How are sales?
It’s likely that the answers to those questions indicate your customers are outside the could use improvement.
If customer experience (CX) is in a few short years going to be so important, it’s crucial to start preparing now. There is plenty of time if you start crafting a plan immediately. Here are areas to consider studying.
1. Measure loyalty
How many customers are repeat shoppers from a year ago? How many times have they shopped in the past year? If you go back two years, can you find a pattern? Good results and bad ones are both insightful. If you don’t have a loyalty rewards program, now might be the time to implement one. Make the sign-up process simple, and keep reward offerings fresh to keep customers interested. Loyalty programs should never lose money — so be careful about what is offered to customers.
2. Research the customer & competition
Look at sales details. What is selling and what is languishing? Good point of sale software can make running that type of report easy, and the payback is immense. Then, look at the competition and discover what it is offering, and at what price. What is the customer experience like at your competitor? Your customer has many choices; figure out why he or she would want to buy from you and then offer those products and services.
3. Monitor Social Media
See what is said about your company by employees and customers. Act on it. Also learn what brands are popular. Can you offer them — or a smart alternative? Respond quickly to any posts directly to your company, even if it is just to let the customer know you are acknowledging the problem and will have an answer shortly. And, be sure to answer promptly — within an hour. In November 2015, Mediapost.com reported that 83% of those reaching out to retail brands on social media don’t receive a prompt response. A slow response makes new or existing customers hesitant in contacting your brand again.
In The Loyalty Effect, author Fred Reichheld said that just a five percent increase in customer retention can lead to a huge 25% to 100% increase in profit. Even if your customers are part of the happy eight percent of satisfied customers, it’s certainly worth the effort to put the effort in to keep them happy and loyal. And if they are in the remaining 93%, it’s a no brainer.
