Customer service a key factor in retail recovery

Nina Hendy



For retailers, customer service may play a big role in helping your business recover and grow into the future. Here’s how to get it right.

The shopping crowds are returning to retail environments in droves, giving retailers a much-needed financial shot in the arm after an extremely tough year.

With the holiday season fast approaching, retailers will be preparing to up their game to ensure they snare the biggest slice of the spending dollar. It’s an important factor, with Australians feeling the pinch and 44 percent responding in a recent survey that they’re financially worse off this year.

A survey, by Toluna’s Understanding the 2020 Consumer, reveals that compared to last year, 32 percent of consumers plan to cut down on the amount spend on gifts, and 35 percent are planning to spend less on Christmas social events.

It means that customer service has emerged as a crucial battleground for competitive advantage this year, with a second survey revealing that poor customer service has been letting retailers down.

But before diving into what customer service excellence might mean as restrictions ease and borders reopen, here’s how KPMG breaks down the topic area.

KPMG’s Six Pillars of Customer Service Excellence*:

  1. Empathy – show me that you understand me and that you care
  2. Expectations – provide me with the product or service that I’m expecting
  3. Integrity – be trustworthy, be transparent, put the good customers first
  4. Personalisation – show me you know and individualise my service
  5. Resolution – fix my issue with urgency
  6. Time and effort – make it easy for me and remove unnecessary obstacles and wait times

*Source: Six Pillars of Customer Experience Excellence.

Disruption creates new opportunities

Unfortunately, recent research indicates disruptions due to COVID-19 have caused customer service levels to fall. And that means there could be plenty of opportunity available for those who can buck the trend.

Thirty-eight percent of Australians are not satisfied with their most recent retail customer service experience, and seven out of 10 (71 percent) have abandoned an online purchase at checkout in the past 12 months, amounting to an estimated $3.17 billion in lost revenue.

The information is published in the LivePerson Customer Conversation Report, which is based on a survey of 1,500-plus consumers across Australia and New Zealand, among other countries. They were asked about their customer service experience in 2020, what has changed for them, and what they would like to see companies do better or differently in the future.

It found that 63 percent missed retail shopping a little or a lot during COVID-19 and 86 percent feel that physical storefronts are still important when making retail purchases. But only 48 percent feel that they’ll be shopping as normal this time next year.

Meanwhile, 72 percent say concerns about the virus make them worried about shopping in-store and 82 percent now rate ‘contactless shopping’ as important.

LivePerson APAC head of customer engagement Kate Sterling says COVID-19 has disrupted the retail sector and increased customer expectations, but in too many cases there are not being met.

While businesses cannot control the pandemic, they can improve their approach to customer care, she said.

“Customers now hold much more power. They are more judicious about what they buy, they are buying more online and they expect their questions to be answered in real time, wherever they are and through whatever channel they prefer,” said Sterling.

“The retailers that will do well this Christmas, and in the years to come, are those who care about customer experience and use technology to augment a personal approach.”

Keeping this in mind, here are six ways retailers can up the ante ahead of the holiday rush.

1. Conversational commerce: New avenues for customer service excellence

Implementing new ways to communicate with customers if they’re shopping online is already emerging as one way retailers can begin to recreate a more traditional shopping experience online. Virtual fittings are being offered by some retailers, while others are turning to social media to field customer enquiries and secure sales.

In fact, brand-customer conversations via messaging channels such as WhatsApp, Facebook Messenger or SMS have increased in Australia by 10 per cent since May this year in Australia and have more than doubled since the start of the year, according to the LivePerson research.

2. Stay proactive when seeking and addressing feedback

Melbourne’s B2C Furniture isn’t afraid to ask for feedback, adopting an endearing after-sales service. An in-house team personally follows up with customers once they have had a chance to enjoy their new purchase and asks if they are happy with the purchase.

The move has been a huge success, with founder and chief executive Anesley Clarke saying overall sales have in fact by 14 percent during Victorian lockdowns compared to the same period last year.

“I believe the most significant reason for our success related to customer service practices that we’ve adopted,” said Clarke.

3. Add value with a VIP service

Overcome the challenge of increasing in-store dwell times by offering a VIP service for customers, that they can book online. Myer, for example, offers a personal shopping service, offering guidance, tips and inspiration, which is a popular offering.

Bear in mind that for some, this may be the first time they have shopped in-store in months, so this extra level of service will be an important ‘welcome back’ moment for them.

4. Getting it right all the way to your customer’s door

Getting purchases to your customers’ front door is going to be a crucial element in upping the ante on customer service this Christmas.

Last-mile delivery provider Drive Yello chief executive Steve Fanale said speedy reliable delivery within specified delivery times will be critical for retailers.

“One way customers can increase customer service in the lead-up to Christmas is not only delivering these goods, but providing an even better customer service experience such as delivery of wrapped gifts ready to be given to their nearest and dearest.”

5. In-store service should be on point, always

There’s nothing worse than heading into a retail store and struggling to find a retail assistant to answer your questions.

For retailers operating in any category with online competitors, bricks and mortar can seem arduous and expensive by comparison. But, if you are still managing physical outlets, they will only ever be sustainable if they’re considered as part of both your sales and brand experience.

The reality is, as retail outfits begin to derive an increasing amount of their sales online, there may come a time when retail stores are run at a cost to their business.

If this is you, don’t let these costs end up hurting the customer service you offer through your physical channel — it will only result in reputational harm and further cost in the long run.

Making sure there’s enough well-versed retail staff that truly understand the products or service you are selling will be crucial. Customers aren’t likely to want to dwell in public, so making sure the service is offered promptly is the key.

Offering a discount that is only redeemable in-store can also be a great way to increase the number of shoppers through your doors. A first-in-best-dressed offer for the first 20 or 50 customers, for example, communicated via social media or email can be hard for shoppers to ignore. Alternatively, a free gift with purchase could work. Gorman run these offers regularly and stock regularly sells out within days.

6. Stay COVIDSafe

Shoppers will be looking for Covid-safe shopping experiences. And while a state-based approach is likely to continue for a while yet, the onus will be on retailers to ensure they’re applying with the local rules.

Social distancing measures, hand sanitiser at the front door for all customers and ensuring in-store customers are wearing masks where still necessary will be important steps for retailers to take. You can find out more here.

A shop assistant greeting each person entering the store can be a great option, giving customers the chance to ask where to find what they are looking for when entering the store, reducing in-store dwell times.

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