The worst public relations for retailers is generated by their own customers, new research shows. Negative experiences with retail sales people leave such a bad taste in people’s mouths that negative word-of-mouth often creates an image precisely the opposite of the one companies are spending millions for with their advertising, promotion and public relations programs.
The new survey, the Verde-Wharton Customer Dissatisfaction Study, show that the actions—or inactions—of retailers’ sales associates also result in customer losses, undoing the work of millions of dollars of advertising, promotion and PR spent to bring them into stores in the first place. It concludes that Americans regard front-line staff to be the single biggest detriment to their shopping experience, resulting in more lost business and negative word of mouth than any other problem.
The Retail Customer Dissatisfaction Study was conducted for the second year in a row by the Verde Group, a leading customer dissatisfaction consulting firm, and the Baker Retail Initiative at the University of Pennsylvania’s Wharton School. Researchers compiled data from 1,000 American consumers surveyed in March, 2007.
According to the survey, one in three customers spreads negative word of mouth about their shopping problems and each person tells an average of four others.
Says The Verde Group’s president, Paula Courtney, customers complain about “everything from the disappearance of salespeople when they’re needed to long check out lines, to over-solicitous and insincere salespeople, to simply being ignored is alienating American shoppers and losing big bucks for retailers.”
The study found that not being able to find a salesperson is the most critical retail shopping issue of all and is experienced by 33 percent of all consumers who reported a problem. Many of these shoppers are so annoyed by the lack of sales assistance that they won’t go back to the store at all. Equally damaging to business is that 25 percent of all consumers who report a problem when they shop are ignored by sales staff, receiving not so much as a smile, greeting or even eye contact. This turns three percent of customers away from the retailer permanently and is the number one problem customers are likely to share with others.
“And share they will,” says Stephen Hoch, director of the Patty and Jay H. Baker Retailing Initiative at the University of Pennsylvania’s Wharton School. “One in three customers spreads negative word of mouth about their shopping problems and each person tells an average of four others. Interestingly, it’s the younger consumer between the age of 18 and 29 that is least satisfied with their shopping experience and the older you get, the happier you are with your shopping experience.”
Adds Courtney, “US retailers are not improving or paying enough attention to the front line competencies that are required to win and retain customers. This is particularly true of ‘Category Killers’ – large retail chains that dominate their product category, as no matter what time of year it is, they are responsible for the greatest number of shopping problems (66 percent). Consumers rate department stores better, but shoppers still report problems 52 percent of the time.”
The Verde Group and the Baker Retail Initiative at Wharton have identified the four core competencies salespeople must have in order to drive loyalty and keep customers coming back for more. They are:
• Educator – explains products, makes recommendations and tells the customer where items can be found.
• Engager – approaches the customer, smiles, makes eye contact and helps the customer no matter what else they are busy doing.
• Expeditor – sensitive to the customer’s time constraints and helps them speed through long check-out lines.
• Authentic – lets customers browse on their own if they want and is genuinely interested in helping regardless of whether a sale is made or not.