Mark Price

Retail TouchPoints: Mystery Shopper Study Shows E-tailers Sacrifice Service For Cost Containment, Efficiencies

February 25, 2010

FROM RETAILWIRE:
Online retailers still felt the pinch of the recent recession during the most recent holiday season and many chose cost containment over improvements in customer service in Q4 2009, according to the e-tailing group's 12th Annual Mystery Shopping Study. Where do e-commerce sites need to continue to invest to improve the shopping experience?      [more...]

In e-commerce, the connection between customer service and revenue is easier to calculate and more dramatic in impact. E-tailers who cut costs and short the experience of customers, particularly Best Customers, will find themselves in hot water in a direct, calculable way.

Why is this so? Because all transactions online are captured and most customer information can be relatively easily linked to that transaction information. Therefore, it is not difficult to calculate annual and a projected 3-year value, and to determine which customers, after a customer service experience, demonstrate a decline in click/open rates as well as a decrease in sales.

In a cost-sensitive environment, it is critical to maintain or even improve the experience for Best Customers, the small group of customers who represent 50%+ of revenue and an even higher share of profit. Through such approaches as priority 800#s, queuing technology and faster response to email, those high value customers will receive treatment that will improve, not damage their relationships, and the company will experience business growth as a by-product.