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[19 comments]

Retailers can learn a lot from the hospitality industry

April 15, 2014

Through a special arrangement, presented here for discussion is a summary of a current article from Retail Customer Experience, a daily news portal devoted to helping retailers differentiate the shopping experience.

I recently bought a new house, a purchase accompanied by several trips to a home improvement retailer. It was the same retailer each time, but each trip was dramatically different.

During one of my first stops, I asked an associate where to find a certain item. He pointed in a general direction and gave me the aisle number, and I went on my way, only to end up more lost than when I started.

At the same store on a later date, I asked a different associate the same question for a different item. She promptly walked me across the entire store and led me exactly to it. It was completely unexpected and I was amazed by her willingness to go the extra mile (or at least 50 steps).

It's experiences like these that underscore how incredibly low the bar is in retail customer service. Fulfilling even the most basic aspects of customer service has become a cause for celebration.

In my opinion, two factors are driving this inconsistent customer experience:

Overemphasis on value: Because consumers are so empowered and price-conscious today, retailers have slashed prices to drive shoppers into their stores. This pursuit to the bottom, however, neglects the service component once customers are inside. It's not enough to have one designated employee in charge of "being friendly and helpful" as shoppers enter. This desire to help should be instilled in every worker.

Overemphasis on efficiency: Associates are trained to maximize efficiency in all aspects of their work: to stock shelves as quickly as possible, funnel a steady stream of customers through the cash register, and so on. An unintended but frequent outcome of this approach is that the customer's needs take a backseat. The customer almost becomes a conflict of interest: "If I have to help you, I'll be distracted from finishing mopping the floor before my break."

Retailers would do well to borrow from hotels' playbooks. The staff at every Marriott or Holiday Inn, maintenance, housekeeping the concierge desk, etc., have all been trained to reach out and connect with guests. They make a human effort to make guests feel welcome.

Transforming culture simply requires a shift in focus, where friendliness and helpfulness are emphasized as much as productivity and efficiency. Invite frontline employees to enjoy the "distraction" of helping customers out.

Discussion Questions:

Is the overemphasis on value and efficiency at the core of why customer service levels at retailers are shoddy or at least erratic? Can retailers learn from their counterparts in the hospitality industry?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Do you believe achieving superior customer service is harder to achieve at a hotel or a retail store?

Comments:

I don't really think so, at least not directly. I think the real culprit is the fact that retailing isn't a career for most employes, just a way to pay the bills.

With a workforce that would -- to an alarming degree -- rather be almost anywhere else and management teams focused on cutting "costs" -- aka labor hours and benefits -- it's hard to understand why service levels are as "good" as they are at retail.

As to the hospitality industry, friendliness by coercion isn't really a great training model either. Any of us who travel a great deal know exactly how fragile that whole hospitality industry service model really is.

There are many nights that -- based on service -- I would rather have been sleeping in a Home Depot than a Weston or Marriott. At the very least, the materials would have been on hand to fix the leaky faucets.

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Ryan Mathews, Founder, ceo, Black Monk Consulting

In this world today with price savvy shoppers demanding rock bottom prices, we as retailers are caught in a very tough spot. Profit margins are incredibly thin now, and will continue to shrink, as costs continue to rise, but somehow we need to maintain the customer service level of days gone by. I still offer very good service to my customers, and hope that it still means something to them.

I just got back from Ponte Vedra Florida, playing golf at the TPC. We stayed at the Marriot Resort at Sawgrass, and the service was incredible, which I enjoy. The issue for us as retailers is providing that level of service without going broke, and I am serious about this. There was a total of $100 in resort fees, and $200 in extra service charges on any bill you signed, which really helps the bottom line. Not complaining as this is common at finer resorts.

We cannot and will not add any fees to our bill, as we would be run out of town, so that makes it very difficult to provide that type of customer service, without sacrificing the bottom line.

This does not mean that you cannot be extremely friendly, and provide carry out service, and consult with customers who need your help. It is a balancing act to have the right staff on the floor to take care of customers needs, along with getting the work done to keep the store looking good. There is no excuse for bad service, and a friendly associate can make the difference in making the customer experience a positive one.

All of us need to realize that the customer pays the checks, and every one of my employees knows this, as I pound it into their heads, so treat customers well, and always engage with them in a personal way, and hopefully you can build up goodwill for your store.

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Tony Orlando, Owner, Tony O's Supermarket & Catering

I do not believe this is harder. While I have one client who is still at the top of TripAdvisor in Orange County, CA, it is the same sales system, customer service process I've taught to thousands of retailers.

The difference? Intention. There are a lot duties at retail, it's true, but hospitality has metrics of how long you get to clean a room and the front desk has a countdown to checking. The intention of a hotel is to get you to return - that intention is often lacking in most retailers.

Head down and get through the day never leads to an exceptional experience.

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Bob Phibbs, President/CEO, The Retail Doctor

Yes. Yes. Yes. Retail has forgotten what great customer service means, and is "stuck" on good customer service. Moving from good to great customer service seems to be reflected in the shift from good to great retailers. Go into a Trader Joe's, Wild Oats, and Whole Foods, and compare the customer service you receive there to the customer service you would receive at any other grocer and this is an example of where the differences remain. The same can be said for the large mass retailers. If a retailer puts well-trained, happy employees, performing great customer service, happy customers are certain to follow....

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Kai Clarke, President, Kowa Optimed, Inc.

Oh God...are we seriously going to look at yet another industry to teach us how to do what we already know we have to do? Last time round, the industry decided to be more like the airline industry. We all know what a success the self-service model was (not so much). And we brought in executives from manufacturing so we could get to "six sigma." And we know how successful that was (you know who you are...).

It took the hotel chains years to acknowledge that most people don't like hard-as-rock beds. Most seem to be getting the message now. But how long is it going to take for the retail industry to figure out that investing in associates makes sense?

I just don't think this is rocket science. It might require some creative math to create investment in in-store employees...but that's what it's going to take. Especially if you're selling commodities. Otherwise, why should a consumer bother going to stores? It's a pain in the neck.

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Paula Rosenblum, Managing Partner, RSR Research

Absolutely. The hospitality industry has recognized the value of the front liner. The acronym I use for the people part of the customer delight process (versus the systems component) is FIRE them up. Find them, Involve them, Empower them and Reward them.

The involvement dimension includes creating the culture of delighting customers and preparing (developing) the associates. Make a commitment (time and $) to educating your staff to delight your customers.

Empowering means not only assigning responsibility, but also giving the employee the ability to respond. This means giving employees permission to solve customer problems without needing unnecessary approvals.

Remember, success leaves clues. The hospitality industry has given us some terrific clues to delight customers.

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Richard J. George, Ph.D., Professor of Food Marketing, Haub School of Business, Saint Joseph's University

We all know the line, "That that gets inspected is respected." This comes down to what the leaders of the organization say and show what is important.

The first priority must be the customer's experience, and that's something that hospitality does fairly well. It's also something smart retailers do too. You can't just talk it, but it has to be foundational to your retail approach.

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Doug Fleener, President and Managing Partner, Dynamic Experiences Group

High street and retail flagship locations should serve as a model for all retailers versus the exclusive place to shop.

One good example is the AT&T store and Apple store that take cues from their flagship locations. But there are department stores and a Minnesota-based big box with a nice Manhattan flagship, but have locations that appear to be nothing more than a get-in/get-out experience.

Retailers should stop focusing on creating flagship stores for exclusivity and focus on leveraging flagship hospitality cues to incorporate in all locations.

Ed Dunn, Founder, (Stealth Operation)

Value, or rather "values" are at the core of why consumer experience is so poor in retail. With reduced staffing, limited training and no empowerment, store associates face an insurmountable task. They respond by leaving -- attrition of staff is one of the biggest issues facing retailers today. High turnover is driven by a lack of values -- specifically about the value that revenue and valuable customer relationships can be driven by great customer experience, and that short-term spending drives a stable and growing long-term business,

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Mark Price, Managing Partner, M Squared Group, Inc.

I agree with Gary Edwards completely on what's wrong at retail, but I think the hospitality industry is a different animal. In most stores, "the job" is keeping shelves stocked and clean, and customers in and out quickly. In hotels, at least to some degree, the focus is on the customer, and making that customer happy.

My own experience working in supermarkets as a kid was to stock shelves as quickly as possible to keep the bosses happy. And I hated getting paged to run a register when things got busy because it meant I couldn't do my "real job." And while on the register, I rang people up as fast as possible and got them out. (This was pre-scanning days, so you had to either memorize all the prices, or, God forbid, take the time to read the rubber stamps on the cans). Getting people out fast got you raises and overtime (even if you made mistakes on prices), and doing it slow got you grief and a potential job loss. I truly don't think much has changed over the years.

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Warren Thayer, Editor & Managing Partner, Frozen & Refrigerated Buyer

We work with a restaurant company that does customer service best IMO, and they start with the mantra, "the answer is yes, what's the question?" I love that.

Retailers really need to re-think hiring in the digital age. After all, a store associate is the difference between buying something online or even going to a store. Just ask Starbucks, who really gets that notion. My advice would be to start with this: hire people who like people. You have to WANT to provide service to people in order to do it right. When all the Amazon dust settles, the retailers with the best customer service will be the only ones with stores left.

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Lee Peterson, EVP Creative Services, WD Partners

As I always like to say, "Know thy customer." That also means that retail must know thy customer's preferred paths to purchase and make sure said customer is meaningfully engaged at various points along the way.

Does meaningful engagement mean it has to be by a person? Nope! There are touchpoints that require a human but not always. It is up to you, retailers, to figure this out. To para-phrase Paula, "It ain't rocket science."

And that's my 2 cents....

Lee Kent, Brings Retail Executives Together to Meet.Learn.Profit, RetailConnections

Funny that this article states the service-oriented aspects of the hospitality industry that retailers could leverage. I've been sharing these thoughts for literally a couple decades at this point. The perspective I have shared with retail clients is specifically from a loyalty standpoint. So many retailers are proud to say that 99% of the consumer traffic uses their "loyalty" card. All that statistic states is that people are smart enough to know that they will pay a higher price if they don't use the card. The truth is that most shoppers are members of multiple store programs.

If you think for a moment about hotels and even airlines, there are characteristics that consumers are drawn to that almost "force" them to stay with one brand. It can be the service levels, however it can be even more elements of the experience.

Once a retailer figures out what aspects to leverage from hospitality to their business, they will reap more true loyalty from their shoppers than ever before.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

There's no mystery here: if people want to pay prices that (only) support having a handful of people staffing a 50K square foot store, then they're going to get the level of service - or lack of same - that implies.

The comparison to the hospitality industry seems naive, at best. I would suggest Dr. Edwards peruse the reviews in TripAdvisor, Expedia, etc. to see how well his comparison of the reality of retail to ideal of hospitality stands up.

'notcom'

I've always said that good customer service people can be found in the hospitality industry; hotels and restaurants. In an interview with Jim Bush, Sr. VP of Worldwide Customer Service at American Express, he stated that they like to hire people with hospitality experience for the support centers. It's not difficult to train a CSR on product info and how to navigate the screens. Yet, it's the hospitality mentality that creates the value for the customer.

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Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC

I will take a guess that the average hospitality employee is not on call and required to work 3 hour shifts. I would also guess that they are also full-time and receive benefits.

When retail stops trying to get by on the cheap and invests not only training, which now is done off the clock and online, but also money to hire and keep people, the service will always be poor. If you ran your family like your staff, would they still want to be family? Would you want your family treated like you do staff?

Kate Blake, Social Media Manager, Take Five with Kate Blake

Many retailers have decreased staffing to such low levels that needs for stocking shelves, etc. come ahead of helping a customer, a drastic step taken to contain costs in a very competitive market. At the heart of it, the things that matter are always done well - so foodservice demands great customer service, despite low wages, difficult schedules and working conditions. Yes, there is something to be learned here.

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Anne Bieler, Sr. Associate, Packaging and Technology Integrated Solutions

The emphasis on customers at retailers is to make the customer happy at all costs. The problem is that the customers' expectations are higher and more demanding than some retailers are able to keep up with. Customers want bottom dollar pricing yet they expect to be treated with a gold spoon and are never satisfied no matter what they are given. It is an ongoing battle for the retailer whose efforts to retain a loyal customer base is losing more in the long run, because the staff have to suffer with low pay and poor treatment from customers who have become the dictators of the shopping experience, good or bad.

'Brainbrands'

In recent years some furniture retailers have been referring to their customers as "Guests." But not much changed in their approach to shoppers, so the name change has, in my highly informed opinion, accomplished nothing. This is probably due, in part, to the fact that when you sleep in someone's place of business, shower and perform very personal functions there, can order food delivered to you in your room, use their equipment for work or workouts, the whole idea of being a "guest" has meaning - except for the small fact that you have to pay.

In our business, the idea of concierge treatment has a lot of merit because of the very personal, high-value purchases that are made and the often long decision time which requires a lot of opt-in follow up contact that has to be earned by the things you do the first time.

Joe Capillo, Owner, Top Line Strategies

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