The Sad State of Customer Service

By George Anderson

According to a report in The Christian Science Monitor, customer complaints about retail stores were up 104 percent between 2000 and 2003. Many of those complaints originated from problems with store employees.

It's not a revelation to retailers that their shoppers believe the level of customer service in stores is slipping. A recent survey by the National Retail Federation Foundation and American Express found that 55 percent of retailers say they have become more committed to satisfying customers in direct response to this perception.

Some stores have found that the best way to improve customer service is to let shoppers do more themselves. The grocery industry, for example, has a growing number of operators who are returning to their self-service roots, albeit more high tech in its current form, with self-checkouts. Others such as Trader Joe's and Wal-Mart have gone the lower tech route with case-ready meat departments rather than have butchers in the store.

Others have taken the opposite approach focusing greater attention on employee training. The article in The Christian Science Monitor pointed to Wegmans as one business where training is a priority.

Company spokesperson Jo Natale said, "When people are knowledgeable, they feel more confident. And they feel better able to help the customer."

Wegmans, Ms. Natale said, tries to "expose our people to the highest reference point." She mentioned the depth of training given employees, such as a seafood specialist being taught about species sold in the store and different techniques for preparing meals.

Moderator's Comment: Start from square one -- How does the retail industry fix its customer service problem?

One of the interesting things coming out of the recent NRF Foundation and American Express research was the gap between what shoppers and retailers think is important in customer service. For example, less than one in three retailers (31 percent) thought staffing levels were extremely important to their shoppers while nearly half of all shoppers (47 percent) said it was. - George Anderson - Moderator

• With customers griping, retailers finally get the message - The Christian Science Monitor
• Retailers, Shoppers Differ on Customer Service Priorities - National Retail Federation

Most Americans hate to see themselves in the role of subservient service provider. Now, reinforce that cultural bias with an employment model that underpays and undervalues service workers and you have a model for retail disaster (actually not too much unlike what's happening in stores today). Raise the profile of the service worker; make it a career instead of a transitional phase; treat those workers with respect and dignity and compensate them accordingly and then maybe things will start to improve. Oh...yeah...thinking of the people who interact with your customers as people rather than debits on a balance sheet doesn't hurt any either.
- Ryan Mathews- BrainTrust Panelist

Retailers are beginning to acknowledge the need to engage and listen to shoppers, and implement some, if not many, of their requests.

A continuous engagement process, quarterly, or what is appropriate with shoppers, can bring very "eye opening" areas for the retailers... whether to improve, or stop, a service program, etc.

Shoppers just want to give input on what they need, and hope it betters their daily activities and lifestyle with the retailer(s). Many retailers' employee education programs use a very simple benchmark. Treat the shopper as you would want to be treated when in a retail outlet.
- Stephan G. Kouzomis- BrainTrust Panelist

Our company participates in what is referred to as "The Great Game of Business," a business model where all information is openly shared with all employees...including all financial information...and where bonuses are directly tied to overall company and individual group performance. We all feel like it is "our" company. As much as I agree with the idea of giving employees purpose and respect, humans are funny. Without a direct link of our financial potential to our behavior, impact on behavior is limited. Retailers like Hy-Vee have proven that employees provide superior customer service when they understand their paycheck is dependent on putting aside their personal issues and consistently satisfying even the crabbiest customers. More retailers need to start tying behavior and performance...to dollars.
- Bruce Vierck- BrainTrust Panelist

The biggest part of the problem lies in our (the Baby Boomers') children and the fact that we waited until later to have them. First off; that means there's less of them to fill the work force. Then we've spoiled them; i.e. they do not want to offer the simple respect commanded by customer service. Moreover, the "give away the ship" approach spawned by the likes of Wal-Mart, Target, and Nordstrom have created a more demanding customer. Like it or not; it's something we all have to deal with. We have one guideline governing all: "treat customers like you would like to be if you were one." Our belief is that most truly unhappy customers never get mad - - they just don't come back.
- JustaGrocer

It begins with changing the perception that retail doesn't offer good jobs, and only attracts workers who can't find employment in other fields. (I'd extend retail in this instance to include foodservice.) While it may not be extremely glamorous, retailing is a great career. It is nothing to be ashamed of, but I get the sense that retail workers feel that way walking around many retail shops. There are, of course, exceptions -- I've seen many great examples of retail workers with positive attitudes toward their jobs and customer interaction. But the way society looks (down) on a career in retail is directly correlated to the low opinion many retail workers have of their jobs, and this more often than not translates into poor service.

To change the perception that retail doesn't offer good jobs is a huge undertaking and will require significant resources. One of the best programs I've seen along these lines was a cooperative effort between government, education, private companies and trade associations here in New Jersey that worked to get certain types of retail training into the course offerings at vocational-technical schools. The only problem is that Vo-Tech schools have a certain stigma themselves, and so a better route would be to get such coursework into standard secondary education. It will take a long time, and no one will ever confuse a cashier with a Hollywood starlet, but the effort has to be made in order to enhance the perception of a career in retail and thus improve customer service.
- Ron Margulis- RW Commentator

Ryan's comments are right on, though he was way too gentle. This is not a difficult problem to understand - but for some reason many retailers have a death wish and perpetuate rather than resolve the problem.

One truth that fits every organization is "how we are managed is how we serve." Quality of service always reflects the quality of management. Don't spend time and money trying to "fix" the employees, at least not at first. Look at the management (I avoid the word 'leadership' deliberately) and shake up the top of the house.

The train can never get to the destination faster than the engine. Too many companies are trying to improve the railcars thinking the problem is 'down there' somewhere. You can have all the technologically advanced 'best practice' railcars and they still won't get to the goal faster than the engine. What we have in so many retail operations is an engine problem.
- Ian Percy- BrainTrust Panelist

Once again, Ryan has hit the nail on the head. I agree.

The one thing I would add is that management needs to make customer service a priority and get into the trenches now and then so they have a clear understanding of what their frontline staff faces.

Last week, I interviewed some members of the direct sales force for a cable company (now there's a job we should all be grateful we don't do - door-to-door cold calling to sell cable). Management sometimes wonders aloud why they're paying for a direct sales force when most business comes in over the transom.

These people work on 100% commission, buy their own sales materials, buy their own candy and perks for apartment building managers, work nights and weekends, and were some of the most dedicated people I've ever had the pleasure to meet -- and were not sufficiently appreciated by management. It will not be long before that attitude is reflected in their work. Oh? We already think some cable customer service is less than charming? hmmmmmm Management should spend some time working the trenches.
- Karen Kingsley- RW Commentator

Training is important, but the foundation of customer satisfaction is employee satisfaction. People treat people the way they themselves are treated.

This became an article of faith among big marketers and service industries in the 1990's. But like many other articles of faith, it is often honored in the breach. If your customers are unhappy, you should first ask why your employees are unhappy, and fix that.
- stingaree

No mystery here. The good book says, "do unto others as you would have them do unto you." Most retailers look at store labor as a cost of doing business, not a customer service. Why would there be such an increase in self scanning if this was not true. When no human contact from the retailer is better than limited, negative interaction, we have a problem. Until retailers are committed to reasonable pay, education, training and career advancement, they will continue to have high turnover and disinterested employees. It is also time for the unions to get off their high horse on work rules. By the way, just changing the name to associates from employees does nothing. Just ask the people on the floor. Wal-Mart offers lower wages, but career opportunities. Costco offers reasonable pay, career opportunities and a management that understands. We are in such a state in the supermarket where English as the first language at check-out is rare.
- Frank Dell- BrainTrust Panelist

For me, Ryan's right on the money!

There was a time when retail service workers were proud and helpful and actually made a difference with customers. Accordingly, they were given a much higher level of respect and seen as a more dignified and valued profession...not only by the customer but also by the employer. Not only is this no longer as true, but a lack of sales and customer service training further restricts any possible return to real effectiveness.

Real customer service success requires retail employees who value a customer, act with real pride, and convey a sense of ownership in the quality of the business. This does not happen by accident. It will cost money and requires inspirational leadership. To cite Ian's metaphor, we may need better engines to pull us along.
- Tom Zatina- BrainTrust Panelist

Each person who has commented on this issue has made important observations that few retailers have embraced. That so many retailers don't understand how to really serve customers may be a very good thing for those who do. Extraordinary retail companies, like The Container Store, Wegmans, Starbucks, Nordstrom and a good many other smaller companies, are using their commitment to providing customers with great service as a true competitive advantage.

It is unfortunate for consumers that so many other retailers simply fail to understand the real value in creating legions of loyal customers. And yes, there are still retailers like the ones listed above with people working in their stores who provide a level of service that is remarkable.

In Robert Spector's book The Nordstrom Way, which was published a few years ago, he referenced a sign that hung in the original Nordstrom store in Seattle. The sign said . . ."If We Sell You Well, Tell Others. If Not, Tell Us."
- George Whalin- BrainTrust Panelist

I can certainly jump on the bandwagon of concurring with Ryan, but Bruce Vierck hit the answer to George's question more squarely I think.

George said, "start with square one." Square one is always how large and how direct my personal vested interest is in something being done successfully. This is why even larger organizations can successfully engender a higher level of customer service in their employees IF they have a direct vested (usually financial) interest in the result.

But it doesn't have to be a large organization to do this. One of the best levels of customer service I regularly receive is from my local carwash. The tip containers are clear plastic, so everyone can see what's in them. And they are placed in clear view of the employees who finish the car -- in full view of the customer -- who is deciding in real time how big the tip is going to be. The team splits the tip pool, so no one can get ahead and anyone slacking off feels the wrath of the entire team immediately. A very direct vested interest. It works like a charm.
- Ben Ball- BrainTrust Panelist

One day I was thinking, almost in despair,
About the state of customer service everywhere.
I read the sage comments above and wondered why
Consultants with deep insights do retailers decry.
Then a hand fell on my shoulder and a voice said,
"The tables must be turned and the retailers led."

So, I envisioned a brand new paradigm in my brain
With consultants actually running the retail train.
A voice said, "Customer service will now become good,
With our folks operating in the retail brotherhood."
So cheer up meaningful revisionists among us today,
Retailers are ready to include us but at lesser pay.
- Gene Hoffman- BrainTrust Panelist

For some time now, retailing in many sectors has been on a steady path of devaluing the retail worker. Whether it be wages, training, benefits, reduction in staffing, centralized service points, etc., retailers have been looking at the retail worker as a means to meet their lagging bottom lines. Yet, it would seem that the natural resource in increasing the top line falls directly into the hands of the retail worker. Seems a bit odd doesn't it?

In particular, on this site we discuss consumer loyalty at great lengths based on "this new program" or "that new piece of technology" or "this new card." Underlying each and every other strategic program's intent, is the means of execution - the retail worker.

Sometime ago, I believe it was Best Buy who publicly announced that it would not go forward with a new program for its customers. This was based on their own conclusion that their workers would not be able to execute the program to their expections.

In the broad sense, customer service may be slightly worse than it was five years ago. There are bright spots among successful retailers that provide a model from which pieces can be gleaned, in order to 'fix' the overall problem at many other retailers. However, this would mean that we accept the premise that the others first believe there is a problem and, even more so, have the desire to 'fix' it. 'Fixing' it (depending upon what 'it' is), takes real work - people work. It's the kind of work in which consultants can't make quick money by introducing a technological solution or program and then walk away quickly so that results can't be measured before they are paid.

Here's a study worth doing: take the top retail firms in the marketplace and analyze them. First, qualify them as those that have the highest levels of 'perceived' customer service. Look at the following:

• What is their percentage of technology investment directed at customer service?
• What is their percentage of budget directed at top line improvement versus bottom line improvement?
• What percentage of their top line improvement budget is directed at training and execution management?
• What portion of their overall evaluation is directed at measuring customer service performance?
• How is customer service performance measured?
• What incentive is in place to enhance performance?
• What is their wage structure?
• What is their benefit structure?
• What is their turnover rate?
• What is their percentage of overall training budget to their annual budget for other purposes?
• How many times a day does the topic of customer service get discussed? (At all levels)

And most importantly in regards to the last question, if that isn't happening at least several times in every hour, then their level of engagement is not high enough to ensure that their real intent is to 'fix' it.

- Scanner

I forgot who said it, and if anyone does, please email me so I can appropriately attribute it to them going forward, but they said wisely, "If you want your employees to give service with a smile you must first give your employees something to smile about." Training is important. Creating the right work environment is paramount. The fact is that most of us do everything we can to not engage store staff because they are so miserable.

Be a great place to work and you'll be a great place to shop!
- Doug Fleener- BrainTrust Panelist

Sounds like this has been covered. Nonetheless, most folks miss this. The primary target audience for the retailer must be the associate on the selling floor.

If the associate is treated like a customer, then the associate will not take an "us v. them" attitude on the floor. Plus, they understand the consumer expectation of the brand when they engage the customer on the floor.

Retail is detail.
- IMRetail

Replacing staff with more opportunities for DIY does not solve the customer service problem, it simply shifts the onus onto the customer. That is not service no matter how you look at it. Ignoring an issue has never made it go away.

As with the philosophy of curing addicts, the first step is acknowledging that there is a problem. The second step is deciding that it's time to fix it. The mismatch found in the NRF survey highlights the fact that not everyone in the industry has reached either of those steps. There has got to be a greater understanding of what retailers, employees and customers want from a shopping experience before remedies can be identified or implemented. And even before that, there has to be a recognition that ALL interested parties are equally important even if you can't quantify their value or attach a bottom line number to the contribution that any of them make. Our discussion last week about whether corporate social responsibility has any link to profitability is a relevant issue. Not every aspect of retail performance has an identifiable cost or revenue. There needs to be more lateral and creative thinking if levels of customer service are ever going to be acceptable to all of the people all of the time.
- Bernice Hurst- RW Commentator

The point in good service is to understand what your customer wants and how they want to buy. We sometimes confuse interacting with a sales associate with delivering good customer service. Sometimes a person is required. Sometimes a better store layout, well-stocked display, and clearly marked prices answer all the questions I have.

May we also talk about stores that pride themselves on good service ON THEIR TERMS? As a credit-card holding customer of a certain NM department store, I get tired of being treated very well when I'm buying full price, but seem to be second-class when I'm shopping the sales racks. Commissions are two-edge motivators.
- MmeX