RSR Research: Stores Say They Need More Knowledgeable, Tech-Enabled Employees
By Steve Rowen, Managing Partner
Through a special arrangement, presented here
for discussion is a summary of an article from Retail Paradox, Retail
Systems Research’s weekly analysis on emerging issues facing retailers.
In our
just-released annual report on in-store technologies, The Customer-Centric
Store 2010: How Retailers Engage Tech-enabled Customers, we wanted to
know how stores plan to contend with a smart phone-armed customer who has
more power in her hand than does any employee in the store. What we found
was actually quite surprising.
First, retailers clearly recognize the in-store
customer experience is in dire need of refinement — and soon. Seventy
three percent of respondents tell us this is the most important opportunity
they face this year. However, while 73 percent of respondents tell us this
is the most important opportunity they face this year, it is their united
view of the means to that end that is so fascinating: the most widely selected
subsequent opportunities all point to an employee base with more time, more
knowledge, and more of the tools required to make both a reality someday.
Fifty-four percent of retailers say that more personalized attention from
store employees is an absolutely vital component to differentiate the store
experience from an online retail transaction. This flies directly in the face
of the increasingly pervasive notion that customers enter stores already armed
with everything they need to make their decision, whether attained through
online research at home, or via a quick-and-dirty mobile scan either en route
to or once in the store. However, it is heartening to see that retailers have
not "thrown
in the towel" in apathy: only nine percent cite personalized attention
from employees as not important. Instead they recognize a viable chance to build
an associate base that drives significant value — and perhaps even preference
— for the in-store shopping experience.
Further, even when thinking about technology
opportunities, this year’s
retail respondents are considering the practical use of technologies in the
hands of their store associates.
Retailers tell us the biggest upside lives
with technologies that empower in-store employees: 49 percent cite these as
"very important." Forty-two percent highly value the ability to locate and
sell merchandise from anywhere in the company, helping store associates save
the sale even when a product may be out of stock, And 50 percent say that
the opportunity to make their employees more productive — no doubt a function
of both task management technologies and revamped internal review processes
— is of primary importance.
Discussion questions: How should stores plan to contend with the
legions of customers with smart phones? What do you think should be the highest
priority focus of in-store technologies?
Technology can empower employees, but unless they have base knowledge of the products and how they fit into consumers’ lives, along with a passion for superior customer service, the technology will be wasted. If they solely rely on technology, employees will simply have the same knowledge as consumers. Employees need to know more about the products and should be able to articulate the benefits consumers will receive from the products. This isn’t rocket science. It takes retail management that is committed to creating a consumer-centric environment in their stores.
Store operations in general is the most under served user community in retail. The entire emphasis is on reporting results. Almost nothing is done to help them focus. Analysis is discouraged by all levels of management who believe that customer-serving associates should be “selling not spending their time on the computer.”
Worse, most IT infrastructures make it very awkward to provide exception reports that only highlight recurring problems and opportunities. Most stores deploy broadcast emails as if the store were a person, rather than a series of specialists. As a result, store ops keeps falling further and further behind as headquarters initiatives result in a barrage of directives.
Meanwhile, the smart-phone equipped employee has no way to engage with his company’s information system. And the smart-addicted customer also has no point of engagement–like two ships in the night looking to make a connection.
It is definitely time to rethink the problem–and mobile technology is an answer. But behind the phone and firewall, the IT infrastructure needs to align itself to the real responsibilities of store ops: Staffing the stores, getting ready for promos, rewarding strong performance, managing local expenses, seasonal transition. For each of those, the Playbook includes dashboards, exception reports that drive action, and coordinated analysis.
In-store technologies should serve to increase the number and quality of personal service opportunities. Bringing the customer and the associate together when service is needed, whether it is to answer a question on the sales floor or bring another size or an additional item to the fitting room, should be the goal of any service technology platform. If the technology in the store just mirrors the online experience, why should the customer bother making the trip?
The hard part is making sure that the associates are equipped to capitalize on these technology-created opportunities. So many times systems are installed that bring the customer face to face with an associate that is poorly selected and trained, leaving the customer underserved and both of them frustrated. In-store technologies should be used to provide consistent cross brand execution of well thought out and trained service strategies.
To Mr. Goldberg’s point–employees who are able to articulate directly to shoppers the benefits they gain from products they purchase will need to develop more expertise on brands, since many functional brand benefits are mundane and literally the same across a category. While complicated, this does open the door for brands to become more focused developing a more educated fan base from within the ranks of retail employees. Social and mobile media efforts can play a big part in this effort. But delivering the “connection point” to shoppers may also require retailers to allow associates access to and permission to use their own smartphones while on the retail floor. Conversely, we may have to think more about how powerful and effective key brand “store within a store” can be in amping up the shopping experience….
What goes around, comes around.
This one line in the review sums up the entire problem.
“Fifty-four percent of retailers say that more personalized attention from store employees is an absolutely vital component to differentiate the store experience from an online retail transaction”
It is not about the technology, it is about people interacting with people and the store retailer better realize this because the online retailer is learning the lesson quickly and making customer service and knowledgeable employees available to the customer to answer questions and deal with problem part of their formula.
How should stores plan to contend with the legions of customers with smartphones? What do you think should be the highest priority focus of in-store technologies?
Stores should look at this as a positive. They should develop their own store apps and use this technology to drive more sales and better customer service. In-store technologies should focus on finding inventory the customer wants to buy. After all, sales drive revenue. Then focus on customer service.
There is no question that thoughtful technology at store level can produce a better shopping experience for the customer. Perhaps the first use of in-store technology would be to help a customer FIND an associate.
The reality is that, with tough business in an overstored environment, payroll levels have been cut to the bone. The associates that are in most stores are swamped with operational tasks and have little time to interact with customers. Investing the capital to arm these associates to be more knowledgeable and helpful sounds great, but only if the payroll levels support a dedicated sales staff. Otherwise, the capital would best be employed on helping the shopper directly through kiosks and mobile apps.
I know of one major retailer who is using mobile technologies to facilitate a better in-store customer experience. Especially with large scale department-store style retailers, customers can often feel lost among the merchandise and displays. One approach is connecting customers to a staff member via a simple text for help interaction. No smartphone is required of the customer in this instance; just a standard feature phone will suffice. Aside from helping customers find what they need quickly, this has the added benefit of collecting data in an automated fashion that can help inform a better store layout.
Another approach provides customers the ability to comment on the in-store experience via text message; long wait times, rude or disinterested staff, unclean restrooms and other variables that contribute to poor customer experience can be registered and corrected in real time. This data can then be correlated with store or departmental sales performance as a way of connecting the dots. So the net here is not about smartphones, but improving the live shopping experience using whatever means are cost effectively available.
Let’s not worry too much about the associates keeping pace with the smartphone armed legions. Those shoppers who wish to use smartphones aren’t going to be overly dependent on the associate anyway. Those who are dependent on the associate don’t care as much as the phone.
The question to me is, what is the new role of the associate in this environment? What is the associate bringing that the phone cannot? Let’s not have the associates competing with the technology, rather, complementing the technology with a something uniquely human.
Focusing on educating retail employees on customer service is probably going to be more effective than trying to ensure employees have excellent customer service AND outstanding product knowledge. Overall, product knowledge advantage goes to online retailers, period. Exceptions exist within specialty retailers of electronic products but as Susan Rider suggests, brick and mortar retailers could utilize smartphone enabled technology to reduce that advantage AND provide personalized customer service.
The retailer (or app developer) who can successfully provide a service that allows users to “scan” an item and immediately read product descriptions, specs, and reviews, will have a decided advantage over their competition and begin to close the gap on click and mortars relative to product information.
The great opportunity stores have is presenting clear, convincing, and interesting, informative Reasons to Buy (RTB) in a physical format that has a presence throughout the store. The store is the most important media platform which few retailers are effectively using to sell more products. And when shoppers buy more of retailer’s products, sales and profits increase and the shopper receives the benefit they will appreciate. A RTB physical program benefits shoppers, retailers and CPG manufacturers.
When a RTB program is done effectively (which is rarely done) it provides reasons to more fully shop the store. And such a physical program enhances employee knowledge while enhancing employees’ communication with shoppers. Reason to Buy messages are retailers’ added virtual employees (similar to an ATM machine) that they don’t have to pay $8-10 per hour for.
Retailers are being presented with an opportunity to enable their staff to present outstanding customer service to customers. It is going to take extensive and continual training by management; but it is doable.
Yes, some–not all–consumers come in armed with the latest technology. But they are coming in looking for something this technology does not afford them. How can they obtain the knowledge they are searching for without the assistance of in-store trained staff?
This brings up other topics such as how to train and how to retain employees once they are trained. Retention is an important factor as it allows for more confidence when a customer thinks about where to go when she needs information.
I recall three large retailers all selling similar products. Word of mouth said to visit a particular one for price. Another word of mouth said to visit for knowledge. The third you visited to get the best value after receiving the information necessary to make a decision.
For the first part, it would be great if a tech savvy employee could show a potential customer some online resources that the customer could only access with an in-store purchase. Maybe there is a special ride planning site if you buy a mountain bike, or a six month online magazine subscription, or some other benefit that can only be received with an in-store purchase.
As far as in-store priorities, “keep the shelves full” is the age-old goal for store technologies. Everything from determining shelf allocations to prioritizing receipt processing has the same goal: to make merchandise available for sale. If the customer can find the products they came for and they are priced “fairly,” the store will make a sale.
The future of self-service retail continues to be SELF-service, not store staff. Most of this discussion is seriously misguided, as if 100 years of failing to sell is now going to be rectified by training staff, when the shopper is already armed with their own personal selling assistant–the iPhone or its ilk.
The giant-killer retailer of the future will be the one who leverages the technology that shoppers are bringing into the store–and it is happening. Liz Crawford says: “Those shoppers who wish to use smartphones aren’t going to be overly dependent on the associate anyway.” Right ON!
Customers are already overloaded and confused and dealing with a salesforce that is not going to engage them in an effective manner is a challenge. Customers/consumers/brand participants want to be informed and educated. The paradox of information overload is an issue that is not going to abate anytime soon.
There is not a paucity of information in the market, it is the exact opposite. Too much information, too many choices, and consumers who are in “control” of the conversation. That is a HUGE challenge for all of us.
Hiring associates with the right experience, skills and technological capabilities and understanding is among the most important challenges retailers face today. If you think I am over-stating the situation, let me share with you an experience I had at my neighborhood Apple Store earlier this year. I had purchased a new Apple laptop and was about to go on my first trip since buying the new computer. I needed a new electrical adapter for the American Airline’s in-seat power.
I went into the Apple Store and asked the young man for the adapter. He looked at me as if I was speaking to him in a language he didn’t understand. He went to another associate and asked about the adapter and was directed to the back room of the store. He came out with the adapter and said “I didn’t know they had electrical plugs on airplanes.”
The problem here was not that he was young. It was that he didn’t know anywhere near enough about how and where customers use laptop computers or what the Apple store sold. Knowing as little as he appeared to know I can’t imagine why he was hired and why Apple put him on the floor serving customers.
If this is an issue for Apple it’s easy to see how it can be an even bigger challenge for retailers selling products other than electronics. After all, we are living at a time when customers very often know more about technology, how to use it to compare prices and stores and how to use the Internet and social media to share any complaints they have with thousands of other people.
What they really meant to say is they can’t find enough tech-enabled employees at minimum wage. If business believes that employees are the key to their future, then why do they insist on hiring the very worst available worker? If they provided a career path and some incentives they could attract and motivate employees who could actually make a contribution to the success of the store.
I really think this is due to the fact that most current management is the best of the worst. They are not the creme that has risen to the top, but simply milk that did not sour. They rose because in comparison to the norm, they met very low expectations. They were uninspiring when hired and promoted to fill an opening–a social promotion. Only one in one thousand of these can muster any charisma and motivate anyone. There are plenty of tech-enabled intelligent kids out there. The problem is there are few retail managers able to inspire them. The tech problem isn’t an employee problem!
Personal experience is great and technology can help enhance that experience and service level. I’ve had several very cool experiences recently where a “store” used technology to both answer my question as well as create a bonding experience with the associate.
I was recently at a car dealership who had a very knowledgeable rep. I eventually asked him a question he didn’t know the answer to. He walked me to a giant flat screen monitor that had their own application and he walked me through to the answer in seconds.
Same thing happened in a hotel in Columbus. Big monitor on the wall where employees could walk me through finding any info I wanted on the hotel, nearby attractions, etc.
I think stores, especially stores like Best Buy would find this helpful. The kids are usually knowledgeable to a certain extent, but there is only so much you can know about thousands of electronics by different manufacturers with new versions and models being released weekly.
We must remember that most customers are looking for a solution to a problem. They are buying something to meet a real or perceived need. Our sales representatives may be knowledgeable about the products they are selling, but unless they learn to probe for the customer’s needs and translate what the product will do to fit that customer’s need, they will never be successful.
Ultimately, customers want the same things from their shopping that we do in life — we want to be remembered, and we want to feel like we matter. In-store technology provides the tools to enable the store associate to help accomplish those goals.
By providing customer transactional history, potential needs and background, in-store technology can facilitate a closer, more valuable interaction between customers and associates. However, remember that training is the key difference between a successful, relationship-building interaction and just plain “creepy.”
As the new technology evolves, training of retained, engaged associates must evolve with it, for the technology investment to be successful.
Here’s a simple solution – provide free wi-fi to your own website.
Even better – make it a different website than the one accessed from the WWW. Make the shopper come to your store to experience something different and memorable.