Photo: Wegmans
Trader Joe’s and Wegmans satisfy, others falter, through the pandemic
In-store grocery shopping experiences since March have, by-and-large, not been a lot of fun. Some retailers, however, have managed to provide the kind of service experience that customers are looking for despite an environment of restrictions and uncertainty. A new survey shows a few in particular, already known for their customer experience, that have managed to maintain high customer satisfaction levels even in the midst of the novel coronavirus pandemic.
The American Customer Satisfaction Index (ACSI) released its Special COVID-19 Retail Study, which listed a few familiar names again at the top, despite an overall downturn of 3.8 percent in customer satisfaction at supermarkets. In the survey, Trader Joe’s and Wegmans tied at the top with scores of 84. Publix and Costco came in slightly lower at 83.
All four retailers had performed well in the ACSI Retail and Consumer Shipping Report 2019-2020, the organization’s yearly report released in February. In that report Trader Joe’s was at 84 points, having slipped two percent from the previous year. Wegmans was also ranked at the top for satisfaction.
H-E-B, which was a top performer along with Trader Joe’s and Wegmans in the earlier report, dropped two points during the pandemic. Most notable in terms of grocery losses, both Target and Whole Foods dropped four percent and, in e-tail, Amazon dropped seven percent.
Trader Joe’s has remained on top in the customer service rankings despite forgoing some of the services that grocers have come to see as necessary in the pandemic era; the chain has implemented neither delivery nor curbside pickup.
Part of Wegmans’ success may be due in part to its adjustment of SKUs in order to prevent out-of-stocks at the first peak of the pandemic, when panic buying left many grocery store shelves empty nationwide.
Amazon’s low scores track with its high-profile stumbles made early in the pandemic. At the onset of the pandemic, customers ordering from the e-tail giant were subjected to unprecedentedly long wait times and having non-essential orders placed on hold as the company struggled to meet the new pandemic-era demands.
- Amazon Falters During COVID-19, While Costco, Etsy, and Nordstrom Take the Internet Retail Crown, ACSI Data Show – BusinessWire
- ACSI Retail and Consumer Shipping Report 2019-2020 – ACSI
- Can Trader Joe’s continue thriving without delivery and curbside pickup? – RetailWire
- Will Wegmans need a post-pandemic makeover? – RetailWire
Discussion Questions
DISCUSSION QUESTIONS: Why do you think Trader Joe’s, Wegmans, Costco and Publix have been able to stand out for customer service even during the pandemic? What do you see as the most immediate solutions to maintaining and improving customer satisfaction levels at this point in time?
Poll
BrainTrust
Mohamed Amer, PhD
Independent Board Member, Investor and Startup Advisor
Cathy Hotka
Principal, Cathy Hotka & Associates
The way Trader Joe’s, Wegmans and Costco handled social distancing and masks during the pandemic while maintaining great customer service is why they remain at the top of the list in customer satisfaction. Trader Joe’s severely limited the number of people in their stores which created long lines outside the stores, but loyal fans appreciated the safety while shopping in the store. Costco managed limits on hoarded products during the initial phase of the pandemic very well and included signs outside that indicated what items were out of stock. Moving forward in an environment where health and safety are paramount concerns for many shoppers, retailers will need to provide safe shopping experiences for the foreseeable future.
Trader Joe’s and Costco are two examples I would also use to show how to do it the right way. I have been to both several times since the pandemic started. Both are doing an exceptional job keeping us feeling safe during the shopping experience.
They remained focused on their value proposition. These were well thought of retailers before the pandemic. They continue to do the things that differentiate them now. The key is to understand your customers and to understand your strengths and figure out how to continue to deliver on those strategies in a way that’s safe for customers and employees.
The results of this new survey are not much of a surprise. Retailers who hire people with job ownership and who care about other people will always be able to rise to the occasion because it is in their DNA.
The loyalty built over the years kept customers engaged and patient even when inconveniences surfaced. The lessons here are mostly related to building and maintaining a company culture that is customer-centric. Of course changing a company culture is hard, but without the right culture it is equally hard to build for the long-term because you have no idea what percentage of today´s existing business volume will return next year without massive acquisition campaigns.
Leadership based on the right values is just as important today as it has been for centuries.
The secret sauce has been and will remain the company’s culture. If you begin with a culture that dignifies associates and highly values customer service, you will withstand the wind shears of a pandemic. Alternatively, if you ignore culture and customer, the pandemic-induced storms will shred your sails as you struggle to remain afloat.
These brands already being built on great customer service gave them the right approach automatically. Everything is built around trying to make the experience the customer has as positive as it can be. Wegmans had people wiping down the pin pads (likely damaging them in the process, but that is a tech understanding issue) almost immediately. Proper spacing was put in right away. They got that it was about making people feel as safe as possible.
The article referenced what I feel is the most important solution to improve — inventory. Making sure that the shelves stay stocked with the desired items, or that there are reasonable alternatives available.
The grocers mentioned here are thriving because customer experience was baked in at the start, not tacked on later. Their rich history provides a platform for further enhancement as shopping continues to evolve.
Customer-centricity was key for brands like Trader Joe’s, Wegmans, Costco and Publix to stand out for customer service during the pandemic. Customers appreciate the transparency such brands provide to show how they are keeping them safe while meeting their needs.
In the wake of a crisis, be it a pandemic, economic – really any type of crisis – a good company’s traits are magnified. Same for laggards. That’s why Trader Joe’s, Wegmans, etc. have done well. They already had a focus on their customers. For others, take a look at why people like to shop at these rock star retailers. What are they doing differently? Those differences are often easy to spot. Now you know where to improve. That’s the starting point – comparing yourself to the rock stars in the industry. That said, it is even better to study the best companies from any industry. What are they doing during the pandemic that you are not, and that you could be doing? Answer that question and you may see the “most immediate solution” to maintaining and improving customer satisfaction levels.
I think these chains stand out at least in part because they started with a more loyal customer base than their peers. Like everything else in life, if I like you I will tend to be more forgiving of your shortcomings, especially if you are still outperforming the competition. These five firms have different customer engagement policies, so I think it’s less a case of having one “magic bullet” to keep service levels up that can be copied by all, and more a reward for decades of dedicated customer service. And, all of these companies not only gather mountains of data, they actually do creative and insightful things based on their analytics. Put another way, while some supermarkets have been “listening” to their customers, these four chains have been “hearing” what customers have been saying pre-pandemic. If you are looking for a starting point to improve customer service, this wouldn’t be a bad beginning.
One consumer benefit of in-store shopping is immediacy, we go out to shop because we want to get an item right away. When you combine immediacy with outstanding customer service and strict adherence to CDC recommended safety measures, such as social distancing, requiring face masks and having hand sanitizer readily available, you build trust with the consumer and earn repeat business. Grocery stores are an essential business through the coronavirus pandemic and those that combine safety with the convenience of products being in-stock and then step it up with attentive customer service will shine, throughout the pandemic and into the New Normal.
Providing an outstanding customer experience is critically imperative for grocery stores, especially as we collectively navigate the pandemic’s uncharted waters. Trader Joe’s, Wegmans and other grocery stores were already well-positioned and had the right customer-centric operating model leading into the pandemic.
They have especially seamlessly shifted their operations to stay true to their brand promise and not compromise the customer experience while keeping their store associates and valued consumers safe and secure. Loyal customers will continue to return for more if they feel safe and secure during these uncertain times.
The situation is very dynamic, and all retailers have to stay very aligned with the CDC protocols.
I don’t live in an area with Wegmans or Publix. However many people have told me they either only shop at Costco or really appreciate the way Costco and Trader Joe’s enforced mask wearing, the number of people allowed in the store, and social distancing. It makes them feel comfortable shopping. At the same time they set up plexiglass and enforced mask wearing by employees to protect their employees.
Trader Joe’s is the store next door. Compared to shopping other large chains, customers are greeted by happy, positive associates through the entire shopping experience! No edge, no tossing your food on to a fast running conveyor belt, with your food piling up as you, the shopper, rush to prevent it from falling on the floor while the person checking you out acts oblivious — as a cover to his/her anger towards you and your mere existence. One can’t make this up!
Costco is friendly. A shopper does not feel like the enemy in the eyes of the Costco associates when shopping Costco. The bottom line, big grocery uses its employees as replaceable, revolving cogs in an everchanging human associate landscape of dismissive corporate leadership which, guess what? Results in dismissive customer experiences.
Big grocery take notice. Shopping at Trader Joe’s is neighborly, featuring good prices, interesting and tasty food offerings, and a place where the employee is valued resulting in top customer experience ratings for Trader Joe’s. It’s pretty simple, human logic. In the end it is always about the intangibles. Treating people well is cheap.
The answer to the question is easy. They care about their employees, they care about their customers and they attempt to do the right thing because it is the right thing to do.
They have values and live by them.
Prior to the start of the pandemic, these four grocery brands were already the standard-bearers for customer experience execution, culture, brand promise, employee engagement and customer loyalty.
The deep and abiding customer trust these retailers have carefully built and nurtured over decades provided a firm foundation for transitioning to the pandemic-era customer service realities.
Consumers implicitly trusted these brands to create safe shopping environments, while also looking after their frontline associates. For Trader Joe’s, Wegmans, Costco and Publix, delivering on customer experience is a fundamental part of their DNA.
These four retailers have been at the top of the ACSI ratings for years. Why? In simple terms, they dignify their customers by first learning of their key needs and then going beyond in satisfying them. For each of these retailers, it is not about doing one thing 100% better than their competitors. It’s about doing 100 things 1% better than the trailing retailers.
Going forward, the keys to maintaining their customer satisfaction levels are as follows: 1. Continue to do all of the little things that delight customers. 2. Reduce out of stocks. 3. Improve the BOPIS option.
TJ’s, Wegmans, etc. have established loyalty and in some cases, almost fealty from customers, through unique sets of products and experiences. The experience in a Costco or Wegmans is vastly different than others. Combine that with specific unique values stores like TJ’s provides — e.g. private label and non standard products not found in other stores — and you have ingredients for success.
TJ’s has that natural guava juice you just won’t find at your local supermarket. Costco with super attentive associates paid higher than the market, or Wegmans with unique store formats in the mall. The fact is, these stores have established unique characteristics that make them memorable, valuable, and customer centric — making customer satisfaction an afterthought as it’s part of their very DNA.
Based on my experience in San Diego, Trader Joe’s executed the best during the height of the pandemic in grocery retail. They are well-run organizations and if you visit several different stores, you notice that the safety protocols are similar and the customer service is consistently great.
One aspect of customer service that everyone needs during these times is a touch of humanity, cheer, and connectedness. The cashiers at Trader Joe’s are the best at this and for many shoppers that are isolated, it could have made a difference in generating these high customer service scores.
I still remember visiting Costco in April and being impressed with the thoughtful execution. Easy to understand social distancing tactics (no maze-like arrows everywhere), restrictions on the number of shoppers in stores, orderly management of huge lines, highly visible sanitation. A lot of these things are standard now, but in April, it was well before many other retailers had implemented clear policies. Taking an early stance and providing clear guidance during times of distress, even at a higher cost to the company, made a memorable positive impact on shoppers.