Retailer CX Fails to Impress
Though it is one of the top drivers of customer loyalty and satisfaction today, only 55 percent of customers feel respected by U.S. retailers, Forrester Research noted in its “Customer Experience Index 2021” report.
U.S. retailers’ average customer experience is only OK, the firm concluded, noting that the industry failed to improve significantly after two years of significant score increases, according to Fiona Swerdlow, a Forrester vice president and analyst and lead author of the report.
And that’s translating into sales. Among customers who feel happy with a company, 88 percent plan to stay with and advocate for it, and 86 percent plan to purchase more from it. Among customers disappointed with a company, conversely, only 25 percent say they would stay with it and only 28 percent plan to purchase more from it.
But not all of the news was bleak. Forrester found that companies overall rose to meet customer challenges that the pandemic presented, including the need to create digital experiences to engage customers apart from physical channels like brick-and-mortar stores.
While most companies’ CX wasn’t great, that’s not to say there weren’t a couple standouts among the pool of 220 companies, which included 39 of the largest U.S. multichannel and direct retailers.
Online pet supply retailer Chewy.com was the top brand for CX in its first year in the Forrester CX Index, but it still ranked just shy (0.6 points) of what Forrester would consider excellent.
Forrester cited Chewy.com for investing in order and fulfillment capabilities to meet the demand of its customer base, which grew 42.7 percent between 2020 and 2021. The company also introduced customer-pleasing services such as “Connect with a Vet” telehealth, pet meds, and online gift cards. And while some other firms struggled with the change, Chewy.com successfully transitioned its support staff from offices to a remote working environment.
Online crafts retailer Etsy ranked second and was the most improved company, though based on Forrester’s evaluation, it was just above average.
Also ranking in the top five, in order, were Trader Joe’s, Costco Wholesale, and HEB. Rounding out the top 10 were Publix, Walgreen’s, Ulta Beauty, Sephora, and HSN, respectively. Among retailers, Safeway finished lowest, just below Save-a-Lot, Dollar General, Rite Aid, and Newegg.
Forrester offered the following five recommendations for retailers to improve their CX performance:
Prioritize products and services. These are the foundational elements of retail CX. Yet in the Forrester report, customers had positive product and service experiences less than 65 percent of the time. Brands need to ensure that they are offering products and services that customers truly want, including high-quality products and services. Lower in importance are availability and delivery.
Respect customers. Many retailers fall short in this area, according to Forrester, with the notable exception being Chewy, which was found to respect customers 74 percent of the time. The lowest-scoring brand in this category, Dollar Tree, respected customers only 38 percent of the time.
Avoid customer annoyance, disappointment, and frustration. Any one of these can push the customer away.
Make sure customers feel appreciated and valued. Feeling appreciated, happy, and valued have the highest impact on customer loyalty.
Focus on the “three Es” in website design.
- Effectiveness:Websites need to focus on customer needs. Seventy-four percent of customers accessing a website via laptop or computer said they had a positive experience. The more effective companies can make the website (faster response rates, easy site navigation, etc.), the higher they will boost the positive response rate.
- Ease:Websites must be easy to access, navigate, and understand.
- Emotion: Websites tend to fall short in connecting with customers on an emotional level. However, website chat features and emails have performed well.
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