As part of the 2015 “Retail Propositions Index”, 40,000 shoppers around the globe, including 10,000 in the UK, were asked to rate retailers on measures including price, range and value for money.
Lush joined the UK’s top three retailers after the British public awarded the brand the highest ratings for customer service, store look, and product quality. In the overall rankings, Amazon and John Lewis remained in first and second place for the fifth year running.
However, despite ongoing supermarket wars over price and convenience, the findings expose a direct correlation between customer service and growth. Retailers which scored in the top 25 per cent for service also saw on average ten per cent annual revenue growth over the last five years.
According to Matt Coode, partner at OC&C Strategy Consultants, the report is proof that customer service should be high up on the retail CEO’s agenda.
“Our research shows that customers’ judgement of service boils down to five key areas which, in order of importance, are: ease of shop (be it in store, online or on mobile); speed of checkout; personal and expert advice; slick post-sales support; and consistent and seamless service on and offline,” he said. “It goes to show there is no single formula to winning in service, as exemplified by the differences between two of the best in breed: Amazon with its relentless obsession with efficiency and simplicity, and Lush with its emphasis on staff being attentive and giving useful advice to make customers feel pampered and special.”
But while the best British retailers are delivering great customer service, in general, the UK is falling behind its US counterparts. Some 46 per cent of US consumers are delighted by the level of service they received, compared to 32 per cent of UK shoppers.
When looking specifically at customer service ratings, eight of the top ten retailers come from the US. By comparison, just two British retailers, Lush and John Lewis, made the cut.
Coode said: “There are a number of things UK retailers can do to close the gap on international competition. Firstly, bosses must decide which elements of service they need to be great at and invest accordingly. Secondly, don’t assume that a focus on value is an excuse get complacent about service. Thirdly, use technology to enhance rather than replace the human touch. And finally, think of people as capital, not cost – investing in, motivating and training colleagues to deliver great service will not only enhance retention, but also deliver valuable competitive advantage in the long run.
“As a company with a targeted and simple approach to service, US grocer Trader Joe’s is a particularly good example of these tactics in action. Employees are trained to be friendly and helpful so that, despite its reputation for affordability, Trader Joe’s excels in the service stakes. The company is proof that value for money means more than simply being good on price, and consumers increasingly refuse to sacrifice one for the other.”
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