Customer service as a part of the retail strategy

To be able to effectively use customer service as the unique proposition, a retail organization needs to create some principles of distinctive service:

1) Identify its key customers and listen and respond to them.
2) Define superior service and establish a service strategy.
3) Set standards and measure performance.
4) Select, train and empower employees to work for the customer
5) Recognize and reward accomplishment.

The first step towards creating a superior service organization is to correctly define the business that the organization is in. By defining its business too narrowly an organization may develop what is commonly termed as marketing myopia. For example if a pizza parlor views itself as being in the business of pizza alone, its view of the business is fairly restricted. However if it considers itself in the business of providing quick and reasonably priced meals to the consumer the element of service comes in and the view is enhanced.

Step 1:

Identifying the key customers and listen and respond to them

Just as a retailer cannot be everything to everybody the expectation of various classes of customers is bound to be different. The retailer needs to identify its customers and prioritize them. Once the organization has identified its key customers it is easy to understand their buying habits and occasions for purchase and then service them accordingly.

Needs, and hence expectations of customers change due to various factors. A change in the lifestyle of the consumer would result in a change in his needs and this would also translate into his expectations. The needs and wants of the youth are different from those of the middle aged and the elderly. Similarly as an individual moves up the income ladder, his needs would again change. The organization needs to track and be clear about the expectations of its customers in the present context. This is critical for the organization to be able to plan future business and pre-empt the competition.

Listening to customers helps the organization understand the moments of truth and the service experience that he has had. Customer’s hot line, comments and customer complaints, interactions with the sales etc are all methods by which a retail organization can listen to what customers have to say. Customers’ complaints or suggestions are a powerful tool for developing product improvements and new services to be introduced.

Step 2

Define Superior Service and establish a service strategy

A strategy crated needs to have goals specified and the method by which these goals can be spelled out. In order to provide superior service, the parameters of such service have to first be defined. These parameters have to be clearly defined and communicated to the persons within the organization.

An example of one such organization is McDonald’s where customer service is a part of the mission.

Step 3

Set Standards and measure performance

After having identified the key customers and their expectations and linking them to business objectives, arises the need for a system to capture analyze measure and track the performance of an organization on various parameters. For instance, Domino’s Pizza is passionate about its 30 minute delivery commitment. Useful, measurable standards can be expressed precisely.

International retailers like Nordstrom, LL Bean and Land’s End have clear satisfaction guarantees: If you do not like the product, they will take it back no questions asked.

Setting standards for performance not only ensures compliance with the targets but also helps improve credibility every time standards set are met and surpassed. This is the steeping stone to Customer Delight. At the same time the inability to meet targets helps identify gaps in service that can then be rectified.

Step 4

Select Train and Empower Employees to work for the customer

In order to be able to provide superior service, the retailer needs to create a workforce of employees who are dedicated and empowered to make decisions. Training needs to be on customer skills communication and product skills. Empowering employees to take decisions is a method of vesting a large amount of responsibility. Customers who typically return goods to a store or are dissatisfied with a product or service are bound to get more disillusioned if management authorization is needed for the action to be taken.

In the book, The Renewal Factor, Robert Waterman Jr refers to empowerment as the management’s method of encouraging faith in the principle: the person doing the job knows far better than anyone else, the best way of doing the job, and therefore is best to improve it.

Step 5

Recognize and Reward accomplishment

While money is an important factor for most individual’s recognition of the work done and praise can go a long way in motivating employees to put in their best. The retail organization needs to lay special emphasis on this, as in most cases, the face of the retail organization to the customer is the salesperson.

Rewards do not always have to be monetary they can be symbolic like holidays; lapel pins, special nametags, etc. In the retail environment it is necessary that the frontline staff is ambitious about providing a superior level of service to their customers.