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IRUK Top500 The Customer Report: 2018

IRUK Top500 The Customer Report: 2018

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12 approaches that work (CR15)

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How do leading companies create innovative retail experiences and improve service levels? Chloe Rigby highlights examples of best practice crafted around putting the customer first

1. Help the customer to showroom

It’s because shoppers like to see for themselves just what it is they are buying that stores are often a first port of call. Many who visit a shop will be armed with a smartphone that can be used to ‘showroom’ – checking prices or product reviews online. Retailers may have been concerned about the impact of such behaviour on in-store purchases in the past, but today companies are learning that a better-informed customer is one who is more likely to make a purchasing decision in the store, rather than when they’re at home in front of their digital device of choice.

When, in 2011, John Lewis became the first UK department store to offer free wi-fi, it pointed to internal statistics that showed more than 60% of its customers researched online before visiting a shop to buy. Introducing the service to its stores, it said, would put that information at customers’ fingertips.

Today, as seen in the case study on page 18, Burberry is using its in-store wi-fi to enable shoppers to make themselves known to staff, who can access information about customers’ preferences to offer better face-to-face service.

2. Understand the customer better

Using analytics to win new insights into the customer can have significant effects on sales. By finding how shoppers behave online, retailers are better placed to provide them with both resources and functionality that will be useful in the course of their purchases.

Upmarket fashion retailer Burberry has invested in customer data and analytics in order to understand what the luxury customer wants. “The insights gained,” it said in its financial results for the year to 31 March 2015, “enabled our global teams to make more informed decisions in retail, customer service, digital and marketing, all driving productivity and efficiency improvements throughout the business.”

For a global company such as Burberry, this is no small challenge. As well as working out what customers want in its home UK market, it is also working to engage with shoppers as far afield as China, both in customers’ home territories and as they travel throughout the world. That’s necessary for Burberry since about half of transactions in its shops in Europe, the Middle East, India and Africa, were made, in the year to March, to travelling luxury customers. Understanding what makes a holidaymaker want to splash out is therefore important to the business.

3. Prioritise customer service

The way customer service is delivered varies enormously between retailers. But while one

retailer may need round-the-clock cover, another may find that what matters is not necessarily the number of operatives available at any one time, but the commitment to giving service that works for the customer.

Marks & Spencer wins its Elite retailer ranking in the Brand and Engagement Dimension of the IRUK 500 for a level of customer care that includes contact centres in the UK and India serving customers around the clock. M&S.com director David Walmsley is clear that “the days of retailers working retail store hours are long gone”. He adds: “Things can happen at any time of the day or night and we have to be there for them”.

In this Customer Dimension, however, Majestic Wine is ranked as a Leading retailer for a service that’s given by three full-time customer service staff, alongside a social media manager, while weekend cover is staffed by members of the digital department. Richard Weaver, ecommerce director at Majestic, says the approach, which sees him answering email and social media customer enquiries one weekend in nine, “keeps everyone grounded”.

But whatever level of customer help retailers offer, what matters is being able to help, suggests Weaver: “The most important thing is that people need to be empowered.”

4. Be where customers are, whether that’s online…

Many internet shoppers spend far more time on social media than they do buying online. Rather than trying to interest shoppers via the safe environs of a home website, or through social media messaging and marketing emails, smart brands go where customers are to develop a different kind of relationship.

This spring, Boots struck a cross-channel partnership with forum Netmums aimed at raising awareness of the Boots Parenting Club, while also keeping parents informed about health issues. Running across online, social, mobile and in the store, it includes a Boots branded tab on the Netmums site, weekly editorial promotions and user product trials. The parenting forum has 1.8m registered members while some 9m people visit it each month. This makes it a useful way to reach an important demographic for the health and beauty retailer.

Rimi Atwal, managing director of Netmums, says the partnership is a win-win because it brings together two trusted names in parenting. “It offers genuine integration, native solutions and the high-quality content Netmums is renowned for across all platforms, making both business sense and parents’ lives easier,” she said, at the time the deal was announced.

5. …in another retailer’s store…

By venturing beyond the traditional confines of home stores, retailers are starting to arrive in some very interesting places where they can do things differently. Some companies are moving beyond the virtual to the real-world shop floor, while other companies are looking anew at concessions.

Pureplay Missguided recently opened concessions in Nordstrom stores in the US and in Selfridges’ Trafford Centre, Manchester store. Founder and managing director Nitim Passi said at the time that the move was all about testing new approaches with the customer. “Our focus now,” he said, “is all about experimentation with the brand, trying new and innovative ways to engage a wider market, and allowing consumers new and diverse ways to shop and engage with Missguided.”

Argos already had its own shops when it decided to open in branches of Sainsbury’s. Its first small-format digital stores are now open, and 10 more are expected to open so by the end of this year. Roger Burnley, retail and operations director with Sainsbury’s, says the move offers its customers better choice while also improving the shopping experience; while Steve Carson, director of retail and customer operations at Argos, speaking at the time the first stores opened, said the partnership would “help us to bring the convenience of the Argos offer to more customers”.

6. …or on the move

Retailers are moving still further beyond both the shop and the online site in efforts to give customers the best service possible. It’s an approach that recognises that most shoppers spend a significant proportion of their day on the move – and like to fit their retail transactions in around their lives, rather than the other way round. A propensity to browse online from a smartphone on the commute, or place an order from the tablet computer in front of the television is well-mapped by retailers’ understanding of their customers’ behaviour.

Traders are responding by designing services that work in and around often busy days. John Lewis, for example, has a click-and-commute shop at London St Pancras where office workers can collect goods they previously ordered online before stepping onto the 6.30pm to Sheffield, Nottingham – or Paris. Argos’ Cannon Street Tube station digital format store is convenient for those travelling around the capital to place or collect orders, while House of Fraser operates ordering and collection point outlets both at its own HouseofFraser.com stores and, in Cambridge, through a branch of Caffè Nero.

7. Empower customers

Giving customers the chance to choose their own benefits is a sure-fire route to personalisation.

Rather than learning from shoppers’ data which products customers might like to have offers on, the retailer can instead ask them – or empower them to set their own.

That’s what supermarket Waitrose did when it gave customers the chance to choose their own grocery discounts in June this year with its new Pick Your Own Offers scheme, a service it believes to be a world-first. Members of the myWaitrose loyalty scheme can log into the Waitrose.com site to choose which 10 from a list of almost 1,000 items they’d most like to have a 20% discount on. That discount is then applied automatically whenever they buy those items in-store and swipe their card, or online, having signed into their online account.

Speaking as he announced the service, Mark Price, managing director of Waitrose, said this was a “ground-breaking” move. “Different forms of personalised marketing have been around since the 1990s, but we’re introducing mass customisation in grocery. Customers can choose what’s valuable to them when they shop for groceries. We really are giving power to the consumer.”

8. Make loyalty easier

Of late, retailers have searched for ways to fully stretch loyalty schemes across channels, including mobile and the store as well as online. By doing so, retailers hope to encourage shoppers to use loyalty schemes more flexibly than the traditional card. While customers accrue points, the retailer gets data that gives valuable insights into shopping behaviour and can also personalise the service it offers the customer.

House of Fraser recently came up with its own answer when it launched a new iOS retail loyalty app. The app rewards users with points when they engage with the brand in-store, online and on the app. Those points can be spent through a variety of channels. When the app was launched, Andy Harding, House of Fraser chief customer officer, said the integration of its Recognition loyalty programme gave it a market-leading proposition.

Oyvind Henriksen, co-founder and chief executive of Poq Studio, which developed the app, said: “Every retailer that has a loyalty scheme should pay attention to what House of Fraser is doing in this space. Why would you force your customers to use a physical loyalty card when you can deliver it right to their most intimate device?”

9. Remove distractions, speed up performance

Designers aiming for simplicity are removing the distractions that may be slowing websites down, whether those are larger pictures, tags or extra content. Many have done this in order to increase the speed at which websites load on mobile, and have discovered that the desktop experience improves as a result.

Schuh, for example, decided to develop a responsive website because it wanted to give customers a good experience whatever device they used to visit the site.

It decided to use mobile design as its baseline simply because it’s harder to put a desktop site on a mobile device than vice versa.

“A lot of the content we’ve had [in the past] has been because we’ve had the pixels to fill so we add something in,” Stuart McMillan, Schuh’s deputy head of ecommerce, told Internet Retailing Expo 2015.

Since it was installed, the cleaner look of the site has resulted in rising visitor numbers from both desktop computers and from mobile devices. The company also scored an index value of 299 out of a possible 300 in the IRUK 500 research into The Customer, reflecting exemplary site speed as well as customer service.

10. Meet and preempt customers’ buying needs

Retailers that make it easy for shoppers to buy even when they’re busy and on the move are simply more likely to sell to customers again and again.

Domino’s Pizza, for example, has developed an enormous audience among customers who would rather order online – and preferably through their mobile devices. The pizza delivery company has iPhone, iPad and Android apps, enabling shoppers to buy quickly and easily. In the year to 28 December 2014 some 69.4% of its total delivered orders were placed online, of which 44.2% came via a mobile device.

Mothercare’s mobile app is designed with the needs of its target audience, “busy mums and mums-to-be”, in mind. Its ecommerce function is complemented by a range of parent-friendly features including to-do lists, a baby name finder, baby tunes, a week-by-week guide to child development and a range of useful timers.

Catering to the customer’s needs in this way has paid off at the bottom line. In the year to 28 March 2015, Mothercare reported a slight dip in overall sales, which, at £458.1m were 0.9% down on the previous year. But mobile sales bucked the trend, coming in 82% ahead of last time. That helped overall online sales rise by 18% to £138.4m, some 30% of total UK sales.

11. Help shoppers check it’s right for them

One drawback of buying online is that it’s hard for shoppers to be certain they have the right item. Today, a range of features exists to reassure customers. From reviews and ratings where browsers can check what ‘people like me’ thought of an item, to virtual wardrobes that help customers make sure they have the right size of clothing, to product videos and YouTube ‘how to’ guides, all exist to help bridge the barrier between the physical thing and the online website.

Asos, for example, brings together on website pictures posted from Facebook, Instagram and from the shopper’s own device under #asseenonme – featuring customers showing what an item bought from the fashion retailer looks like when worn by another shopper rather than a professional model.

Meanwhile, Halfords has an online fast finder that enables drivers to put in their registration number to be guided towards the right bulbs, blades, batteries and oil for their vehicle.

12. Enable customers to… customise

When shoppers can put their own stamp on an item, they can be more sure it’s right for them. From business cards to cars, goods of all sizes and types can now be personalised across sales channels, during or after the buying process.

For example, shoppers can customise Nike sports shoes, choosing different widths, different colours and graphics, in order to make sure the shoes are exactly what is wanted. Items can be returned, but it seems likely fewer will be. Last year, Hyundai opened what it billed as the UK’s first digital-first car showroom. It’s in the Bluewater Shopping Centre where customers can browse screens to choose the options that work for them, from colour, transmission, fuel type to financing options.

At the time, Tony Whitehorn, president and chief executive of Hyundai Motor UK, said: “Traditional car dealerships will always have a vital role to play in the car buying and ownership experience.

“However, this online and in-store option gives customers another choice to fit around their busy lives.”
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Featured In
IRUK 500 The Customer Report 2015

IRUK 500 The Customer Report 2015

Featured In
IRUK 500 The Customer Report 2015

IRUK 500 The Customer Report 2015

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