The American Customer Satisfaction Index (ACSI) numbers released last week included greatly improved ratings for American automakers. Some pundits concluded that this indicates that American car companies have already made an historical comeback.
Personally, I think these numbers are a result of a radically smaller diehard customer base and previous nowhere-to-go-but-up ratings. It would be a stretch to believe that owners of Ford, GM, and Chrysler vehicles who have watched both resale value and dealership repair facilities disappear in the past year have suddenly forgiven and forgotten all the sins that led the big three to the steps of Capitol Hill to beg for a big bailout.
But the fall of American automakers has provided a fantastic cautionary case study for all businesses, particularly those in the retail industry. It is a tale of unmet customer expectations, which led to chronic dissatisfaction, which eroded trust, which destroyed relationships, which paved the road to bankruptcy court. Those that regard customer satisfaction as a subordinate concern now have a graphic illustration that bankruptcy court hath no fury like American consumers scorned.
The U.S. retail industry is unwittingly helping to write a new customer satisfaction case study now, which is sponsored by the global recession. We all have a rare opportunity to discover how important customer satisfaction is to an industry when it doesn’t seem to have enough customers to go around.
The airline industry involuntarily participated in a similar customer satisfaction case study less than a decade ago. Immediately following 9/11, airlines abandoned their quest for delivering an excellent customer experience and replaced it with security measures which were time-consuming, inconvenient, and sometimes even intrusive. Passengers didn’t complain because it seemed like a necessary tradeoff at the time. But the “security” excuse got old, and when major airlines found themselves sitting in bankruptcy court not too long after 9/11, what we all learned was that you can only hide behind excuses for so long.
Recession is the new 9/11 excuse for abandoning customer service. When the recession hit the retail industry hard, the customer experience immediately became secondary to the focus on store closings, job cuts and operational efficiencies. The retail industry went into survival mode, and there was a clear understanding on both sides of the cash register that just staying open for business was enough to meet customer expectations.
In all fairness, there are some retail chains that refused to lower their customer service standards for any reason. Neiman Marcus is one of those chains. CEO Karen Katz has stated repeatedly that the Neiman Marcus branded customer experience would not be compromised, recession or no recession. The luxury chain has held onto that uncompromising commitment to quality even when quarterly profits have declined as much as 84%.
Another retail chain that didn’t seem to compromise its customer experience throughout the recession is one that has probably never shared a single customer with Neiman Marcus. That chain is Waffle House, the itty bitty black and yellow diner boxes that sit at the end of the exit ramps of America’s interstate highways.
Whenever you walk into a Waffle House restaurant, you can expect to be welcomed not by one token employee whose job title says “greeter,” but by several employees, no matter what their job description is. Before you leave the front door again, you can expect that you will have been asked how you liked your food by at least one employee who didn’t contribute at all to your meal, but who seems to genuinely care about your answer anyway. In between the entry and exit touchpoints you’ll get a Waffle House branded experience which is decidedly humble, but, in my experience, consistent and sincere.
Its fluorescent lighting, formica table tops, and linoleum floors will never win Waffle House any restaurant interior design or dining ambience awards. But in a Zagat survey of 103 restaurant chains recently, diners’ ratings made Waffle House #5 for both its breakfast and its coffee. Personally, I rank it #1 in its category for the consistency of its customer experience.
Great service doesn’t necessarily mean extravagant service like Neiman Marcus delivers. A no-frills customer experience like Waffle House delivers can be equally impressive when customers know it’s sincere and dependable. With that in mind, blaming the recession for delivering a diminished retail experience is really not a valid excuse any more. It never really was a valid excuse, but customers were willing to play along for a while.
Retailers can count themselves lucky that consumers have been patient with standing in longer lines at the cash registers after recessionary cutbacks. Customers have generally been understanding about lean inventories that haven’t included enough shoes and clothes in their size. They’ve forgiven smaller portions at restaurants, shorter store hours at malls, and retail employees who are a little too eager to make a sale.
In return for that consumer compassion, retailers should be willing to give anyone who walks in their doors a generous amount of friendliness, care, and sincere gratitude for their presence, whether they spend a lot, a little, or nothing at all. Anything less is really not excusable, and won’t be tolerated much longer, now that it is perceived that the worst of the recession is behind us. Whether the recession is, in fact, actually behind us really doesn’t matter. When it comes to customers, perception is reality.
Customers are expecting their shopping experience to return to “normal” at some point, so retailers should already be working to achieve a new balance that will meet customer expectations for elevated service levels while still maintaining efficiencies that create profits. Our friends in Detroit have shown us that by the time customer satisfaction shows up on a spreadsheet, it may already be too late.
A return to a customer service focus was inevitable, so it really shouldn’t catch any retailers by surprise. Experienced retailers know that a neglected customer experience can only hide behind the recession for so long. For those retailers that get busy and forget about that, there’s no worry. Customers are always happy to remind you that they are the center of your universe.
Comments
What is being said here is so true, yet the majority of retailers will not pay attention to the warning. As a Store Planner, I did Pro Bono work during the 911 disaster period in New York City.
The truth of the matter was that at “Ground Zero” retailers were devastated by the physical damage, by the loss of pedestrian traffic in the area and the loss of confidence by the consumer.
This recession, as history will write, will show that certain retailers did not mind the shop in good times and could not adjust to the new dynamics of retail that the recession brought on.
Retailing is a complex business that has many factors that determine the success or failure of the business. As the article mentions customer service is the bridge between the retailers philosophy of how much or little they are willing to do for the customer. Why should this be any different today than it was two years ago?
There is an old saying that a chain is as strong as it weakest link. If the retailers chain made up of customer service, product, store design, lighting, cleanliness, merchandising, price, quality, assortment, inventory levels, return policy, legitimate sales, graphic presentation, and consistency of providing all of the above
Another striking example of bad customer service which led to bankruptcy is Circuit City. It was selling the same stuff as Best Buy does. Store locations were as good as Best Buy. Executives pay was similar. But when one would enter a Circuit City store, one would immediately notice the lack of professionalism, of education, of politeness, of availability and of skills of its sales team.
There is no secret. Beautiful illustrations are everywhere (the Apple store experience to name one).