Are Your
Customers Dissatisfied?
Try Checking Out Your Salespeople
Published: May 16, 2007 in
Knowledge@Wharton
The sales associate shifts
her gaze off to the side just as the customer
approaches. Suddenly she is intent on restocking
merchandise or discussing when she will take her next
break -- anything to avoid actual contact with a
shopper. It's the type of behavior that galls customers
and dominates the list of complaints cited in the second
annual Retail Customer Dissatisfaction Study conducted
by Wharton's Jay H. Baker Retail Initiative with the
Verde Group, a Canadian consulting firm.
The study found that
disinterested, ill-prepared and unwelcoming salespeople
lead to more lost business and bad word-of-mouth than
any other management challenge in retailing. "There are
a variety of different triggers for having a bad
shopping experience, including things like parking or
how well the store is organized. Some of those things
retailers can do something about and some of them they
can't. But frankly, a very important part of the retail
experience is the interaction with the sales associate,"
says Wharton marketing professor Stephen J. Hoch,
director of the Baker Initiative.
In a telephone survey of
1,000 shoppers who were asked about their most recent
retail experience, 33% reported they had been unable to
find a salesperson to help them. Many of these shoppers
were so annoyed by this one problem that they said they
would not return to the store. According to the Wharton
analysis, sales associates who are missing in action
cost American retailers six percent of their
customers.
Add to that the 25% of
consumers reporting they were ignored outright by sales
associates -- no greeting, no smile, not even eye
contact. This lack of engagement turned off three
percent of customers to the point where they said they
would permanently stay way from the store in which they
encountered this behavior.
Hoch remains puzzled by
sales associates who retreat from potential customers.
"You would think that if these sales associates are
spending the whole day interacting with people, they
would be a lot happier in their own life if they were
friendly. Instead, they pull into their shell. What's
wrong with saying, 'Hi, how are you doing?'"
According to Paula
Courtney, president of the Verde Group, survey
respondents were not frustrated by sales associates who
seemed overworked or outmanned by shoppers. It's the
"conscious ignoring" that irritates them, she says.
"Customers would walk into a store and the store
representative would see them and continue to put items
on the shelf or watch the cash register or do
administrative work -- absolutely ignoring the fact that
an actual person was in the store."
A Bad Experience
Counts More
The surveyed consumers
reported many other retail aggravations, including
trouble finding a parking space (33%) and product
stock-outs (22%) but shoppers are more forgiving of
those problems than they are of bad sales help. Being
ignored was the customer gripe most likely to be shared
with others through word-of-mouth, according to the
survey. Last year's Consumer Dissatisfaction Study
showed that one in three dissatisfied customers tells
others about a problem he or she encountered at a store,
and those people go on to tell an average of four
others. Half of all shoppers have chosen not to visit a
particular store because of someone else's bad
experiences.
"The importance of consumer
dissatisfaction, rather than satisfaction, is the fact
that a negative experience leads people to want to go
and talk it," says Hoch. They are less apt to talk about
it "when things go well," he notes, adding that despite
the grousing, many sales associates do greet customers
warmly and help consumers through the shopping
experience. Since they are on the front lines, these
employees become the most visible target for complaints
when there is a problem. "When something goes wrong, the
sales associate gets blamed for it -- fairly or
unfairly."
The survey revealed
differences in dissatisfaction by age, with older
shoppers reporting fewer problems. The average number of
problems experienced per consumer is highest among those
18 to 29 years old. Shoppers under 30 were more likely
to be ignored by store staff or turned off by "phony"
salespeople they perceive to be more interested in
making a sale than actually helping the customer. They
also complain more frequently than older shoppers about
not finding items due to disorganized stores and
employees' lack of product knowledge.
Hoch says he is not certain
why younger people are more likely to find sales people
lacking in authenticity, but he thinks it might be that
sales people are often trained to monitor younger
shoppers more carefully to watch for theft. "Overall,
older people are less dissatisfied than younger people.
I don't know if it's because they are less patient or
have higher expectations, or older people are just worn
down and don't expect as much."
Courtney suggests that
younger people typically have less loyalty to stores and
are highly demanding consumers. They are also among the
most valuable consumers to retailers and other brand
marketers attempting to build life-long relationships
with customers who are just entering their high-spending
years as they form families and buy homes. "Young people
tend to be exposed to more choices," she says. "They
recognize that everyone wants a piece of their business.
They are used to being catered to; perhaps that makes
them more demanding."
Respondents also reported
varying degrees of dissatisfaction depending on the type
of retail store they had visited. Stores specializing in
a particular type of merchandise, such as electronics,
home improvement or office supplies, so-called "category
killers," account for the largest proportion of shopping
trips and drew the most complaints and lowest shopper
loyalty.
Hoch notes that these
stores often carry vast numbers of products that can be
relatively expensive and require more technical sales
knowledge than other types of merchandise. "My thinking
is that when people are buying a more expensive item
carried by these category killers, they have less
experience with them and they need some help."
Mass merchandisers -- like
Target -- generate the highest level of loyalty both in
terms of repeat patronage and the likelihood of
consumers recommending a store to others, although
survey respondents did report some problems with a lack
of staff at these stores as well. Department stores
ranked second in customer loyalty although some
consumers reported difficulty finding items because of
cluttered stores.
Overall, Hoch says, the
rise of category killers dominating certain merchandise
segments has changed the nature of retailing, eroding
the level of professionalism that had been an important
element of the industry in prior generations. "In the
old days, you could walk into a hardware store and find
a little old man who had been there for 25 years and
knew exactly where to find anything," says Hoch. "Now
think about trying to know where everything is inside a
large do-it-yourself store that's humongous. It's
impossible to expect someone would know where everything
is." Similarly, it is difficult for sales people in
electronics stores, where technology is changing
rapidly, to know the answer to every question a customer
has about a certain product.
The Ideal Sales
Associate
The survey results led the
researchers to classify four different characteristics
that would be found in ideal sales
associates.
The most important is being
an "engager." Associates fitting this description smile
and interrupt whatever they are doing to help a shopper.
"Problems associated with not finding an 'engager' are
most prevalent overall, and across all store types,"
according to the survey. The second-most important type
of sales person is the "educator." This employee is able
to explain products, make recommendations and tell
customers where products can be found. Hoch describes
what it takes to be an educator: "Does the sales person
help you find what you need, inform you and educate you?
Or is it like staring into a black hole when you ask a
question and the sales person looks like a deer caught
in the headlights?"
Hoch notes that the
importance of educators depends on the retail format,
with category killers most dependent on this
characteristic in their sales staffs.
Another type of ideal sales
associate is the "expeditor." This employee is sensitive
to customers' time and helps speed them through long
check-out lines. "You see this one at the airport or
other locations where there is some clog-up in the
system," explains Hoch. "This sales person recognizes
that, with their intervention, things can keep moving
forward .... Someone has to notice the problem and go
out of their way to alleviate it."
Finally, the research
indicates that customers want "authentic" sales help.
These associates let customers browse on their own, and
appear genuinely interested in helping regardless of
whether a sale is made or not. "No one wants to be
ignored," says Courtney, "but there is a balance between
the right level of engagement and a sense of
genuineness."
The survey results come as
little surprise at Federated Department Stores, the
parent company of Macy's, according to Jim Sluzewski,
the company's vice president for corporate
communications. "This survey demonstrates what a complex
subject customer service is. Customers have different
expectations that are not necessarily driven by
demographics, but by psychographics or lifestyle," he
says. "There are some individuals who want a great deal
of service from a store, and others who are irritated if
they are talked to too much. Finding the right balance
is something that we're always working to
achieve."
Hiring more workers is not
necessarily the answer to complaints about retail staff,
Courtney notes, adding that building a level of
sensitivity to what shoppers want is more important. For
example, prompting a sales person to simply open a
second register when a long line begins to form gets
more to the root of the problem. "This is what trumps
getting more bodies -- getting more staff to show
behaviors that are sensitive to consumers' needs."
Indeed, Federated recently
reduced the number of customer service stations tucked
away throughout the selling areas of its stores in order
to consolidate customer service in fewer, but more
visible check-out areas adjacent to store
aisles.
According to Hoch, the
reality of the competitive pressures in the retail
industry probably would not permit stores to change
associates' behavior by offering big bonuses or higher
pay as a way to find people who are naturally good
"engagers" or "educators."
Technology, however, may
provide some solutions. Hoch suggests sales associates
in large home improvement stores could be outfitted with
hand-held devices listing products and the aisles where
they could be found. When a customer pulls an associate
aside to ask about an item, the employee could simply
punch it up on the hand-held. Retailers, Courtney adds,
could do more with signage to direct customers to
merchandise, and category killers in particular could
make better use of information kiosks to shift some of
the educators' work onto consumers
themselves.
Federated is introducing
hand-held devices, like those used by car-rental return
employees, to reduce long check-out lines. When
customers clog a register at one time, associates can
move down the line using the device to rapidly scan
merchandise and record credit card sales.
All four traits necessary
in good sales associates are possible to develop in any
employee as long as they get the right instruction and
are monitored on the retail floor,Courtney says. "The
good news is that all of this is trainable."
