ACE HARDWARE RANKS #1 IN CUSTOMER SATISFACTION FOR THE 10th YEAR IN A ROW

The J.D. Power 2016 Home Improvement Retailer Satisfaction Survey awarded Ace Hardware top ranking for their 10^th straight year. The study surveys 2,995 customers who purchased home improvement-related products from a home improvement retailer in the last 12 months, and was conducted in January and February 2016.

On a 1,000 point scale, Ace Hardware scored 810 in overall customer satisfaction, followed by Menard’s with a score of 803. Lowe’s placed 3^rd at 799. The overall average across retailers was 795, up from 788 a year ago. The Home Depot was just at the average with 794. The study found that average drops significantly when an initial greeting in the store takes longer than 2 minutes. Customers also want the retailer to provide advice, and be able to answer their questions effectively in the store. "The retailer's staff is most critical to differentiating the experience provided to customers, especially when it comes to the timeliness of greeting customers, answering their questions or providing advice," said Greg Truex, senior director of the at-home practice at J.D. Power. "Retailers that train their employees to engage with customers proactively and assist them are more likely to provide them with a satisfying experience during these moments of truth."

Ace scored 855 in staff and service compared to 811 average.

According to the Home Improvement Research Institute, home improvement consumer spend is on the rise, with an expected 4% increase this year to $332 billion.

Source: Chain Store Age, JD Power.com 

HOME DEPOT IT INVESTMENTS IN OMNI CHANNEL FOCUSES ON CUSTOMER EXPERIENCE

The Home Depot discussed this week its IT investment and strategy that focuses on the customer buying experience. The company’s Common Order Management system, or COM, is the largest IT project in the history of The Home Depot.

COM is an inventory visibility platform that looks at millions of deliveries through small and large delivery trucks, direct fulfillment to DCs and in-store pick up transactions. COM will help identify the best fulfillment option for a customer, while allowing Home Depot to leverage its omni-channel options.

The focus on this area is based on the fact that 1) the retailer’s fastest growing ecommerce channel is buy-online, pick up in sore, 2) the average ticket for ecommerce transactions are considerably higher than physical in store transactions and 3) ecommerce chat and email are growing  in product information exchange.

“The IT investments we are making are really to optimize the whole supply chain offering,” said Home Depot Senior VP and President-online, Kevin Hofmann.

Source: Chain Store Age

Analyzing Retailer POS Return Data Critical for Customer Satisfaction in Omnichannel Age

Retailers are striving to minimize return rates and maximize customer satisfaction. In a recent survey from Voxware, it was revealed that 57% of consumers are returning items they purchased online. 42% noted the products they received were in the wrong size or color and 15% said they received the wrong product altogether. Nearly 20% of consumers say they received an incorrect item a second time.

By analyzing return data, retailers can gain a better understanding of consumer preferences and behavior, as well as survey their internal supply chain and warehousing abilities.

Retailers are focusing heavily on omnichannel. Customers expect to buy what they want, how they want, when they want and have it delivered quickly to wherever they want them. Consumers can order online and pick up in a store, order from a brick and mortar store and have it shipped to them or the store, and order directly online. This requires store operations to effectively manage picking and shipping, turning each store into a warehouse.

Retailers need to analyze their business processes though POS and return data to drive sell-through velocity, margin improvements and customer loyalty.

While customers may be willing to forgive retailers after one return experience, 45% of respondents stated that they have limited their shopping with the retailer – both online and in-store after a second return.

Resources: Retail Touchpoints, Multichannel Merchant

Customer Less Satisfied In Q3

December 9, 2014

The national level of customer satisfaction fell 0.7% in the third quarter of 2014 to 75.6 on a 100 point scale, according to the American Customer Satisfaction Index (ACSI), pointing to weak spending growth for the fourth quarter.  This is the third consecutive quarterly decline in customer satisfaction for the country as a whole, which is at its lowest level since early 2011.

While most predictions for the Thanksgiving period projected strong growth, retail sales actually fell relative to the previous year.  The suggestion that weak income growth is to blame is inconsistent with the data.  Income growth has indeed been weak, but not worse than it was in 2013.  In fact, American households are marginally better off now.  Unemployment is down, and a major factor boosting consumers' ability to buy, gas price, is at its lowest level in years, much lower than it was in 2013.

Based on income, gas price, and even consumer confidence, ACSI says an increase in consumer spending would be expected, but not if customer satisfaction is used as a predictor.  There are two major factors that determine spending: expected satisfaction and ability to spend.  The latter has improved somewhat, but the former has gotten worse, and continues to deteriorate.  Accordingly, the ACSI prediction for the fourth quarter is weak spending growth of 1.8 to 2%, a pace behind the overall pace of the economy.

"The US economy needs more consumer demand to shake off these seemingly persistent doldrums," said Claes Fornell, ACSI chairman and founder.  "Low interest rates, some inflation and wage growth would all help, but consumers also need a reason to buy.  Their satisfaction matters not only to them as individuals, but for the economy as a whole."

Source: Retailing Today

Target.com falls just shy of 'superior' on customer satisfaction list

Though 79 is just one point shy of what ForeSee considers a superior score on its annual top 100 online retailers for customer satisfaction list, Target should still be concerned, as it was three points behind rival Walmart, and three points does make a difference.  With the lowest score on the list being 69 and the highest being 89, achieved by Amazon.com, most retailers on the list had a score in the 70s, while 36 on the list earned the distinction of scoring 80 or higher. The scores are based on a 100-point scale.

“We’re measuring the biggest players in the game, and they just keep getting better and better. Because customer satisfaction, as we measure it, is predictive, that’s a good sign not only for the consumer experience, but for the bottom line of internet retailers as well,” said study author Larry Freed, president and CEO of ForeSee. “If there’s a negative spin to these positive trends, it is that this puts even more pressure on all other e-retailers to keep up or catch up.”

Target.com's score of 79 was one-point better than what it achieved in 2011. Though small, the increase is significant considering how much flack Target got over the issues surrounding the launch of its Missoni line. Last fall, the retailer failed to anticipate demand for the product, and many online orders ended up delayed or canceled.

Meanwhile, Walmart.com's score jumped from 79 to 82, showing that the company's investments in online and social media are paying off.

However, no online retailer seems to come close to Amazon.com, which climbed three points to 89 to top the list, and is four points higher than the second highest scoring websites, Apple.com (85) and QVC.com (85).

“Amazon continues to set the standard for e-retailers. The truth is that every consumer who has visited Amazon knowingly or unknowingly benchmarks all other experiences against it, and why wouldn’t they? They do everything and they do it well,” said Freed.

Measuring customer satisfication is subjective, so to achieve its list, ForeSee uses individual satisfaction scores for the top 100 e-retailers by revenue as measured by Internet Retailer, quantifies the likely future behaviors of website visitors, including their likelihood to purchase online or offline and proxies for loyalty such as likelihood to return to the site or recommend. When compared to dissatisfied customers, highly satisfied website visitors—those who score their experience 80 or higher—report being 72% more likely to purchase from that retailer’s website and 56% more likely to make the purchase through another channel.

“Highly satisfied website visitors are nearly 70% more likely to recommend the website to others than dissatisfied customers. In the modern world of Facebook, Twitter, and other social media, it is even more imperative to provide the best experience possible to your customers because any experience has huge potential to be amplified, for better or for worse,” said Freed.

Source:  retailingtoday.com