The Holistic Customer Experience
Out-of-stocks and poor customer service are among the top factors that can kill a shopping experience. However, these issues can be avoided simply by transitioning away from fragmented solutions and creating an integrated framework that gives the head office and stores insight into available merchandise.
When Chain Store Age’s senior editor Deena M. Amato-McCoy chatted with Graeme Cooksley, president and COO, Torex Retail, Dunstable, U.K., he described how an integrated framework keeps retailers abreast of product flow and helps associates stay up to date on merchandise knowledge—both of which foster a better shopping experience.
Chain Store Age: As retailers focus on the customer’s in-store experience, they want true end-to-end solutions that support customer satisfaction. What does the ideal configuration look like?
Graeme Cooksley: Since shoppers typically expect a high level of service, retailers should be creating a shopping environment that is conducive to helping the consumer make a purchase. This experience should extend before and after the consumer enters the store.
That means they need systems that will ensure that merchandise and product information is available and easy to locate, and pricing, incentives and offers should be clear. A synchronized supply chain should ensure that products are at the point of consumption when required. This is synchronized with replenishment. They also need to ensure that point of service is fast and efficient; there should be sufficient payment options, and customers should be rewarded for their loyalty. And of course, they need to have informed staff on hand to answer questions.
Customers will remember you not for what you sold them, but how you sold it. Satisfied customers will recommend others shop with you, but unhappy ones surely won’t make the same recommendation. Without these practices in place, retailers will fall short.
CSA: What are the top areas that customers relate to a poor experience?
Cooksley: The top issues include a poorly trained staff that lacks product knowledge, insufficient staff during peak trading periods and the inability to automate discounts, promotions and offers at the point of service. Meanwhile, there are some “behind-the-scenes” factors that contribute to an unsatisfactory experience, including a retailer’s insufficient visibility, accuracy and granularity of inventory information and, of course, insufficient ‘on-shelf’ stock availability.
The good news is that many can be easily fixed through an integrated systems framework.
CSA: How can a holistic framework of solutions lead to a more positive customer experience?
Cooksley: Retailers need to implement systems that keep them informed throughout the demand chain. Modern retailers are seeking real-time information systems to support this. And these solutions run the gamut.
For example, retailers should be using solutions that allow them to stay abreast of the flow of product throughout their supply chain and alert them to exceptions when they arise—and this cannot happen a week after reports have been printed. Meanwhile, accurate merchandise planning systems ensure that the right mix and quantity of inventory is where it needs to be to satisfy consumer demand.
It is also important to merge visual space-planning tools with analytics. Retailers can use consumer-demand data to influence store layouts and assortments that ensure that sales are maximized.
Behind-the-scenes, warehouse-management solutions help to satisfy the needs of retailers that operate across multiple channels. The solution ensures that the right merchandise is slotted and picked to satisfy brick-and-mortar stores, catalogs and Web sites.
CSA: As retailers start to re-focus efforts on systems integration, how can service-oriented architecture (SOA) help retailers achieve their goals?
Cooksley: SOA allows the retailer to implement complementary solutions faster. It provides the basis of application interoperability and information interchange without requiring the time and expense associated with interfacing the systems of the past.
CSA: This architecture also plays a role as retailers look to add new solutions. Mobile solutions seem to be gaining attention from retailers since they promise to improve the customer experience. What role do you think they will play?
Cooksley: These units are definitely opening up new opportunities. Most commonly, retailers use the technology for “queue busting,” as well as a plethora of in-store applications, including price checks, inventory counts or to deliver immediate business or product intelligence to their managers and sales assistants alike. As these applications prove, mobile solutions provide store-level associates the information they need to improve the store-level experience.
Mobile solutions are also changing customers’ perceptions of the service they receive. Customers can look forward to using mobile devices to check stock availability, reserve product as they shop the store, or as a payment device that could help speed them through the checkout.
OfficeMax 1Q sales fall on weak economy
NAPERVILLE, Ill. OfficeMax announced that for its first quarter ended March 29, total sales decreased 5.5% to $2.3 billion compared to the first quarter of 2007. Net income increased in the first quarter of 2008 to $63.3 million, or 81 cents per diluted share, from $58.5 million, or 76 cents per diluted share, in the first quarter of 2007.
OfficeMax Retail segment sales decreased 5.5% to $1.11 billion in the first quarter of 2008 compared to the first quarter of 2007, reflecting a same-store sales decrease of 8.7% partially offset by sales from new stores. Retail same-store sales for the first quarter of 2008 declined across all major product categories due to weaker U.S. consumer and small business spending and the negative impact of the Easter holiday occurring in the first quarter of 2008.
IKEA to open first U.S. manufacturing facility
DANVILLE, Va. IKEA, through its subsidiary Swedwood, announced that it will open its first U.S. furniture manufacturing facility on May 21 in Danville, Va. The 930,000 square-foot Swedwood factory will produce a variety of wood-based IKEA products, the company reported.
“We made excellent progress on construction last year and our installation of equipment and machinery has gone very smoothly,” said Bengt Danielsson, North American president of Swedwood. “Now our primary objective is to complete appropriate operational training for 175 coworkers as well as to ensure a seamless production and packaging process.”