Customer Service: The Key Differentiator in Retailing - Paper Example

7 pages
1779 words
University of Richmond
Type of paper: 
Research paper
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Customer service is vital in the successful running of retail businesses. Retail business is noted to run the American economy on a broad scale. Therefore, with the customers regarded as the king in this line of business, it is paramount that the employers can adequately train their employee to have a proper interaction with the customers. Furthermore, for a retail business to gauge on their success rate in the industry, there is need to have customer feedback generated by the firm (Soderlund, & Colliander, 2015). This paper will address the customer service, training, retail customer service strategies as well as benchmarking customer service. It will further capture the retail customer service model, focusing on leadership and enablers in customer service industry. With the feedback created by the clients, it is then easier for the company to act on areas that they need to improve on and ensure there are no customers who are lost to the competitors. Competitors in the industry are not considered as an enemy in the retail business but are checkpoints on how best a business can operate in a competitive market.

Customer Service - the Key Differentiator in Retailing

Literature Review

Focusing on the customer experiences and adequately understanding their needs has solved chronic problems for the retailers. Retail in the U.S. comprises of 45% of the economy. Retail industry is also the largest employer in the U.S. (Soderlund, & Colliander, 2015). The customer is regarded as the king. Therefore, for a business to succeed it is paramount that the retailers have a tremendous understanding and respect for the customers. The customers in todays competitive markets have more money to spend and a wide a variety of items to choose from. Thus, for the retailers to satisfy the customers, they need to be able to listen to their feedback and continually improve the services and goods.

All businesses that sell their products and services to the customers are referred to as retail. Research has proved that over the past couple of decades, there have been changes in the general retail business (Bienstock, Mentzer & Kahn, 2015). For example, what was once strictly a made-to-order market for the clothing industry has transformed into a ready-to-wear market. In some sections of the world, the retail business is notably dominated by smaller family-run firms, but with the rise in competition, the retail market is increasingly being taken over by billion-dollar conglomerates like Sears, Carrefour, and Walmart. The reason for the takeover is that the larger retailers have the ability to fund heavy supply/distribution chains, control extensive inventory management systems, broad scale marketing plans and have financing pacts.

Customer fulfilment depends on the products perceived performance or the values attached to them about the customers expectations (Saeidi et al 2015). If the product or provision is not up to the customary, the client is dissatisfied, but when the product exceeds the customers expectations, they are highly satisfied and happy. One of the biggest mistakes is that most companies do not pay much attention to the customers satisfaction. The capability to satisfy the customers needs is one of the definite competitive advantages. When the customers are satisfied, they tend to be loyal, willing to pay more and also good external marketers. Therefore, customer satisfaction should be regarded as an asset and ought to be monitored just like any other physical asset (Bienstock, Mentzer, & Kahn, 2015). The main goal of this research paper is to illustrate the prominence of customer satisfaction in the retail industry. The retail industry is known as a highly competitive field and the capability to meet the clients expectations and demands has become one of the most essential elements so as to have a sustainable growth and a profit margin.

Customer service - The Key Differentiator in Retailing

Researchers have approved certain reasons as to why retailers ought to strive for a long-term relationship with their clients (Blut, Frennea, Mittal & Mothersbaugh, 2015). Majorly, four reasons have been approved. To begin with, loyal customers have a tendency to spend more on the retailer's shops, and it costs significantly less to serve the as they are well conversant with the shop routine. Second, the cost of acquiring new customers is approximately 10-15 times more as opposed to the costs to satisfy and retain the current clients. Third, satisfied customers have a tendency to recommend the shop products and services and are more likely to pay premium prices to suppliers they know and also trust. Finally, when a retail store can retain existing customers, they have the ability to prevent the competitors from gaining a significant market share (Mittal, 2015).

Notably, the global marketplace has opened up retail world in a way that the shoppers have the potential to source for products based on the prices, range review and also recommendations. Moreover, customers are expecting to be served in a more sophisticated and also flexible so that all the components can meet their demands that are offered when and also where it is convenient for them. Therefore, for the retailers to be able to meet some of the unrealistic demands there is need to put the customer needs first, by ensuring that the needs of customers and their satisfaction is prioritized, the retailers have the ability to meet the need of each and every client. Furthermore, customers want a seamless brand experience despite the channel used to acquire the products and services (Narteh & Kuada, 2014). Therefore, the retailers have to evolve from considering an individual customer and direct transaction approach which is holistic for retail operations. The customers lives at the heart of the retailers business. These extend from clicks and collects, live chats, delivery to the client's location or the shared baskets. When all these elements are brought together, the retail service is deemed right by prioritizing the business around the consumer preference. Retailers that have the ability to achieve customer satisfaction, have a significant opportunity not only to differentiate but also distinguish the value for the customers (Kuada, 2014). Customer Service Training

The key to customer service is to ensure all the employees in the organization embrace customer satisfaction through training and development both from an individual and also team level. For a company to effectively create a culture of customer satisfaction starts with effective management and the leadership having accurate measures on how to ensure customer satisfaction at all the business aspects. Customer service entails the sum of what a company does so as to meet the customers expectations and needs and do their best to produce customer satisfaction (Wu, 2013). Customer service can be used as a useful framework to look at various aspects of the business including; the image and presentation of the company, promotion of the business products and services, contact and communication with the customers. Ability to monitor and improve the business services, resolve the client's problems and complaints and manage the client relationship.

Good customer service builds loyalty and trust not only between the customers and the sellers but also the employees have the ability to create a harmonious working environment. Below are noted five essential employee customer training skills. Allowing the employees to put themselves in the shoes of the customers by role playing, this gives them an insight of how the customers expect to be treated. Customers hate to say the word NO in place employees need to be trained on offering the clients with alternative and give them options. Customers enjoy being served by a pleasant attendant. Thus it is vital that the employees are stressed on the need of having the right attitude at work and constantly smile while at work (Wu, 2013). Moreover, by calling a customer by their name further help establish a rapport and have a positive impact on the customers experience with the shop. Occasionally hold a focus group to hear the customers feedback. When the employees are given an opportunity to hear feedback from the customers they can improve on their weakness and give them room to learn further.

The customer satisfaction model can be categorized with three steps. Fist at the bottom of the pyramid there is meeting the essential requirements of the customers which prevent the customers complaints. Second is satisfying the unstated customer needs which translated to developing the client's confidence. Third at the top of the pyramid is achieving the client's delight which allows the retailers to build the customers loyalty. With the appropriate training of the staff on the importance of customer service, more employees will be able to move the acquired customers from the bottom of the pyramid to top of the pyramid where they translate to be loyal customers. Retail Customer Service Strategies

Customer service strategies can be encouraged through the company with the creation of customer charter or code of practice both expectations of the employees and also the customers. Benchmarking the business activities against other organizations also allows the company to gauge themselves in the industry adequately and can properly work on improvement strategies. Lastly, the company can create and monitor specific measures of the customer satisfaction policy.

A business that wants to build loyal customers and deliver positive experiences to their clients need to engage the people. Over the years retail companies have been credited to set a high bar for providing an excellent customer service including in the social media. Going where the customers are, man customers nowadays prefer to make online purchases. Therefore, for the retail business to make most from their clients there is a need for them to join major social platforms like Instagram and Twitter. With the massive audience present in the social platforms companies have an opportunity to sell their products still and keep interaction with the customers by addressing some of their concerns and needs.

Personalization interactions with the customers notably have a positive impact on the customers. Research has proved that 77% of the clients who had personalized interactions with a brand are not only likely to buy the product but also will refer other customers to the company (Blut, Frennea, Mittal, & Mothersbaugh, 2015). The tactic is also very efficient and easy to implement. Especially if it is on social media, many users include their names in their handle and also the profiles thus by giving a personalized touch allows the customer to feel valued and heard.

Also, it is paramount that the employees can respond to both positive and negative comments. When customers are provided with sufficient information often attribute to an excellent shopping experience, and they end up shopping more frequently and spending more money on the company products and services. Moreover, it is paramount that employees can respond to customers quickly often customers prefer to be answered wi...

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