Few Retailers Implement Customer Centric Approaches, Says Study

According to a recent Retail Systems Research (RSR) report entitled "The State of Retail Workforce Management," retailers definitely believe that employees are critical to their customer centric strategies. However, few retailers have confidence in their ability to effectively manage their workforce in order to implement a strong customer centricity program.

Nikki Baird is the managing director of RSR. In a Nov. 6 press release, she says that "retailers exhibit highly conflicting behavior when it comes to their workforce. On the one hand, they say that employees are critical to their customer service strategies, and have become even more so over the last three years. On the other hand, they continue to under-invest in the tools that could help turn front-line employees into real assets to the business."

One exception, however, is Best Buy. In an online article entitled "Best Buy Rolls Out Customer-Centricity Program," author Martin Middlewood of CRM Buyer says that Best Buy not only believes it has the best deals in consumer electronics, home-office products, entertainment software and home appliances, but the company wants customers to keep buying. To accomplish this goal, Best Buy is putting customers at the center of what the company does.

Putting their money where their mouth is, Best Buy completed a year-long customer centricity pilot program in 32 stores. They then followed up with a plan to "spread the customer-centric gospel to 110 more North American stores and to allocate $50 million in capital expenditures to those stores," says Middlewood. Reportedly the 32 stores in the pilot program showed seven percent sales gains over other Best Buy stores in the U.S. Further the percentage of shoppers who actually buy something also improved by six percent over the stores not in the pilot program.

RSR says that specialization of the workforce is a significant strategy that other retailers are pursuing to enable higher levels of customer service. "But," says Baird, "will this mean that we'll all have great shopping experiences this holiday season? Unfortunately, no. To date, customer-centric strategies have primarily been focused on creating a store assortment that is tailored to the demographics of a store's customers. Before frontline employees can be an effective part of these strategies, retailers need to move away from treating their workforce as a tool of customer service and more as an asset that, when invested in and managed well, responds in kind -- happy employees that make for happy customers."

So far, says the RSR report, larger retailers such as Best Buy are leading the way in transforming employee management from scheduling and attendance, into a strategic plan to win customers and increase sales.

Sources:

Press release, Few Retailers Believe They Effectively Manage Their Workforce, Study Finds; http://www.prweb.com/releases/2007/11/prweb566616.htm

Article, "Best Buy Rolls Out Customer-Centricity Program;" http://www.crmbuyer.com/story/33698.html