Retailers Sabotaging Sales with Poor Customer Experience
As the holiday shopping season reaches its peak, retailers are doing everything they can to attract customers and boost sales. But in their zeal to cut costs and deter theft, many merchants are actually making it harder for shoppers to buy their products, according to a recent article by Retail Dive.
"Retail right now is a mixed bag — some winners and some losers. And a lot of that comes down to the experience offered," said Nikki Baird, vice president of strategy at retail tech firm Aptos. Shoppers today simply expect more from the in-store experience than they did five years ago.
One glaring example: the increasing prevalence of locked-up merchandise, especially at drugstores and big box chains. While 62% of customers will wait for an employee to unlock the case, over 25% will abandon their purchase or shop elsewhere, according to Numerator research. For younger shoppers and parents, that jumps even higher for everyday items like toiletries.
"When faced with a locked product, there's more than a 1 in 4 chance shoppers will leave that retailer without making a purchase," explained Numerator's Amanda Schoenbauer. Ironically, this knee-jerk reaction to combat shoplifting often backfires due to understaffing.
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"Associates have always been a key factor in making sure stores are safe and secure," noted Brendan Witcher, VP at Forrester. "Without enough of them in place, retailers are forced to find other ways to 'protect' the store."
Self-checkouts are another sore spot when it comes to connecting with customers. Experts argue retailers are missing the point by viewing them mainly as a cost-cutting tactic.
"The folks missing the boat are viewing self-checkout as a cost-savings opportunity, which ignores the sole advantage of brick-and-mortar retail, where you have human interactions," said Brett Wickard, founder of FieldStack. His data shows more genuine staff interactions lead to higher engagement and loyalty.
Online, thoughtful curation and detailed product info are crucial as 80% of holiday shoppers research and compare prices digitally before buying, per Circana. But many retailers still fall short.
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"Where many retailers continue to fall short is either overwhelming buyers with choice or not giving them enough information in order to make that confident selection," explained Kristin Naragon of Akeneo.
Compounding these issues, aggressive staff cuts mean customers are greeted by ghost town aisles even at upscale chains like Macy's and Nordstrom. Over 40% of shoppers find in-store experiences less enjoyable than pre-pandemic, with most blaming poor staffing, Theatro found.
While slashing payroll delivers a short-term profit bump, the long-term effect is anything but, Wickard cautioned. "You can never under-allocate customer service... when other retailers are under-serving customers, you should actually be doing the reverse and investing in that because you are going to have more and more customers who are going to be entering your doors."