Retailers Still Not Giving Customers a ‘Wow’ Experience

IBM Assessment Finds Many Falling Behind

Author: Andria Cheng

May 4, 2017

Customer experience is a big retail buzzword these days, but when it comes to actually delivering a “wow” experience to consumers, retailers are generally falling short.

A 25-country study by IBM found that on a scale of 0 to 100, retailers scored a subpar 33, and worse yet, they missed the mark on areas such as personalization, store and mobile experiences—key aspects of customer experience. In fact, the study ranked only 3% of brands as “leading edge,” compared with 39% of them it considered falling or lagging behind.

The study, IBM’s fifth annual customer experience report, covered 507 retail and consumer products brands. Mystery shoppers rated their experience in seven ways: store experience, digital experience, physical/digital integration, mobile experience, omnichannel supply chain, personalization and social media.

In an era when store experience is supposed to be a key weapon that brick-and-mortar retailers use to fend off competition from online rivals, the study sounds a dismal note: the store experience score was basically a failing 20.

Personalization was another area where retailers still have a lot to catch up on. While the industry has been talking about using artificial intelligence and other tools to design personalized products and marketing offers, the IBM study showed 71% of the brands it studied provide only generic marketing messages to their customers. In another example, among brands that offer loyalty programs, 70% don’t allow customers to choose their preferred form of reward.

With Amazon-led online retailers making online product research and price comparison common consumer behaviors, the study found an overwhelming 88% of the brands it assessed don’t give customers the ability to compare products side by side.

Live chat and readily-available customer service are two other features that are widely considered “must haves” for retailers, but here again the study found many companies falling short. It said 61% of brands don’t even provide online chat options. Retailers also have missed the opportunity to use their call center staff to convert sales: 39% of call center agents wouldn’t take orders or try to upsell to IBM’s mystery shoppers while 21% were unable to access customer account details, limiting a brand’s ability to personalize consumer experience.

The IBM study aligns with data from other sources showing that customer experience basics are still elusive. Data from a CMO Council survey of marketers around the world found relatively few companies are able to provide real-time, personalized experiences to their customers.

On the mobile front, it looks like the buzz about proximity and location-based targeting may be more hope than reality for most retailers: only 21% of the brands in the IBM study provide location-based services to drive proximity messaging. Meanwhile, nearly three-fifths of the brands either don’t have a GPS-enabled store finder or they make customers work out routes to the stores themselves. The study also suggested mobile payments are more of an exception than the rule as only 11% of companies offer consumers that option. 

Retailers also don’t seem to be able to equip their store staff with mobile tools to meet the demands of mobile-phone toting consumers: 79% of brands either lack mobile-enabled store staff or don’t offer them mobile access to customer information.

While reviews have been proven to be a good way to increase sales conversion, 35% of brands still don’t offer access to customer reviews in any sales channel, according to the study.

That “can both frustrate customers and increase operating costs, as inquiries must then be routed through telephone or e-mail instead,” the study found.