Walker Information releases groundbreaking Walker Loyalty Report for Retail(email this article)

Retail customers are sending a clear message that there is no substitute for good customer service.  As it becomes more difficult for consumers to differentiate between products, many customers say they’d rather pay more for the same items as long as they receive good customer service in a timely fashion.

A soon-to-be-released national retail study on customer loyalty in the retail industry shows consumers believe retail staff are fairly knowledgeable and mostly helpful.  However, finding staff to solve a problem, answer a question, or simply check out can often be a frustrating experience that leads to a drop in loyalty and opens customers to competitive offers.
The Walker Loyalty Report for Electronics, Home Improvement, and Drug Stores reinforces similar findings across other industries in which consumers expect their service providers to increase customer focus to earn loyalty.

According to this targeted retail study, which examined customer loyalty in targeted retail sectors, 90 percent of customers say they are at least satisfied with their retailers.  But less than 50 percent of retail customers in those categories can be considered truly loyal – those who want to continue their relationship and plan to continue buying from their current most-frequented retailer.  Loyal customers are likely to shop more frequently, increase their purchasing, and recommend the retailer to others.

Another 43 percent consider themselves trapped – those who are less than pleased with their retailer but plan to continue shopping until a better offering presents itself.

Walker has developed and refined its concept of loyalty for both customers and employees since the 1970s.  Loyalty goes much deeper than a general measure of satisfaction.  Truly loyal
customers are strong advocates and will commit their purchasing power to enrich such strong retail relationships.

"A surprising number of retail shoppers are trapped," said Jeff Marr, loyalty expert and Walker Information group vice president.  "They're locked-in for one reason or another.  For some, it may be habit, for others it could be location that trumps the dissatisfaction of the shopping experience in the short term.

"But if retailers don't become more customer focused, it's only a matter of time before customers go around the corner to a competitor that can provide a better shopping experience."

Customers seem particularly concerned about the ease of finding the products they're looking for as well as the time it takes to check out and pay for their items.  About 40 percent of customers surveyed say they had a difficult time finding the products they wanted while 45 percent say they were unhappy with the time it took to check out.  Both are important drivers of customer loyalty.

Home improvement customers were the least likely to be pleased with the availability of sales staff while consumer electronics businesses fared the worst in the check-out time category.  While none of the industry sectors were standouts, pharmacists managed to garner a top-tier rating – ranging from 83 to 91 percent – when customers were asked about their knowledge, availability, and helpfulness.  The same could not be said for other pharmacy sales staff who rated no better than those in the home improvement or consumer electronics sectors.

"The sales process can be a turnoff, and the message to the retailers is straightforward.  You have to make it easy for people to find what they want and help them make the right choice for their needs," said Bob Kizer, Walker Information group vice president who heads up the company's retail practice.  "The fact that four in 10 consumers are willing to pay a little more for qualified sales assistance cries out for retailers to solve the sales personnel equation of the shopping experience, both from a quantity and quality perspective."

In addition, the study suggests retailers take a hard look at the check-out process to make purchases quicker and easier.

A retailer's ethics also play a factor in customer loyalty.  Less than 60 percent of customers believe the retailers with which they do business are highly ethical.

Walker's research questions are designed to collect candid responses regarding customer perceptions and attitudes to find out what they're thinking, why they stay, and why they leave.  The Walker Loyalty Report for Electronics, Home Improvement, and Drug Stores indicated:
** At least 60 percent of customers surveyed believed their retailers represent the best brand in the industry, and 51 percent prefer that particular brand over other available brands.
** Only 68 percent of consumers think their most-shopped retailer cares about its customers.
** Only 45 percent of customers surveyed like the advertising their retailers produce.
Findings from The Walker Loyalty Report for Electronics, Home Improvement, and Drug Stores represent a critically important opportunity for retailers to improve sales revenue and, ultimately, loyalty.  It is critical for retailers to gain a competitive advantage in a sluggish economy where very few consumers plan to increase spending.  Just 19 percent of consumers surveyed say they plan to increase this year's level of holiday spending over 2002, and 23 percent say they plan to make more online purchases in the next 12 months.

About The Walker Loyalty Report for Electronics, Home Improvement, and Drug Stores
As part of The Walker Loyalty Report series, a nationally representative panel of customers at least 25 years old was surveyed about personal retail experiences in home improvement centers, consumer electronics stores, and drug stores.  Survey respondents were asked to specify and evaluate their primary retailer in each of those broad retail categories.  Overall, 6,141 evaluations of retail experiences were provided by 3,682 survey participants.

About Walker Information
A privately owned, Indianapolis-based company with offices in the U.S. and Canada, Walker Information is the global authority in customer loyalty management.  Through gathering and analyzing information that transforms businesses to better understand and serve customers, Walker also conducts critical business research in the areas of employee loyalty, corporate philanthropy, and business ethics for companies of all sizes.  For more information, visit the company’s website at www.walkerinfo.com or call 317.843.3939.