Member Article

What does the future of customer service look like for small retailers?

We all know that the first rule of the service industry is that the customer comes first. Customer experience – from first interaction through to purchase - is crucial in helping businesses to secure repeat custom, with customer service a vital cog in the retail machine.

But with the ongoing struggle the high street is currently facing, do we need to re-evaluate how customer service and customer experience sit within operations, to help turn around the decline? Take John Lewis, for example; often seen as a leading light when it comes to customer service. However, this high street giant has recently issued a significant profit warning and plans to close some Waitrose stores. Does this mean that good service will no longer save retailers from the current harsh retail climate?

This is an interesting issue for all retailers, no matter what their size or specialism, as the ‘death of the high street’ is a term we’re all becoming far too familiar with. However, for smaller retailers, who can’t rely on multi-million pound advertising campaigns or brand recognition to save them, how can they continue to delight customers and generate repeat custom when some larger brands can’t seem to achieve this?

For over a decade now, digitalisation has, to various degrees, been disrupting the retail sector. In our 24-hour society, customer service lines open from 10am-4pm are no longer good enough, and no online presence means missing out on the high number of online shoppers (UK consumers spend the most online per household internationally ). Added to that the range of digital channels people use (phone, email, social media, instant chat and so on), customer service has become truly multidimensional.

It’s important that customer service sits close to the operational heartbeat of a business and, if we adopt the right trends, retail, as we know it, could be on the edge of a revolution. A critical part of any organisation’s design, now, is truly understanding how technology will sit at the centre of operations in five, ten, fifteen years’ time.

Below are some technological considerations when designing our services businesses of the near future.

AI is the next contactless

Artificial Intelligence (AI) is already being integrated by brands – from low-level use such as chat-bots through to more high-level integration, like Commerzbank utilising the technology to help write analyst reports. However, there are still challenges around the technology. For smaller retailers in particular, budget can be a barrier, as cutting-edge technology isn’t cost effective. However, investing in it now could help free up savings in other areas of the business.

For example, using AI to automate lets people add value elsewhere. IBM has already predicted that by 2020, 85% of customer interactions will be handled by AI. This not only makes the process more uniform for customers, but it also means that those who were previously dealing with customers can be used more strategically – focusing on building customer relationships instead of overcoming day-to-day grievances. It also makes employees more productive. The opportunity of AI is in removing repetitive tasks from our experienced teams, to enable them to add more value while providing them more variety in their day job. This better sense of fulfilment will also encourage a more positive engagement with customers, which in turn should improve their experience and drive CSAT.

Data that’s bigger and better

There’s no denying that over the last few years, big data has been treated by many as the new oil. One aspect of customer information which is helping retailers to drive demand is predictive analytics, with many of the bigger retailers using historic data to predict what customers will buy, before we know ourselves (!) This innovative model can help brands align themselves more closely with future demand, which should in theory help with stock management, whilst driving sales. For smaller retailers, and for those without an online presence, adopting this technology will be an issue, as this is largely driven by loyalty card data or browsing habits. Tracking stock trends over time could help pin-point supply and demand peaks and troughs, or getting to know customers closely can encourage them to take recommendations based on trust.

Speed of service

In today’s time-poor society, it’s not hard to see why businesses are turning to speedy deliveries to delight customers. However, for smaller retailers, this service isn’t always possible as they can’t rely on the economies of scale which the likes of Amazon can. But little tweaks to how customers experience your service can make a real difference. For those operating physical stores, not enough emphasis can be put on the importance of eye-line – think where customers will look so they can find what they want quickly. Clear signposting is also helpful – how often do you walk down an aisle in a supermarket hoping to find something, only to be told they’re somewhere else? Don’t presume customers know where something will be, so make the process logical.

This mantra is the same for online – making it easy stops basket abandonment. Barclays has estimated that retailers could generate a further £10.5bn within the next five years by streamlining their online purchasing systems , so investing time and effort into website navigation could lead to a significant uplift. People are so savvy now and will always shop for the best deal. So, encourage them back with a smooth experience and enticements so you’re always top of mind when it comes to repeat buying.

Customer service used to be what retailers could hang their hats on, to encourage customers back through the doors. Whilst implementing these new technologies can be too costly for smaller retailers, there are many services designed for small business owners that level the playing field with the bigger businesses. Small businesses should engage customers and give them what they want; a smooth, quick experience. Can’t implement AI? Just make sure you’re implementing a good customer experience. After all - no technology can replace service with a smile.

This was posted in Bdaily's Members' News section by Nikki Flanders, Chief Operating Officer, Opus Energy .