Less than one in five British consumers (17%) say they intend to make purchasing decisions based on the lowest possible price, according to a survey by customer experience improvement firm Retail Eyes.
With consumers counting every penny following the UK's recent rise in VAT (sales tax) from 17.5% to 20.0%, many retailers are doing all they can to keep prices low to attract shoppers - often through aggressive promotions and discounting.
But while this price-based approach does undoubtedly have short term benefits, it will certainly be unsustainable in the long run and ultimately leave customers feeling disappointed.
According to Tim Ogle, CEO for Retail Eyes, rock bottom pricing is not necessarily the best way to attract, and retain, customers: "This survey has shown that 83% of shoppers are looking for added value for their money. Obviously, with their margins being squeezed by rising costs, retailers need to find cost effective ways to add value - one of which is through exceptional customer service."
Customer service has historically been seen as an interaction to deal with a customer when something has gone wrong or simply serving the customer in a transactional manner. Retail Eyes believes that retailers should go a step further and expand the 'customer service' concept to 'customer experience', placing the focus on creating an experience that customers remember and want to revisit.
"Customers are subconsciously running value equations throughout their entire experience and that includes more than just price; it includes the whole experience," said Ogle. "It is your employees, especially those on the front line, who can really make a retailer stand out from the crowd by committing to make every customer's experience the very best."
The consequences of getting this wrong can be severe: "Get the overall customer experience right and retailers can expect to see the results positively impact at the tills. Get it wrong however, and shop staff who see their job as 'just a job' can have a negative impact - destroying a retailer's reputation just by simply ignoring customers," warned Ogle.
Retail Eyes' recommendations for creating an outstanding customer experience include:
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