Customer Experience 2017: Retail Executives Deliver Their Verdict
Few dispute the competitive value of a great customer experience (CE). And yet, how are retail executives experiencing the organizational journey to excellence? Amrop surveyed a handpicked group of senior retail executives from 25 countries.
With the organizational journey to excellence in CE still in its early stages, retail and consumer organizations have a significant opportunity to stand out among their peers.
Questions Surround Strategic Leadership
78% of retail executives say CE is a strategic priority, but only 24% report a single CE owner
If the clear majority of retail executives say customer experience is a strategic priority, only 42% say the agenda is set at corporate level, with as many setting it at a functional, departmental or business unit level. Only 24% say a single executive is accountable, only 4% report a dedicated CE function. So responsibility for strategy setting, execution and monitoring is somewhat diffuse and risks getting lost in an organizational wilderness.
Customer Experience is an Emergent Discipline
In only 4% of cases has a dedicated CE function been installed.
CE mainly remains the preserve of longstanding disciplines such as customer service, sales and marketing. It is still driven by multiple schools of thought and has yet to find its ultimate, specialist owner.
The CEO is the Most Critical CxO Player
69% think the CEO is the most important. But s/he is rarely accountable
Only two executives cited the CEO as accountable for CE. Yet when it comes to the importance of different CxOs in optimizing customer experience, the CEO is by far the most critical, cited as such by 69%. Other critical roles, (for 50%-60% of respondents) include the CMO and COO, and for around a quarter, the CDO, CHRO, or CINO.
CE is Multi-Departmental – With No Clear Driver
Only 12% see digital marketing and related disciplines as leading CE
A wide spectrum of departments are very involved in or fully leading CE, with none the clearly designated leader. Most active are retail operations and CRM, both longstanding functions. Only 12% see digital marketing and related disciplines as leading (even if involved in 41% of cases), although 71% of the organizations are digital or omnichannel. This fragmented picture emphasizes the importance of connected thinking in delivering a great customer experience.
A Rich and Connected Knowledge Portfolio is Called For
Retail operations and data analytics come first
Executives were presented with a range of knowledge areas. Most critical, they say, are retail operations and data analytics, reflecting the comparatively heavy involvement of the CRM and retail operations departments. The importance of data analytics in harvesting and exploiting rich pools of customer data is unsurprising. Perhaps more surprising is the fact that a grasp of digital marketing is critical for only 37% of respondents, and delivery channels are critical for only around a quarter.
Still, many cited more than one knowledge domain as critical, and almost all consider every one of them to be important to some degree.
It is clear that retail is intensively seeking to upgrade its CE leadership talent. However, given the organizational breadth of the knowledge portfolio at work here, designing an effective talent strategy to identify and integrate the right professionals is vital and will demand considerable HR expertise. This may explain why the CHRO is critical for 26% of respondents.
Organizations are Fighting to Fill Leadership Talent Gaps
Only 26% have the right CE leadership talent, 90% are taking measures
Is the diffuse custodianship of CE deliberately engineered for agility and responsiveness? Or is it more a symptom of a lack of leadership? In many cases, it may well be the latter, since only 26% of executives say the right CE leadership talent is on board. Reflecting the strategic importance of CE, 90% of executives say their organizations are training, developing or recruiting talent, with 17% set to recruit in the next 3 years. However, 60% report difficulty in finding leadership talent. This, and other findings in the survey lead us to ask: to what extent is talent strategy fully informed or forward looking?
Crowded Aisles, as Talent Shoppers Play Safe
70% of retail organizations are searching in their own, or related sectors
The difficulty of recruiting CE leadership talent could be explained by the finding that 70% of hiring organizations are concentrating their search in their own, or closely related sectors. Very few are investigating lateral sectors such as leisure, hospitality, tech or professional services, with only 19% looking at start ups. Yet familiarity may not be the best strategy, as the war for top talent intensifies. And employer branding will become as important as product branding in the fight for talent share.
Between Aspiration and Reality, Gaps Yawn
Only 19% of executives say different departments are collaborating on CE
If 78% of executives claim CE is a strategic priority, only around a third say their organizations have installed a strategy, priorities or KPI’s, and just as few dispose of vital information to fuel strategic thinking (a clear picture of customer loyalty, a quantified business case, or KPIs). Confirming our questions surrounding fragmentation, only 19% say their departments collaborate or that there is a clear and connected view of what customers think, feel and experience at all steps of their journey.
Retailers Still Control the Customer Journey
Only 18% of executives say their customers are in the lead – for now
Despite the current state of their game, only around a fifth of retail executives say their customers are in the lead. Yet as customers switch retailers and report their satisfaction online at the click of a button, could it be time for a wake up call?
Despite Big Predicted 3 Year Gains, the Journey will Be a Long Haul
CE will remain a strategic priority for 82% of organizations.
When it comes to setting that strategy, executives predict significant improvements: building a quantified business case, defining KPI’s, setting priorities and informing strategy design thanks to a better understanding of customer loyalty. They also see major improvements in connecting the dots: inter-departmental collaboration departments and a clear and connected view of what customers think, feel and experience at all stages of their journey.
Yet in no area do more than 60% say that the conditions will be fully in place. Even three years down the line, the journey to excellence will still be fully underway.
Customer Experience - 7 Leading Questions for Retail Executives
- In terms of strategic priorities, where do you personally think customer experience should be ranked? How do your views compare with the views of your board?
- How clear are your organization’s CE strategy or related priorities and indicators? What is your hiring strategy?
- At what level is CE strategy currently set in your organization? At what level do you personally believe it should be set?
- Which executives and departments own CE in your organization? What are the positive or negative implications of this?
- Overall, how well equipped is your business to deliver on CE? What could be the consequences of failure, or the rewards for success?
- In your experience, what are the biggest obstacles to delivering a first class CE?
- How should the control of the customer experience be weighted? Towards customer or retailer? Or equally distributed? What ethical dilemmas do you see and what is your stance on these?