How Consumer Behavior Is Fueling the Future of Retail CX

How Consumer Behavior Is Fueling the Future of Retail CX TW

A whole new demographic of buyers were forced to do their shopping online in the past year, and leaned more heavily on customer service teams to feel comfortable and confident about their purchases. While post-transaction support, like order status and return initiation, likely will never subside, CX teams can now take on more of a revenue-generating advisory role, answering product questions or directing customers to better alternatives.

Kustomer talked to thought leaders in the customer experience space to understand what they think the future of retail CX looks like, how to re-create the in-store experience in an online world, and what tools and strategies brands should tap into in order to achieve this. Read on for a preview, and access the full e-book here.

The Shift to Digital-First

With most businesses closing their storefronts (at least temporarily) or minimizing capacity during the global pandemic, consumers were forced to shift their shopping online. While it is inevitable that commerce will partially shift back to brick-and-mortar once things go back to “normal”, there is now a massive new pool of consumers that are comfortable shopping online, and you can expect this increased volume of e-commerce and digital inquiries to continue. In fact, according to Shopify, a whopping 84% of consumers shopped online during the global pandemic, and 48.8% of consumers will continue to shop online more frequently after the pandemic is over.

It is imperative to consider how new online shoppers will be interacting with your brand in a digital-first world. How do you make it easier for them to get their questions answered? How do you make sure you’re able to surface the correct information and resources to a customer in their times of need? How do you ensure you are able to deliver a seamless experience when consumers switch channels or move from in-store to online?

Creating a Unified and Effortless Experience

According to Alexander Richards, Director of Partnerships & Business Development at Medallia, the future of retail involves seamless and connected shopping experiences. “For a long time now, online and in-store shopping have been treated as separate entities that fall under the same brand, and sell the same goods, usually leaving advocates frustrated. Just because a brick-and-mortar store uses one POS platform, an online store uses another, and they don’t talk to each other, this shouldn’t impede the sales and support teams. Most of all, it shouldn’t impede the customer,” says Richards. “Brands are becoming smarter, more customer-centric, and know they need to meet their customers where they are in this omnichannel world. Our jobs as technology companies are to provide solutions to enable and support these effortless experiences.”

Incorporating digital-first support strategies into the overall online customer experience will make a huge difference when it comes to brand equity and loyalty. Consumers that perhaps would walk into a store to check out a product or ask a question to an in-store representative, now require that service in an online environment. Instead of tracking down a phone number or e-mail address, a chat widget or in-app messaging may be the most convenient option to get a question answered. In fact, according to recent consumer research conducted by Kustomer, live chat continues to grow in popularity with consumers, now ranking as the second most popular channel to get customer service problems solved.

Keeping Things Personal

However, digital CX should not mean impersonal CX. Customers still want to be treated like real human beings, with unique thoughts and preferences — not like anonymous transaction numbers. According to Kustomer research conducted during the pandemic, the top three most valued customer service attributes are:

  1. Empathy
  2. Personalization
  3. Speed

In order to truly deliver the in-store experience in a digital world, retailers must not lose the human touch. Consumers expect to be treated with empathy and personalization, even when they aren’t interacting with a company representative face-to-face.

Says Blake Morgan, Customer Experience Futurist, Bestselling Author, and Keynote Speaker, “The future of retail is personalized. Retailers will use technology to create bespoke experiences that are completely tailored, at scale.”

Want to learn more from CX experts on how to recreate the in-store retail experience online? Check out the full e-book here.

 

Kustomer to Showcase its Customer Service Platform for Modern Retailers at NRF 2020

The retail world is coming to New York next week for the National Retail Federation’s ‘Big Show’ and we’ll be there at Booth #962. Over 38,000 attendees and more than 800 companies will be descending on the Javits Center from January 12th-14th to share perspectives, experience new technologies, and chart a vision for 2020 and beyond.

The 2010s forever changed customer expectations. And by the end of the ‘20s, we believe that the top retailers will have built lasting customer relationships by creating differentiated, frictionless customer experiences that focus as much on how they serve customers post-sale as they do on the rest of the customer journey. Retailers that unify customer data and empower their agents will better understand customers and deliver personalized experiences, however they happen to engage.

The good news is we can help. If you’re going to be at NRF 2020 Vision, our team of service and technology experts are available to discuss forward-looking customer experience strategies. In addition, we will demonstrate how the Kustomer platform can help you blow away the competition in the years ahead by providing real-time, actionable customer views, continuous omnichannel conversations, and intelligence that automates customer and agent experiences.

While you’re at our booth (#962) you can also pick up a Kustomer beanie to keep warm during the walk from the convention center to your hotel and other activities around New York. You’ll also be able to enter our twice daily drawings at 1PM and 4PM to win gift cards from leading customer service retailers we’re proud to call our clients, such as UNTUCKit, Glossier, and Away.

And of course stop by the Kustomer Stage (Hall E, Level 1) for insights on the future of retail from leaders at brands like L’Oreal, The Vitamin Shoppe, Lush Cosmetics, Williams-Sonoma, Zappos, Patagonia, and more.

If you can’t make it by the booth (#962), but still want to chat about how Kustomer can help you reimagine customer service, please contact us, anytime.

 

What Consumers Expect from Retail Customer Service

Modern day consumers don’t think of relationships with retail brands as simply transactional — they see brands as an extension of their identity. That’s why building relationships with customers, and treating them as part of the brand, is imperative for business success.

According to a new Kustomer survey, nearly eight in ten Americans say that they wouldn’t shop with a retailer ever again if they encountered bad customer service.

From social media to old fashioned emails, Americans contact retailers 125 times a year – that’s every three days. The survey of 2,000 Americans asked their thoughts and opinions on customer service practices and experiences – and found that Americans aren’t that forgiving when it comes to bad customer service experiences.

In order to remedy their relationship with retailers, 82 percent of respondents are in agreement that retailers should proactively reach out when there is a problem with an order. Those most likely to agree with this sentiment were those aged 55 to 64 and those 65 and older – at a whopping 90 and 94 percent, respectively.

One point of contention between generations, is whether retailers should know their consumers and personalize their interactions with them. Of those age 25 to 34, three-quarters said they expect this personalized communication from retailers, whereas those 65 and older disagreed with this notion at nearly 40 percent.

“It’s clear that the digital age has transformed what the modern day consumer expects from retailers,” says Brad Birnbaum, CEO of Kustomer. “The younger generation not only wants instant resolution to their problems, they also demand personalized interactions and availability across all channels. Retailers must put a customer service strategy in place, and leverage the right tools, to deliver on these expectations.”

This older generation also disagrees with the age-old expression that “the customer is always right” – at 58 percent; but over half of those 65 and older, get very frustrated when they have to repeat information to customer service – that’s 10 percent more likely than those aged 18 to 34.

Sixty-six percent of those aged 25 to 44, however, do agree that “the customer is always right.”

Perhaps speaking to this expression, over half of respondents said they would post an online review after a bad customer service experience, and another four in ten (41 percent) would take to social media to complain.

In order to avoid the hassles of bad customer service experiences, 74 percent said they would spend more money just to get better customer service.

“Customer service can impact business success from end to end,” says Birnbaum. “Delivering a bad experience could not only mean a lost customer, but also a PR nightmare. Conversely, by providing exceptional service, customers are willing to spend more time and money with your brand, building brand loyalty and lifelong customer relationships.”

Read our retail report to access the full survey results, including insights on the importance of real-time support, personalization and omnichannel service.


Read Report

 

How 4 Retail Brands Deliver Modern Customer Support

What are the core principles of a modern retail customer experience? Personalization, curation, agility, and community. Direct-to-consumer retail brands use owning the design, marketing, distribution, and support of their products to build deep relationships with consumers. As a result, many DTCs have transformed customer support into personalized experiences that build loyalty and lifetime value.

Luckily, Kustomer works with many of the leading DTC brands. So we’ve pulled together a few of their customer service secrets for you:

Glossier builds products with their community of fans

A lot has been written about the CX revolution led by cult-fave-turned-unicorn beauty brand Glossier. A key part of Glossier’s success has been thanks to community building (the brand was of course born out of a popular blog) and the customer experience team, called their gTeam, has been instrumental in growing and engaging this community.

Glossier’s gTeam plays a foundational role in bringing community feedback into product design. The company is known for transforming customer feedback into hit products (see: Milky Jelly Cleanser). “They help us figure out and predict all of the questions or concerns that our customers might have about the product,” explained Jessica White, the executive director of customer experience, to Glossy.

 

 

The gTeam editors also go beyond transactional support (shipping, coupons, etc) to deliver complimentary style recommendations. The editors focus on specific channels, including ones not typically covered by support teams, like FaceTime. In combination with digital tools like the Shade Finder app and content illustrating how products look across a range of skin tones, this approach has helped the beauty brand recreate the experience of shopping in a makeup store.

“Instead of limiting interactions with customer service, which is the norm in the industry, we strive to create conversations with our customers,” continued White to Glossy.

The results of this CX investment for Glossier? Reddit threads literally raving about the brand’s customer service.

ThirdLove invests in a culture of CX and smart data

ThirdLove shook up the women’s undergarment industry with personalized recommendations for every body type, money-back fit guarantees, and diverse product models. Which brings to mind the now-famous Victoria’s Secret founder story of feeling unwelcome in the women’s section of a department store and proves how CX complacency can lead to history repeating itself — disruptors becoming the disrupted.

Customer service is such an important differentiator to ThirdLove that the brand invests in Customer Experience centers designed to be great places for their support teams to work. (Proof? There’s even an office slide.) ThirdLove’s Fit Stylists who work there receive training to make customers comfortable during their journey trying and buying intimate apparel, a personal process that can make or break customer loyalty.

As the company’s co-founder and co-chief executive officer, David Spector, explains to Apparel News, “We want to provide exceptional customer experience to people. The only way to do that is with our own team.” Spector also points out that the U.S.-based Experience Center helps ThirdLove’s Fit Stylists form deeper connections with their American customers than outsourced support would.

Like Glossier, ThirdLove also incorporates customer feedback and data into its buyer journey. More than 13 million women have completed ThirdLove’s online Fit Finder tool, resulting in more than 600 data points the brand uses for product development and delivering recommendations back to customers.

Outdoor Voices invites participation in

With a brand that’s about #DoingThings, Outdoor Voices is another DTC brand thriving because of its (extremely on-Instagram) community. The Outdoor Voices Brand Reps play a key role in letting customers know what the brand stands for, why it’s different, and what each clothing item was created for. According to Muse, Outdoor Voices HQ and Brand Reps have monthly video chats to discuss brand news and initiatives.

To make contacting support simple and on brand, Outdoor Voices has a welcoming page and easy-to-navigate support page. By making its email contact “hello [at] Outdoor Voices,” the “support” vibe is swapped for a friendlier, conversational tone.

Like other leading DTCs, Outdoor Voices leverages customer support as a product and trend feedback engine. The company’s recent job posting for a Customer Experience Manager explicitly lists a requirement to “Operationalize customer data and feedback, both within the team (e.g. measure and improve Associate performance) and the company at large (e.g. make customer trends actionable).” This invites fans into the product development process, with customer support as the entryway.

LOLA designs support workflows for empowered agents

Like ThirdLove, LOLA is disrupting traditional brands in another very personal space for women: feminine care and sexual wellness. The brand’s customer service team must handle deeply personal topics from customers, often over email. To return the trust their customers have in them, LOLA’s team goes above and beyond to make sure their products are rushed to women wherever they need them. From sending tampons to a customer’s hotel via Uber, to overnighting condoms so that they arrive in time for a honeymoon, LOLA works overtime to create a memorable experience.

For a recent product launch, the Lola team took it as an opportunity to both reward loyalty and gather feedback. They sent 100 loyal customers mailers of their new Sex by LOLA products. One customer even emailed to say that she loved the products and, as a single mom, they inspired her to start dating again.

For a brand that empowers and informs women, LOLA’s team needs to be just as empowered and informed by their technology solutions to deliver great service. Context Cards enable the team to take direct actions such as modifying, cancelling, or scheduling a subscription, and checking on shipping status for an order. Clicking on “Modify,” for example, takes them directly to the customer’s subscription, where they can edit the frequency, products, etc. This makes it easier for the team to spot orders that have been placed, but may need modifications. LOLA has a search for customers who have emailed and placed an order in the past day, so that agents can make modifications to the order before it actually ships.

Key takeaways:

5 ways to deliver CX like DTC leaders

  1. Consider customer service on the front lines of community and relationship building, not simply a necessary business cost.
  2. Operationalize mining customer conversations for product feedback by support to bring product ideas back into the company.
  3. Use technology to compliment the role of support agents, through algorithm-based recommendations, self-service fit finder tools, and seamless exchanges/returns.
  4. Empower your support teams to go beyond transactional support, have social conversations, and reward loyalty.
  5. Build service conversations off a shared history and understanding that customers are people, not support tickets.

These approaches can benefit any brand, regardless of business model, because they’re key to delivering the type of service customers want and expect. Evaluate your own service operation to see how you compare to these DTCs, and then look for scalable opportunities to deliver a more modern experience — it’ll pay off in community, loyalty, and lifetime value.

Learn more secrets of DTC brand leaders in our downloadable guide.


Read Whitepaper

 

The Future of Retail: Four Essential Takeaways for B2C and DTC Brands

Kustomer’s Future of Retail event brought together business leaders from leading modern B2C and direct-to-consumer (DTC) brands, featuring a majority of female founders and executives across the agenda. Together, they discussed the trends that are shaping the retail and DTC landscape today, and what it takes to compete and thrive in this world.

We covered a range of topics, from understanding the customer to creating a consistent experience in-store and online and growing a business. However, four main threads emerged from all the conversations at the event:

1) Experience is the differentiator for modern brands

Now every retail brand, digital-first or established legacy, is in competition with Amazon. It’s unlikely that most will be able to compete on choice, ease of use, or connectivity of their product ecosystem. The only sure way to win is on experience—curation, community, and content is where you’ll be able to stand out.

A simple, clear business model means you can set yourself apart with your experience and service. Lola does more than deliver all-natural feminine hygiene products, their intuitive subscription service and direct-to-consumer prices, plus their commitment to a personal and engaging experience, makes them much more appealing than mass-market brands.

Fast delivery and a good website is not enough, instead customers crave a community and a genuine experience. Women’s workwear brand Argent even calls their pop-up stores “Community Centers”, where they host events themselves and from members of the community—with the end-goal of adding value to customers’ lives. You can learn more about using pop-ups as part of your retail strategy in our report here: Digital First, Store Next.

Similarly, cycling brand Rapha received a shout out for their innovative Club Houses. Instead of traditional brick-and-mortar retail, they’re a hub for Rapha customers, where they host events, local artists, athletes, and speakers, plus organize daily rides.

As Aniza Lall, Chief Merchandising Officer at Bluefly, summarized: “Commerce, content, and community: the brands that can monetize those channels are going to succeed.”

2) You need an omnichannel approach to connect every touchpoint

From first touch and acquisition to the post-purchase experience, you need to be able to trace a solid line following your customer along each.

More brands are getting their start on Instagram like AYR, or as a source of content like Glossier, and scaling from their with a handful of products. It’s crucial to be able to capture all the information about those early fans that you can, because they will form the core of your audience and define your brand experience.

Eleanor Turner, Co-Founder and Chief Creative Officer of Argent, described the importance of connecting these dots: “Experience is such a buzzword today, but it’s really all about creating an experience that’s unique to your brand, personal, and streamlined end-to-end.”

3) Subscription is the future of customer loyalty

New, digital-first brands are shifting their business model to become part of life and rhythm of the customer. For these businesses, profit comes from retention and lifetime value, and you need to know whether or not customers are happy based on their actions, not their words. Doing so can drastically raise their lifetime value.

Men’s subscription box Sprezzabox uses a loyalty program to reward customers based on how long they’ve been a subscriber, giving them access to higher-quality items and delighting them with special offers.

Feminine hygiene brand Lola partners with other brands like Cuyana, Warby Parker, Equinox, and Harry’s to extend their value proposition and reach new audiences.

Material World has shifted their focus from being a marketplace for secondhand luxury items, to building an ongoing relationship by having customers exchange their old clothing and other items for a new pre-owned set each month. As Rie Yano, the company’s Co-Founder and CEO described, “People used to use the brands they shop for as their identity, but now identity is about how you spend your money, not what you spend it on.”

Brands like Rent the Runway and Material World provide more value for customers with a service that replaces ownership with an ongoing relationship with a brand.

4) Stay laser-focused on what your customers love.

Even as you grow, you need to keep the core facets of your brand and experience that your customers love at the forefront.

Women’s clothing brand AYR launched on Instagram and social 3 months before their product lineup fully launched, just to communicate with their customer and get feedback. It’s remained a huge driver for their business: “Our biggest win has been having a direct line to the customer. We launched our t-shirts, plus-size jeans, and eco-friendly products based solely on customer feedback.” Co-Founder Max Bonbrest also gave a big shout out to Glossier for the same reason, “Having an engaged community before you start selling a product is a huge benefit. The best example of this is Glossier, obviously.”

Similarly, Lola’s brand is built on what real women have to say about feminine hygiene. After having a number of conversations while coming up with Lola’s brand direction, founder Alex Friedman had an epiphany: “I realized that there are all these moments where stigma leads to a lack of discussion. I see our job as contributing to the conversation in those areas and extending the brand in those directions.”

Whether your brand is just getting started or has established itself over decades, the discussions at Future of Retail reiterated that success in the modern retail landscape is grounded firmly in gaining better customer understanding, and delivering a powerful, connected experience.

Thanks to everyone who helped make this event possible, we’ll have even more awesome events and informative conversations like this one coming soon!

Getting Started is Easy

Get a Demo