The motivation of staff, the efficiency of internal processes and tools, and the company culture can make or break a brand experience. How can retailers take a more holistic approach, and develop, support, and accelerate employee experience (EX) to unlock a connected and memorable service experience for customers?
Covid-19 and the big shift online
The pandemic has resulted in several major, permanent shifts in human behaviour and expectations. As demographer Simon Kuestenmacher observed in an ABC interview, the changes in consumer buying behaviour during the pandemic have been significant. Despite most shops being closed, retail sales rose 11 per cent during lockdown, largely because people didn’t have much else to spend money on. Clothing retail went up 20 per cent, even though people had nowhere to go. Much of this spending was online.
Australian Bureau of Statistics figures show a gradual rise in retail spending since 2013, reaching 6.6 per cent before the pandemic. When Covid hit, this shot up to 11 per cent. Every percentage point increase represents $7.5 billion from bricks-and-mortar retail going online.
Consumer expectations of a flawless, omnichannel digital experience with 24/7 support have driven a shift in the distribution of where workers are needed in the retail sector. The need for fewer staff in-store but more driving and supporting digital channels had sudden, unexpected implications, from the operating model to hiring, training, and development.
Digital Life Index 2021 research indicates that seamless experiences drive satisfaction and influence choices and purchase decisions. Offering an exceptional customer experience is non-negotiable, but it starts with an exceptional employee experience.
The new humanisation of business
Since the pandemic began, the focus has shifted from ‘customer experience’ to ‘human experience’. Employee mental health and wellbeing have become priorities, particularly with skills shortages in many markets and the threat of the Great Resignation. Attracting, supporting, and retaining skilled staff, and ensuring they feel valued and have a great experience, is integral to meeting customer needs. There’s growing awareness of the importance of employer brand, and the connection between engaged, productive staff and business outcomes.
Research by Forbes Insights found that revenue growth is linked to high EX performance (defined as ‘high employee engagement and satisfaction’), regardless of how much companies prioritise CX or not. Businesses with both high-performing EX and CX enjoy twice the revenue growth as those without. Among revenue growth leaders, 76 per cent see EX as a priority; only 29 per cent of laggards do, and 89 per cent of revenue growth leaders also say improved EX leads directly to improved CX.
Gethin Nadin, a psychologist who specialises in employee engagement and the author of A World of Good: Lessons from Around the World in Improving the Employee Experience, says wellbeing at work isn’t just a trend, and wellbeing directly correlates with higher performance and productivity, according to Gallup analysis. “Wellbeing is an investment, it’s not a cost,” Nadin argues. “It should be seen as a pretty standard thing you invest in. We now have very vast and compelling evidence that the poor mental health of your staff has a significant effect on your business. If your employees are suffering, your business is suffering.” Nadin notes that younger workers in particular want to work for caring employers.
Employees who feel valued and engaged are much more likely to be brand ambassadors and connected to company purpose, which results in them creating a great customer experience.
Enhanced experience design and staff engagement
Consideration for the teams behind the scenes – the content authors, creators – transforming, driving, and evolving digital sales and service channels, and recognition of how they perform their roles and engage with platforms behind the scenes is paramount. Their experience needs to be connected to the company’s purpose and vision, and the role they play for the customer – to attach meaning to the tasks they execute day to day. An employee-centred approach puts these colleagues at the centre of designing the back-stage experience.
Digitalisation of retail isn’t just about setting up an online store and fulfilment platform, it’s about agility, support, training, and development. Making space for autonomous flow of colleagues servicing the front- and back-stage CX is incredibly important. Data can play a critical role in supporting staff and empowering employees to anticipate unpredictable customer needs.
When considering how to orient the organisation around the customer, it’s critical to look closely at how business performance KPIs are linked to customer success metrics – from the top down. Traditionally, business KPIs such as sales per employee have been balanced by lagging customer-centric success indicators, such as net promoter score. A pivot is needed to orient employees around leading customer success measures – things that matter to retail customers – such as ‘time to delivery’ or ‘time to refund’. The time it takes for the customer to realise the value they are seeking is a leading indicator of their satisfaction and brand loyalty. These KPIs should cascade to every employee who helps unlock that value.
Retail employers can also have leading employee KPIs. Step away from reducing attrition (a lagging indicator) and instead measure key factors that contribute to culture and staff satisfaction, which will keep them from leaving in the first place. The Gallup Q12 Employee Engagement Survey includes measures such as:
- My supervisor, or someone at work, seems to care about me as a person
- The mission or purpose of my company makes me feel my job is important.
- I have a best friend at work
Gallup’s research shows that, globally, 4 in 10 employees strongly agree that their supervisor or someone at work seems to care about them as a person. By doubling this ratio, organisations could realise an 8 per cent improvement in customer engagement scores and a 41 per cent reduction in absenteeism, Gallup predicts.
Dr Jim Harter, chief scientist at Gallup, says that when people are cared about in an environment, they’ll be more likely to share information with others, and trust other people and collaborate with them, which is foundational to getting anything done: “People who feel cared about…are stronger on almost every outcome we’ve ever studied, including productivity, retention rates on the team.”
The need for diversity and inclusion
Diversity of thought in the workplace is critical because the team designing for and serving customers rarely represents the breadth of the customer segments and mindsets. Implementing conscious, inclusive hiring, training, and company policies, along with human-centred design practices, enables staff to inject the empathy required to generate a great experience for all customers.
In the era of digital transformation, increasing automation and AI, the need for inclusive service design has never been more relevant. And EX must be considered and prioritised in tandem with this technological change.
For example, not long ago I used a pay-at-the-pump fuel app during a trip in rural NSW. It was a beautiful, fluid design and app experience that had worked perfectly when used in Sydney. But after the app had processed my payment at a rural service station, the store clerk accused me of theft. She said she didn’t know anything about an app and called the police. This was a prime example of where the digital product innovation process neglected employee cohorts during design and adoption, resulting in significant customer impact and legal complications.
To achieve business outcomes linked to outstanding customer experience, staff need to understand the customer journey and their critical role in it. A study in Canada identified a direct link between empowering customer contact teams and higher levels of job satisfaction and self-efficacy. Employees need to be connected yet autonomous, so they can respond to customer needs with agility.
To fully implement the optimal customer experience, retail businesses need to take a wider and more holistic view of the elements within the supply chain – one that includes the people who operate that chain; from digital and customer contact teams through to warehouse and logistics staff, as well as all the other departments in the business. Seamless, productive collaboration among everyone in an organisation is what creates a great employee experience that unlocks a differentiated and memorable customer experience.