Customer service still matters. Despite the much-discussed rise of e-commerce, roughly 80% of sales continue to take place in brick-and-mortar store -- but to win their share of that business, retail leaders must recognize that they're in a constant battle to prove themselves to the public.
That situation is reflected in the 2018 Retail Reputation report from Reputation.com which "details consumer sentiment about in-store experiences with different retail brands" across nine categories "from value to service to wait times and more."
The report shows that there's a direct link between what Reputation.com calls a retailer's "Reputation Score" and store sales. "Chains with high Reputation Scores saw same-store sales increase 2.8%," according to a press release on the study. "Chains with low Reputation Scores suffered a 1.1% decline in same-store sales, making for a total difference of 3.9%."
The top retailers for in-store experience listen to customer complaints and make quick corrections. Image source: Getty Images.
How does it work?
According to Reputation.com, it creates its scores by applying "artificial intelligence, machine learning, and sentiment analysis" to 4.7 million consumer reviews posted on social media. Those reviews offered details on what it's like to shop at nearly 30,000 locations across 88 retail chains, according to the press release.
"Based on these reviews, social media sentiment, business listings accuracy and other factors that reflect consumers' spontaneous opinions about their search and in-store experience, each chain was given a Reputation Score," according to the press release. "The industry-average Reputation Score for retailers in 2018 was 538 on a scale of 1,000."
Which retailers offer the best in-store shopping experience?
What's clear from the report is that retailers need actively manage their in-store experiences. Consumers clearly have high (and rising) expectations, and businesses will not meet them by accident.
"The perfect shopping experience, far from being a matter of chance, happens when a retailer fully understands -- and has the information to fully manage -- every facet of the consumer's journey, from the web to the four walls," wrote Reputation.com executives Brad Null and Mark Lange.
This year's top 15 retailers, according to the report, are:
- 15. Victoria's Secret
- 14. L.L. Bean
- 13. Ace Hardware
- 12 Michaels
- 11 Bass Pro Shop
- 10 Hobby Lobby
- 9 Costco
- 8 Publix
- 7 Disney Store
- 6 REI
- 5 Barnes & Noble
- 4 Wegmans
- 3 Nordstrom
- 2 Trader Joe's
- 1. The LEGO Store
With a 695 on Reputation.com's 1,000 point scale, The LEGO store edged out Trader's Joe's, which scored a 690. L Brand's somewhat troubled Victoria's Secret chain scored a 602 -- well above the retail average of 538 -- to land in 15th place.
Consumers are winning
"It's notable that excellence in customer experience was demonstrated by such a wide range of players." wrote Null and Lange. "No single retail segment dominates the rankings this year. Retailers can lead in consumer sentiment from any category."
Social media and online review sites have put added power into the hands of consumers in terms of calling out businesses for their failings, and rewarding them for their successes. One the one hand, that puts the onus on retailers to take the initiative to devise better customer experiences; on the other, the near-instant public feedback allows them to make quick corrections when things go wrong. Both offer big upsides for shoppers -- and for the companies that are winning the reputation game.
