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Retail Industry Updates

This Is Why Retailers Need to Improve Their Online Customer Service

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If retailers want to continue building their e-commerce businesses, they had better get their proverbial digital houses in order.

That’s according to a new study by The Northridge Group, a management consulting firm specializing in business transformation initiatives, customer experience, contact center effectiveness and quality monitoring services. According to The Northridge Group’s “State of Customer Service Experience 2020” report, 68% of consumers have increased their online shopping as a result of COVID-19 and plan to continue at this increased rate post-pandemic. But many of these consumers are increasingly frustrated at the level of effort required to reach companies to get the help they need.

“As the number of consumers doing business online increases, so too does the need for self-service options that deliver fast and easy ways to contact brands,” said Pam Plyler, executive practice lead for customer experience and contact center management at Rosemont, Ill.-based The Northridge Group. “But with only 42% of consumers reporting first-contact resolution, brands are clearly missing the mark.”

The study found consumers are having to work too hard to resolve their issues, with 73% experiencing long wait times to reach a live agent, 69% reporting difficulty finding answers on the company’s website and 60% having to repeat information over and over again. While business leaders report investing in top service improvements, like reducing wait times, only 29% of businesses surveyed currently measure customer effort.

“If you don’t measure it, you can’t improve it. Implementing the right customer service effectiveness metrics, including first contact resolution and customer effort, can increase brand loyalty, streamline processes and reduce costs,” Plyler says.

Retailers have a tight margin for error because most consumers are unforgiving when it comes to poor customer experience — 73% say they are likely to switch to a competitive brand after just one negative experience.

The survey found the phone remains consumers’ preferred contact channel because it is currently the most effective and fastest channel for issue resolution. However, over the past five years, consumers’ preference for phone and e-mail has declined while their preference for digital channels has increased.

“As businesses invest in creating a seamless and integrated experience across channels, consumers’ preference for and use of digital channels is expected to accelerate given the impacts of COVID-19,” says Bryan Gillis, executive practice lead of quality solutions and customer analytics at The Northridge Group. “The speed and accessibility of online chat, for example, offers the ability to shift more transactional inquiries to channels that provide businesses with higher productivity and a lower cost to serve.”

The Northridge Group has published its report annually since 2015 and began including survey responses from business leaders in 2018. The combined 2020 study of more than 1,000 U.S. consumers and more than 250 business leaders continues to shed light on the discrepancy between how business leaders and consumers view investment priorities, the consulting firm said. While businesses continue to prioritize investments in channel consistency, consumers would prefer they focus on fast and easy service including:

• increasing speed of issue resolution;

• improving accessibility of service; and

• developing knowledgeable service teams.

View the complete report here.

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