Reducing customer effort is critical in earning customers relationships
How easy is it for customers do business with us? How much effort is required for customers to find what they want, and have it provided where they want? Many retailers rarely ask these “effort” questions. Yet, they are at the very core of the Goliath’s strategy that is gobbling up customers at an amazing rate. So much of retail still focuses on a heritage of the 4Ps to market sales transactions. With all of today’s options of where to purchase, customers are now looking for seamless, easy experiences. Increasingly, the “effort” required on the part of the customer is as important as product and price. The rest of retail can compete with Amazon if they focus on reducing customer effort required before, during, and after the sale.
Why this is important: A product centric heritage has perpetuated a focus on purchases. Winning is no longer just about the sale today, but how to reduce the overall customer effort and making it easy to do business across time and place.
Different horses for different courses – The race for lifetime value
There is an old maxim in horse racing – you need different kinds of horses to win different races. Some horse breeds excel at speed over short courses of a mile or less. However, those thoroughbreds do not win steeplechase races requiring endurance and jumping over obstacles. In the current age of retail disruption, what is the nature of the race, and what it will take to win? Will it be increasingly about speed of delivery? Those horses have already left the barn and are racing down the last mile. There is another race that is more subtle, and even more critical for long-term survival.
Amazon’s goal from day one has focused on making it easier by helping you buy stuff with less effort. From one click ordering, customer profiles, saved lists, subscriptions, to automatic order tracking – Amazon takes the pain and friction out of the end-to-end process. They even charge you for the privilege of becoming a Prime member, because they know if they can significantly reduce your effort, they earn more of your business over time across their ecosystem. Amazon is literally at the forefront of reducing customer effort in research, shopping, purchases, repurchases, and even returns.
Simple, frictionless experiences win loyalty and customer relationships
One of my photography gadgets went dead, and I needed a battery that was not one of the typical sizes. I remembered buying one at a local retailer, but I could not find anything on their website. So, I called the local store and asked if I could buy the same battery I purchased from them last time. They could not find any record of me or my purchase in their files. I read the information from the dead battery to the person on the phone. They said they no longer carried that brand of battery, and were not sure if they had anything compatible.
I hung up and went online to find the exact battery on Amazon in less than 15 seconds. I clicked once to order. My home address appeared automatically as the shipping address. I clicked once to choose a previously used credit card. I immediately received an email with a tracking number and the battery arrived the next day at my doorstep. Even more importantly, the next time it will be even easier to bypass the specialty retailer because Amazon saves ALL of my orders. If they do not carry the exact same battery, Amazon will recommend alternatives that meet the specs AND provide customer feedback on those products. Less effort wins future sales!
All retailers are capable of reducing customer effort to win relationships
Winning customers for life requires a different mindset than making a sale today. It requires a consistent, conscious effort to make everything simple, fast and convenient from the perspective of the customer. EVERY retailer has the capacity to reduce customer effort and make it easier to do business across a wider relationship. There are literally countless ways to take “the friction out” and make it easier for the customer. Here are just a few:
- Know me. Take the time to learn my name if I frequent your store. If I have been on your site, welcome me back.
- Remember Me. If we have done business before, do not make me give you all of my information over again.
- Give me options and make them easy. Make options for purchase easy and available everywhere. Let me buy on my phone, in store, and online by click and collect.
- Make click and collect work for me (not you). Make click and collect easy to find, fast and efficient. Do not bog me down with unnecessary details and add-ons.
- Help me get what I NEED. If you do not have it in stock, that’s understandable, but help me get what I need, not a poor substitute you have on hand.
- Offer me value! Offer me options and services that enhance my purchase and use, not things that give you fat margins.
- Returns are essential. Legitimate returns are necessary. Help make the process easy, efficient, and not demeaning.
- Follow me home. Yes, you will need my permission, but I appreciate follow up after I am “sold”, and even welcome legitimate offers of how to make things work better.
- Surprise me. Make your experience interesting and fun. Surprise me with the unexpected and personalized service that sets you apart from all the rest.
- Thank me. I vote with my wallet. You earn my business by making things simpler and appreciating me as a customer.
Winners will focus on reducing customer effort to build relationships
Amazon is not “stealing” traditional retailer’s business. They are running an entirely different race of “taking the pain and effort out” to win long-term, profitable relationships. Amazon and Walmart are winning across channels, because they differentiate their experience in ways that customers expend less effort to receive greater value.
This is not about whether physical stores will die. They won’t. This is also not about retailers expending more efforts and “trying harder”. More of the same will get more of the same. Riding the same horse that won on the 4Ps will not win the race to win lasting customer relationships creating lifetime value.