October 2011 | 

Where to Find Deep Customer Insights (At No Cost)

deep customer insights

It looks spectacular: twenty-foot high walls with brightly colored jackets hanging at staggered levels. Born in a merchandising office thousands of miles from the store, the idea wins over the C-suite. But look at that same wall through your customers' eyes. In her new book, Malled: My Unintentional Career in Retail, veteran journalist Caitlin Kelly describes it: "You want [your customers] to feel welcomed, valued and well-cared for. You don't want them to have to point to something hanging six feet above their heads, like a carnival teddy bear, that they can neither touch nor try on without an associate's help."

But the wall wasn't just a source of frustration: it cost the company sales. Kelly, who worked at a North Face store in her local mall for over two years to supplement her freelance writing income, continues, "There was only one hook for the entire store. Factor in the wasted time and physical energy of every associate and manager who had to find the hook, walk it back to the customer, get the clothing down and show it."

In her book, Kelly goes behind the counter to reveal some startling observations about the ways corporate decisions affect sales — and what sales associates know about your customers. "One consistently profitable source of our business," she reports, "was kids' clothing. Yet only about ten percent of our store was devoted to [it]." Kelly notes that were they able to stock more, they would have sold more. She continues, "The clothing was chosen for us as well as how it would be displayed. Regional tastes or differences? Not interested. We would soon be able to tell, within minutes of unpacking, ...what would never, ever sell to our customers."

And yet for the over two years Kelly worked retail, neither she nor any other sales associate was asked what they knew about the customers they served. As closing keynote speaker at the recent Retail Consumer Experience Conference in Minneapolis, Kelly told the audience of international executives how well she and her fellow salespeople understand the shopping experience and have ideas — many of them very simple — for improving it. But "the manager never once asked any of us what we thought might improve sales…. Like a thorn in our side, the irritation of a poorly-organized, annoyingly-merchandised, inexplicable store layout was never discussed. Just because no one at head office ever heard about our frustrations, as exemplified by that one silly hook, didn’t mean there were no problems — just that senior managers had no idea what they were or how, if they were even interested, to resolve them."

Wharton marketing professor Steven Hoch notes that sales associates can be a rich source of market research. "This goes well beyond the 'brand ambassador' role that many retailers assign to their salespeople. Good companies," he notes, "create a simple method for associates to share feedback and make changes. As the people who interact most with customers, they know them best. Their feedback can complement, and in many cases replace, marketing research."

Hoch, who teaches in Wharton's Strategic Marketing Essentials, says, "The use of employees to gain customer insights has a lot of potential. It's guerilla marketing: organic, cheap, informal, and most important, quick. The corporate environment is evolving rapidly. Being willing to change course and adapt based on customer feedback, when that feedback is coming in real time, can give you a significant competitive advantage."

While much of the current marketing literature focuses on getting customer insights to sales associates, Hoch sees the process in reverse. He explains, "Pay attention to the knowledge your associates have about your customers. Too many edicts from on high can backfire — and they don't always take into account what's really happening on the floor. Your associates can not only save you money, but their knowledge can greatly improve your customers' experience."