Explore the secret of customer satisfaction

2022-07-27
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Explore the secret of customer satisfaction

this article takes a similar academic question as the opening remarks. Researchers know that in the aviation industry, customers and employees like Southwest Airlines; In the computer field, Dell has achieved the greatest customer satisfaction. Toyota tries to maintain an unbeaten competitive position in the automotive industry. However, when Toyota has to face the retail market, what standards should the company set for customer and employee satisfaction

serguei netessine, Professor of operation and information management at Wharton Business School, said, "in any other industry, you can say what the company is best at." However, in the retail industry, no company has occupied an obvious leading position, that is, Toyota does not occupy a dominant position in the retail industry

netessine, Marshall Fisher, jayath Krishnan and Daniel Corsten launched two closely related research projects to try to analyze what factors led to success in the retail industry with scattered markets from the perspective of revenue and long-term growth. Fisher is dean of service and operations management at the Fisher Davidson center at Wharton Business School. Krishnan is a doctoral student at the Wharton School of business, and Corsten is the associate dean of the Kuehne School of logistics at St. Gallen University in Switzerland

their initial conclusion was that the factors driving success reflected the motto long believed in by the service industry; However, only recently, they began to consider the appropriate factors leading to the success of the retail industry, that is, customer satisfaction; This finding is no longer surprising. When four experts in operation tried to point out clearly what factors improved the performance of suppliers and helped shoppers treat retailers differently, some unexpected results emerged. Until now, the process they feel has received little attention from the academic community. Their conclusion is:

l when buyers find that the product they want to buy is on the shelf, customer satisfaction is determined by the availability of inventory. Netessine said, "this seems trivial, but the availability of products - in stock or out of stock, is much more complex than initially expected. Customers' feelings about product out of stock are very different from retailers' own estimates."

l when the shortage problem needs to be solved, the less the problem, the better. In other words, the traditional view that more inventory will lead to less possibility of inventory shortage is incorrect. Inventory seems to be a difficult problem to deal with; When there is too much inventory, it will lead to too much inventory backlog; Because employees can not find products, or in the process of re arranging shelves, employees often place products in improper positions, which will lead to stock shortage. Interestingly, the longer the store manager works in the store, the higher the shortage rate. If the price of high and low temperature test boxes can continue to increase, the enterprise can get twice the result with half the effort in the market competition

l customer satisfaction reflects that the store has an employee who knows the store and its products well, and these employees are able to pass on the product information and their understanding of the product to customers. This sounds simple. Wharton Business School experts point out that in the retailer industry, employees' salaries are generally very low. Therefore, it is very difficult to maintain and motivate knowledge-based employees. One way to deal with this problem is to develop a "fool type" policy, which is easy to explain and implement to knowledge-based employees

l customer satisfaction not only strengthens the retention of customers and increases the purchase volume, but also attracts more new customers through customer oral publicity. Maintaining existing customers and expanding new customers greatly improve the financial performance of retailers. Finally, as in many service industries, it is also very important to measure customer satisfaction through formal surveys in retail business

considering that a previous study of Wharton Business School was about computer manufacturers linking customer satisfaction scores with reviews of a range of products; Fisher said, "it seems that there is an acceptable performance threshold. As long as you are on it, whether you are good or excellent is not very important; in either case, as long as your customers are satisfied, it is enough."

at the same time, Fisher also admitted that it is always difficult to find the optimal level of performance for every retail industry. He added, "basically, how do you know what the threshold is? You need to link the value of customer satisfaction with the business conclusion and customers you are interested in. For example, in the study of a large telecom company, it is found that even when customer satisfaction continues to rise, the ratio is always kept at 75%. Therefore, you should regard customer satisfaction as a threshold."

employee: a combination of income center and cost center

in order to investigate what drives customer satisfaction, the four experts adopted two different but complementary methods. Fisher, netessine and Krishnan worked with large retailers to study store operation policies that drive store execution, customer experience and financial performance

research on store operation policies focuses on employees, building space, inventory backup space, the number of product patterns, the tenure of managers, the stability and training of employees. The execution research of stores focuses on: the inventory in stock, the inventory out of stock and the accuracy of inventory records (Fisher said, "you can't improve things that can't be measured accurately"), as well as the placement of friendly customer interfaces, the integration of additional services with accurate labels and prices. The customer experience will include: the value of a beneficial and good employee, a well-organized store, and a dispute free inspection. However, the main concern is a simple question: have customers found the products they need to show clearly

krishnan said, "there is an unknown saying - retail is the details". He recently spent several days working with a large machinery chain store to collect information about customer satisfaction. He said, "What information makes a greater contribution to income? What information makes a greater contribution to cost? In this machinery chain store, the income is more from the right things done by employees with little salary. Employees are both the income center and the cost center. There was a long-standing joke that store thieves are more likely to be employees than customers. The moral level of employees has an impact on the income of the store."

in another separate but parallel study, Corsten and retailers focus on out of stock products and how they affect the buyer's experience. Corsten said, "intuitively, you would think that shortage will have a bad impact on customer satisfaction. However, the survey results from more than 12 types of products show that when faced with shortage, almost half of customers will choose other alternative brands or other sizes of the same brand, and only 1/3 of customers will choose to return empty handed."

citing earlier studies, Corsten pointed out that the average shortage level of retail stores is 8.3%, which is a very high number. Corsten pointed out in the 2002 report of grocery manufacturer in the United States that "by increasing the stock out, retailers can increase the earnings per share to 5%."

corsten said that the reason for the shortage is not the failure of supply chain management, purchase or external distribution, but the store itself - wrong prediction, missing or wrong placement of inventory, poor shelf placement, or storage system, insufficient or wrong inventory measurement methods

he said, "When the product cost is equal to that of cast aluminum alloy, when we carefully consider the reasons for the shortage, we understand that 72% of the reasons come from the store itself. Therefore, it did not take a long time for us to understand that the problem should be solved from the store itself. At the same time, we should pay attention to all management types - distribution management system, international expansion, and the participation of online retail - it seems that some retailers They didn't do very well within their own management. It is surprising that retail has been the world's first for so long, but its performance has been so poor. You may be thinking about why this issue has not been taken seriously before. This is why we are currently working with retailers to study how to substantially reduce the continuity of out of stock. "

find "vulnerabilities"

through group research, fisher made some interesting findings about how companies review inventory for out of stock. For example, a large consumer electronics retailer hired an outside company to look for "loopholes" and supervise any out of stock bar codes. The results of the study were surprising. Fisher said, "in 30% of the time, the computer system will report that the system has inventory, but in fact, the store can not find these inventory. Obviously, this is a problem in store implementation."

how does shortage affect customers? After reviewing the research on more than 71000 customers in more than 20 countries around the world, Corsten came up with five possible impacts: customers buy in other stores (store choice changes); Delayed purchase (purchase later in the same store); Choose other brands as alternatives; Or not to buy (loss of sales). Customers can tolerate a certain degree of out of stock, but their tolerance depends on the urgency of their demand for products and the dependence of customers on a particular brand

as Corsten wrote: "when the opportunity cost of the product cannot be consumed immediately is very high (for example, when there is a shortage of diapers), customers will choose alternative products or go to other stores to buy; at the same time, when the opportunity cost is very low, it will lead to delay or cancellation of purchase; when the cost of adopting an unpopular alternative brand is high (e.g. women's hygiene products or washing products), the customer will take any measures other than substituting another brand; When the transaction cost is very high, for example, time, delay or efforts to purchase elsewhere, the customer will choose a substitute or cancel the purchase. This view shows that customers are more inclined to choose transfer in some cases. "

interestingly, when it is associated with inventory shortage, customer satisfaction is obviously related to geographical factors. Corsten found that when the brand they want is out of stock, 50% of European customers tend to choose a competitive brand, but they rarely choose to buy in other stores; At the same time, American customers prefer to choose a product with different packaging sizes or patterns within the brands they prefer. However, if the products they like are out of stock for 2 to 3 times in a row, American customers are more inclined to choose other stores than European customers

netessine believes that the challenge of investigating the factors driving customer satisfaction comes from the need to combine the two processes at the same time. He said, "in the service industry, you must pay attention to customers; in the manufacturing industry, you must pay attention to the smoothness of the production process.

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