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Impact of One Bad Review

With everything going on in retail today, when is the last time you thought about the impact of one bad review on your brand?  A review, you say?  I can’t worry about one customer’s experience…or can you?  In this post, I share the connection between a bad review and the future of your brand.  You don’t have to be in retail to be thinking about what your customers are saying about you either.

Retail has been Distracted Lately

We have been watching the daily closure of brands we have known and loved for the past few decades close their doors.  This has resulted in thousands of people being laid off. Then there is the other side of the coin.  Retailers who are doing well and preparing for the fall season.  If you are one of the brand’s in this latter camp, let’s talk about a fresh topic…the impact of a single customer review and the future of your brand.

For the past several months, COVID has required every retailer’s focus to be on safety, as it should be.  This will continue to be an important component for the foreseeable future.  None of us would argue that customers and associates feeling safe is vital to our stores success.  But what about the experience beyond masks and distancing?  Could we agree that there is an opportunity to deliver more?  Is the customer expecting more?  Do they deserve more?  After all, if the in-store experience is blasé, why wouldn’t the customer  stay home and order online?  Why give the customer something to complain about?

What if…

What if every customer who walked into your store was treated like the non-renewable resource that they are?  And what if treating them this way made them want to tell everyone they knew how amazing your brand was? Then what would happen to your sales?  I think we all know the answer to these questions.  So here is the big question…what is stopping us from delivering this experience every day to every customer who walks into our stores?

The List of Things that Matter

Let’s talk about the list of things that impacts whether a customer has a good or bad experience.

Your list may look different from this one…but this is how I think about the things that impact the experience inside the four walls of your store.

  1. Health and Safety (and this won’t change anytime soon)
  2. Supply Chain flowing product
  3. Marketing to Customers & reinforcing your “Why”
  4. Talent
  5. Financial targets that make sense
  6. Customer Experience
  7. Yelp and Google Reviews

Customer Want More

I just got back from shopping with my daughter at a beautiful  lifestyle center in our city and it was very busy.  Everyone was wearing masks and there were lines outside of just about every specialty retail store.  In each store we went into, the focus was on counting the number of people walking in and ringing customers at the register.  That was it.  No brand experience.  It was disappointing.  I believe customers want more.  The time is now to deliver more inside brick and mortar stores if we want to survive.

When is the last time you left your office and visited one of your locations? I encourage you to take a day trip out of your corporate office and do just that.  It is a great way to see what your customer is seeing and then allow that to drive your priorities.

1. Health & Safety

Health and safety protocols are in place and customers feel safe shopping.  Check.  Kudos to the brands out there that are keeping stores clean and safe for their associates and customers.  This is table stakes.  It alone is not enough.

2. Supply Chain is Flowing

Stores are starting to fill in with new goods.  When you are visiting your stores, talk to customers.  I did and do you know what they said?  They want a sense of normalcy back and going shopping gives it to them.  They are expecting to see a full assortment of fun new products.  Nordstrom did a great job getting customers excited about their Anniversary sale, and then when you shopped the early access sales, everything on your wish list was already sold out.  What a disappointment.  Nordstrom slid down the list of brands I am shopping due to this experience.  How are you thinking about the assortment in your brick and mortar locations?

3. Marketing & your Why

Now is such a perfect time to ask yourself, “is my brand’s ‘why’ obvious to our customers?”  I am so impressed with the brands who are clear about their why.  I took the first part of the day to visit Springfield, Ohio today.   My goal was to talk to family business owners about the impact of COVID on their business.  As I went from business to business, I heard about the incredible lift they had from COVID.  When I asked them what they thought caused the increase in business, they all said the same thing.  Customers needed what they were offering.  There was a  consistent theme with each of these business owners.  They were talking to customers, listening and understanding what they want and then gave it to them.  Impressive? Yes.

Don’t get me wrong, this success isn’t coming easy.  These small business owners are working long hours to meet their customers needs, and ensure they are following all the guidelines at the same time.  But it wasn’t a total focus on safety, they already knew those were table stakes.    They cared about each customer who walked through their door.  I watched it first hand.  They made it look easy and I was amazed.  Why are they experiencing such success?   Honestly, customers are disappointed with mall stores.  They are looking to small retailers in their community who know them and live side by side with them to help them get through this abnormal time.

One retailer did more volume during the month of April this year than cumulatively all of 2019.  How did he respond to this business?  He saw what was selling and started getting more of it in.  Expanded his offering, hiring more people and is delivering exactly what his customer wants.  Rocket science.  Nope.  But these small businesses are nimble and quick.  They don’t over complicate it.  Their customer matters more than anything else.  What could mall retailers learn from these small businesses?

4. Talent

The market is flooded with incredible talent who were casualties of the recent retail bankruptcies.  What a great opportunity to upgrade the talent in your organization and to establish even higher standards.  There is no reason to tolerate poor performers or to be short staffed.  It wasn’t that long ago when finding talent was like finding a needle in a haystack.  Fill your stores with associates  who have a heart for the customer and is dedicated to creating memorable experiences.  How are you evaluating your current teams?

5. Financial Targets that Make Sense

For many retailers, comparing this year’s sales to last year or to a sales projection that was created pre-COVID is pretty irrelevant.  Some retailers sales are up due to revenge spending, while others are down due to low traffic and the disrupted supply chain. Yesterday’s KPIs may not make sense today.  Conversion is controlled by the metering of traffic from social distancing requirements.  So is it even a reliable number?   In an industry where store managers evaluate their success on their sales performance, it is important to ensure that you are measuring the right metrics and your teams are finding wins.  Are 5 star reviews the new metric that matters?

6. Customer Experience

How are you preparing your teams to deliver more than safety protocols?  Safety is key, there is no doubt and so is the customer experience.  I have personally been disappointed by the experience in specialty stores recently.  Between low inventory levels and an all consuming focus on COVID, I haven’t felt the brand love.

Small businesses are rocking it because they are doing what they do best.  Delivering fun and personal experiences.  How do we bring this focus back to specialty retail chain stores? Are your associates so focused on the rules that they no longer create compelling brand experiences?  The amount of payroll being spent will have an impact on the customer experience.  How are you ensuring you have the right people, scheduled at the right time with the right skills?  Most brands are open 7 days a week, 8 hours a day.  If the labor model isn’t right, what is the impact of an unhappy customer each day or each hour of each day in each location?  It adds up and they will find a competitors store to shop in.

7. Yelp and Google Reviews

Each of the components we have talked about above rolls up into the customers experience in your business.  What do you think the impact is of one bad review?

When  is the last time you checked out your brands reviews on Google or Yelp?  Good reviews drive customers into your store.  Bad reviews drive them to your competitors.  Even if the customer isn’t leaving a bad review on Yelp or Google, what are they saying to their friends about your brand?  About their recent experience?

Teaching your store teams the impact of one bad review is a necessary part of their education.  Are your managers recognizing team members who get a 5 start review?  As a company, are you recognizing teams who are creating raving fans with every engagement?

For those of you who need statistics to validate this perspective, there is an article in this months HBR.  Statistics show that seeing a negative review “decreased the purchase probability by 51% on average, and raised the chances that the consumer would search for a substitute by 11%.  Consumers who found and bought a substitute spent 16% more for it, suggesting that people will pay a premium to avoid the uncertainty triggered by a bad review.” (SOURCE: Measuring the Impact of a Single Negative Customer Review on Online Search and Purchase Decisions” by Marton Varga and Paulo Albuquerque (working paper).

The researchers continue to say “companies might want to focus less on cultivating a forest of great reviews and more on the site of each tree the customer may see.  Managers would do well to redouble their efforts to please customers who register their displeasure and only then ever so politely request that the complainant revise his or her review.”

Your Turn

This post is meant to challenge how we are thinking about our brick and mortar stores.  We cannot continue to see stores around us succumb to bankruptcy.  We must fight back and provide customers with compelling experiences.  I am reminded of two truths…

  1.  When we focus on the right things, we get good results.  If we focus on the wrong things, we get worse results.
  2. Customer reviews matter.  Whether or not they leave them on Yelp or Google, they are still telling other people about the experience in your brand.

Can any of our retail brands afford one bad review?

Running Great Stores is helping brands evaluate their in-store experience and make the necessary changes to move the brand forward and give their customers what they want. Contact us at rachel@runninggreatstores.com for more information.

Rachel

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