From labor shortages to supply chain disruptions, retailers are up against significant challenges that are disrupting the industry as a whole and shaking up overall measures of both customer and employee satisfaction.
In fact, over the last 18 months, retailers have experienced a 17-point decline in customer satisfaction (CSAT) related to product availability and a 14-point drop in CSAT related to employee assistance, according to a Medallia Insights study of more than 85 global retailers.
At the same time, the average number of brands customers purchase from has seen noticeable gains. In 2019, the average shopper purchased from six different brands. By 2020, that number grew to 10 and, in 2021, the average was just shy of 13 brands, according to the same Medallia Insights research.
One of the key drivers of not only winning the business of these new customers — so-called brand explorers — but retaining them and accelerating them into brand loyalists? Forging emotional connections between customers and brands.
By and large, customers’ sense of emotional connectedness to a brand is a direct result of interactions with retail employees, and employees need to feel that same level of emotional connection to their employer to deliver this kind of connectedness.
Unfortunately, over the last year and a half, overall internal employee satisfaction with employers, as measured during the first six months of employment, has dropped by a staggering 44 points, according to a Medallia Insights study of 14 leading global retailers.
Employees will continue to resign at a record pace until they find a brand where their morals and values align, they feel that same level of emotional connectedness and they feel supported throughout their entire employee journey. Only then will they deliver for that brand.
That’s why it’s time for brands to prioritize employees, by listening to every employee across the employee journey, optimizing the end-to-end employee experience and taking the right action to motivate, inspire and empower workers across the entire organization. After all, without an engaged workforce, the retail customer experience will continue to suffer.
Employee Experience + Customer Experience = Brand Experience
Right at this very moment, major retail brands are investing in brand innovation and transformation, redefining who they are and what their brands represent. However, many businesses struggle to overcome an experience gap that emerges between what marketing says the brand experience should be and what customers say their experience actually is.
Within the retail industry in particular, frontline associates are truly responsible for the brand experience. If employees do not feel connected to an organization’s mission and values, companies will fail to deliver.
The problem is, there’s another gap at play — a gap that both HR and management need to address.
Many leaders continue to look backwards at what has happened, using annual engagement or quarterly pulse surveys that only provide one static snapshot of the employee experience. To keep up with shifting employee behavior, preferences, engagement and experiences in real time while also meeting evolving customer experiences, people leaders need to adopt agile employee listening programs that are focused on understanding the overall employee journey and experience in real time.
Ultimately, employee experience is a key advantage that could be the difference between remaining viable in the market and losing out to the competition. According to a Medallia analysis of 11 global retail brands’ employee experience programs conducted in 2021, there’s a strong correlation between strong employee Net Promoter Score and sales. We found a $74 difference between the average order total between promoters ($137.11) — employees who are willing to recommend their brand as an employer of choice — and extreme detractors ($63.06).
Driving employee engagement must be the focal point of understanding and improving overall brand experiences, and, within the context of the Great Resignation — employees finally having the upper hand when it comes to employment — that’s going to be even harder.
At the C-level, operational leaders have recognized that to become an employer and brand of choice for frontline workers and customers while enabling a positive impact on the financial bottom line, they must be willing to transform, and act now.
As the concept of CX has evolved over the past 20 years, we now know we must understand and optimize every stage of the customer journey.
That’s what we need now: True experience leaders who can do the same with the employee journey — from the time a candidate applies for a job within an organization until they offboard.
We’re at the forefront of a new era, and some executives are already leading the way by creating a new role of Chief Experience Officer, to head up the transformation and identify and address points of friction along the employee journey. Now is the time to engage and act.
Jodi Searl, JD, PhD, is VP for Industry Solutions and Global Solutions Principal for Powersports and Recreation at Medallia. Searl brings a wealth of industry experience to her role where she specializes in the complex powersports and recreation vertical for all OEM brands and manufacturing with an OE to dealer to customer business model. Prior to joining Medallia, she was the Head of Global Dealer Training for the Harley-Davidson Motor Company, where she led the operationalization of customer experience for the global dealer network. A lifelong motorcycle rider and outdoor enthusiast, Searl is a passionate consumer who loves working with clients to build a customer-centric strategy that delivers business results.