Challenges of CRM in a Retail Environment

I do the bulk (~98%) of my grocery shopping at the Whole Foods near me. And, because I'm one of those people who shops for 1-2 days at a time, I'm in Whole Foods nearly every day. I'm on a first-name basis with the security guard, Dave, who works there. He even noticed and commented on my new haircut the other day.

You would think, with the frequency that I'm in Whole Foods (and, quite frankly, the amount of money that I spend there!), that somehow, Whole Foods would recognize me as a valuable customer and treat me as such. At the very least, the cashiers and floor workers would recognize me - if not by name, at least by face - and welcome me back. Dave does, but I'm sure part of that is because it's his job to look at customers and make sure that they're not stealing something. But none of the other Whole Foods employees do. And, surprisingly, Whole Foods does nothing with the reams of data they capture about my purchase preferences.

Implementing CRM in a retail environment can be difficult, if not downright impossible. Employees are typically more junior, and turnover may be high. Continuation of the "customer conversation" is difficult, since different employees may be servicing the same customer at different times. Many times, employees do not have the means to capture customer preferences and requirements. And, finally, until the customer checks out (and presents his or her credit card), employees typically won't even know the customer's name - let alone the value that customer may provide.

Some retailers do a great job at this. Mitchells of Westport (www.mitchellstores.com) is probably one of the top CRM retailers out there. The store uses their customer database to target communications and sales, record customers' sizes and preferences, and track each customer's personal details - going beyond just the customer name and address to also include the customer's spouse's and children's details, and even pet names. Every interaction is tracked in the database. Mitchells' sales people are trained to leverage data to build relationships with customers. They don't stop there, though: Mitchell's also works to make sure that the customer experience is beyond expectation. If it means that the sales person has to deliver a purchase to the customer's office in New York City or meet the customer at the airport so that the customer has a suit needed for a business meeting the next morning, they do it. Mitchells has made CRM and CEM an integral part of their culture and employees are expected to exceed customer expectations. They have, in fact, systematized it and ensure a consistent experience for their customers.

I had mentioned in another blog about White House/Black Market and the CRM/CEM activities they have done for me personally (http://one-to-onecustomerstrategy.blogspot.com/2010/06/building-trust-with-customers-even-when.html). They also have a customer database where they can track purchases and even promotions that I'm eligible for so that I don't have to remember. However, while my experience has been great at the San Francisco store, I have not had the best of experiences at other stores. I think that part of the reason why I have such a great experience locally is because of the one sales person who intuitively looks to build customer relationships.

So, what's a retailer to do?

Well, here are a couple suggestions based on my experiences with Whole Foods:

1. Focus first on creating a great customer experience rather than a customer relationship.
2. Begin by training employees to truly look at customers and learn to recognize returning customers. If the retailer can think of a way to get returning customers to self-identify as they walk into the store, even better.
3. Set standard guidelines and "rules" for a baseline customer experience that every employee needs to deliver. Right now, my experiences at Whole Foods can be hit or miss. Some cashiers are very friendly, ask me if I found everything okay, and whether I want to donate my bag credit or get the refund. Other cashiers are too busy talking with other employees to even greet me. This problem isn't just at Whole Foods. Retailers should have clear guidelines on how to treat the customer and rules about what is and isn't appropriate when interacting with a customer. (My personal pet peeve is when an employee is on his/her cell phone talking with someone while checking me out.)
4. Figure out how to capture customer data and begin using it. Many retailers have loyalty cards which can be a starting point. Whole Foods does not, but they could still use all the sales transaction data they capture. Most consumers only use 1-2 credit cards or debit cards to pay for purchases; it would be fairly easy for Whole Foods to begin by aggregating data at the customer level and looking for trends in purchase behaviors at the customer level.
5. Empower employees to be able to resolve issues and make decisions without having to ask a manager all the time. Set guidelines for this, train the employees, and then let them take ownership of any problems.

Any other ideas?