Beyond transactions building a compelling retail experience

Beyond transactions
Building a compelling retail experience
An Economist Intelligence Unit white paper
Sponsored by SAP


Beyond transactions
Building a compelling retail experience

Preface

Beyond transactions: Building a compelling retail experience is an Economist Intelligence Unit report
sponsored by SAP. The Economist Intelligence Unit bears sole responsibility for this report. The
Economist Intelligence Unit’s editorial team conducted the interviews and wrote the report. The findings
and views expressed in this report do not necessarily reflect the views of the sponsor. Dan Armstrong was
the editor of the report and Sylvia Helm as the author. Mike Kenny was responsible for layout and design.
Our thanks are due to all of the executives who responded to the survey.
October 2009

1

© Economist Intelligence Unit Limited 2009


Beyond transactions
Building a compelling retail experience

Contents

2

Introduction

3

Key findings

4

Conclusion

7

Appendix 1: Overall survey results

8

Appendix 2: Americas survey results

13

Appendix 3: Asia-Pacific survey results

18

Appendix 4: Europe Middle East and Africa survey results

23

© Economist Intelligence Unit Limited 2009

Beyond transactions
Building a compelling retail experience

Introduction

Global recession, the accompanying fall in demand and the proliferation of shopping choices have
combined in the last year to make retailing a tough business in which to succeed. Shoppers can buy the
same goods from any number of interchangeable sources, including competing chains and multiple web
commerce sites. They can use their mobile phones to scan bar codes and instantly obtain a list of stores
and website where the product is available and how much it costs at each. They can reject a retailer for any
number of reasons: a price that may be only pennies higher than competitors, the level of convenience,
the friendliness of the sales staff, even the store’s décor. When products are delivered to the door at a low
price with a click of the mouse, there is no reason to even leave the house.
To differentiate in this environment, retailers need to provide something special—something informed
by the qualities that the customer values. If it is not price, the key is customer experience. Regardless
of channel, the retailer needs to provide a consistently enjoyable and convenient shopping experience,
ensuring that everything—from the feel of the store or website to the return and exchange policy and the
promotions extended to the customer—is carefully matched with the traits that the customer values.
In this difficult economy, retailers would be well-advised to focus on the elements within their control,
especially building customer loyalty among the most valuable customers who account for the bulk of the
revenues and profits. Getting these customers to keep coming back requires gathering information from
customer transactions, sharing that information across customer-facing units, and ultimately measuring
and taking actions based on the value of each customer.

About the survey
In September 2009, the Economist Intelligence Unit
surveyed 89 executives of retail organisations on the
challenges of getting customer-facing departments
to work together more consistently and effectively.

3

Survey respondents spanned the globe, with 34% from
the Asia-Pacific region, 32% from the Americas and
34% from EMEA. Respondents’ annual revenue ranged
from less than US$500m to more than US$10bn. The
level of seniority of respondents was high: 31% were
C-level or board members and another 17% were VPs or
heads of business units.
© Economist Intelligence Unit Limited 2009


Beyond transactions
Building a compelling retail experience

Key findings

Estimating customer lifetime value
Most retail organisations in the survey consider customer loyalty their strong suit. Despite the recession,
65% say they have greatly strengthened customer relationships over the past 12 months. What they have
not done is figure out a way to measure the lifetime value of their customers and use that information
to prioritise their sales and marketing efforts. Regardless of industry or region, very few executives can
honestly say that their companies can quantify the value of their best customers—or any customers, for
that matter.
Measuring the value of customers
(% of respondents who agree minus % who disagree)
Disagree

Agree

Despite the recession, my organisation has
greatly strengthened customer
relationships over the past 12 months
My organisation has an accurate way to
estimate the lifetime value of customers
My organisation has an accurate way to
estimate the lifetime value of customers

-30

-20

-10

0

10

20

30

40

50

Source: Economist Intelligence Unit survey, September 2009.

Targeting the customers
As to which customer-related areas need to be improved the most, the number-one response is targeting

the right customer to meet sales goals. Retailers point to segmenting and profiling shoppers, reducing the
cost of sales and cross-selling or upselling shoppers as areas in need of improvement. They also mention
enhancing their ability to drill down to the individual sales level to understand what each customer
is likely to buy, estimate how much revenue will be produced, and what to promote or cross sell each
4

© Economist Intelligence Unit Limited 2009


Beyond transactions
Building a compelling retail experience

customer. To do this, retailers have moved beyond traditional demographic criteria to frequency and size
of purchases, lifestyle information and the last product bought.
For instance, the US women’s clothing retailer Coldwater Creek—which sells through retail stores, a
web site and direct-mail catalogs—recently announced the launch of the “Onecreek” loyalty program
aimed at the top 5% of the company’s active customers. It offers early peeks at new merchandise, a
personal shopper, free shipping on returns and a gift on the customer’s birthday. Eligible customers are
those who purchase three times as frequently and spend four times as much as an average customer. “The
program is designed to improve retention and overall spend within this very important and profitable
segment of our customer base,” said Dennis Pence, the company’s CEO, in a press release.

Targeting resources
Survey respondents say big benefits can be gained from integrating marketing, sales and service
activities. If all customer-facing service units share the results of every customer interaction, they
should receive a detailed picture of shopper behavior from all angles. Then resources could be prioritised
based on total value of each customer over the life of the relationship. Many companies, including Sony
Ericsson, Bell Canada, Samsung, Apple and Amazon have distinct customer service numbers for so-called
“executive” customers—those whose spending surpasses a certain level, whether for their companies
or on their own behalf. These customer service agents have information on each customer at the touch

of a button, and are empowered to offer discounts and provide extras on depending on the value of the
relationship.
Top three benefits from integrating marketing, sales and service activities?
(% respondents)

Developing and sharing a detailed picture of shopper behavior and preferences

Making each unit aware of how the others have interacted with a given shopper

Prioritising resources directed towards shoppers by total value over the life of the relationship

0

5

10

15

20

25

30

35

40

Source: Economist Intelligence Unit survey, September 2009.

5

© Economist Intelligence Unit Limited 2009


Beyond transactions
Building a compelling retail experience

How the three regions differ
The three regions surveyed—the Americas, Asia-Pacific and EMEA –all give themselves top marks for
excellent customer service. All pride themselves on the loyalty of their customers. And all admit that
their organisations cannot accurately measure the value of—or even identify, in many cases—their most
profitable customers. The challenges faced in each region include the following.
Americas Reducing the cost of sales—necessary to keep margins low and prices competitive—is a top
priority for Americas retail organisations. In the Americas, customer feedback tends to be filtered through
the less expensive e-commerce channels, rather than from direct response feedback (as is the case in the
two other regions).
Asia-Pacific Asia-Pacific retail organisations get most of their customer feedback in stores, through retail
sales staff, and at the point of sale. They are the lowest users of e-commerce, and call centers are used by
only 17% of respondents.
EMEA Of all regions surveyed, EMEA retail organisations are the least able to gauge the lifetime value
of customers. Most in need of improvement: profiling, targeting, and cross selling or up selling existing
customers. EMEA retailers use call centers the least and direct response (direct mail, e-mail) the most.

6

© Economist Intelligence Unit Limited 2009

Beyond transactions
Building a compelling retail experience

Conclusion

Few survey respondents say they can accurately measure the value of customers. Faced with challenges
they cannot control—global economic trends, rapid shifts in product demand, commoditization of the
retail channel—they have to focus on what they can control, working to understand the customer and
provide a pleasant and convenient retail experience. Retailer organisations should consider how to:
l Do a better job of analysing the customer base and measuring the value of individual customers.
l Share and act on customer information in all customer-facing units, making sure to improve the weak
links.
l Differentiate customers by products purchased, services used and revenues generated.
l Provide distinct service to high-value customers, building their trust, increasing their loyalty, and
generating more revenues.

7

© Economist Intelligence Unit Limited 2009


Appendix 1
Overall survey results

Beyond transactions
Building a compelling retail experience

Appendix: Overall survey results

In your view, which of the following best represents the core strength of your overall business? Select only one.

(% respondents)

Customer service: Providing superior service to customers

65

Operational excellence: Creating highly efficient processes

15

Product innovation: First to market with groundbreaking new products or services

12

Other

8

Each of the organisation’s customer-facing departments influences the shopper via different channels. For each of the processes
below, how closely do your marketing, sales and customer service units work together? Please rate on a scale of 1 to 5.
(% respondents)
1. No coordination;
units are completely
separate

2. Ad hoc coordination;
not systematic
or consistent

3. Some procedures

established, but not
consistently followed

4. Procedures
established, regular
interaction

5. Broad, systematic and
consistent integration of
information and strategies

Don’t know

Planning promotions/campaigns
6

8

26

30

27

3

36

27

3

Executing promotions/campaigns
5

9

19

Measuring effectiveness of promotions/campaigns
6

16

20

40

16 2

Developing and launching new products
2

16

21

34

21

6

8

6

Analysing and segmenting shoppers
5

23

26

33

Gauging shopper satisfaction
3

22

25

33

16 1

Responding to shopper demands or complaints
1

9

28

40

20 1

Incorporating shopper feedback into products/services
7

11

30

39

11 1

Other
9

8

9

3

13

66

Economist Intelligence Unit 2009


Appendix 1
Overall survey results

Beyond transactions
Building a compelling retail experience

Do you agree or disagree with the following statements?
(% respondents)
Agree

Disagree

Don’t know

In chosing to do business with my organisation, price is the single most important factor most shoppers consider
27

70

3

Compared to our competitors, my organisation’s shoppers are more loyal
64

20

16

My organisation has an accurate way to estimate the lifetime value of customers
34

49

17

My organisation prioritises sales and marketing resources based on each customer’s lifetime value
34

52

14

We are currently developing a social media strategy
36

41

23

My organisation has more flexibility than its competitors in pricing its products
60

31

9

Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months
65

25

10

We are more engaged in developing products or services collaboratively with customers than we were 12 months ago
52

40

8

Shoppers view my organisation’s products and services more as commodities now than five years ago
51

30

19

Our margins are higher than the margins of most of our competitors
40

46

13

If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles

76

In your view, which of your organisation’s activities are most
in need of improvement? Select up to four.
(% respondents)

17

7

Which of the following would provide the biggest benefits in
integrating your organisation’s marketing, sales and service
activities? Select up to three.
(% respondents)

Targeting the right shoppers to achieve sales volume and revenue objectives
43

Segmenting and profiling shoppers

Developing and sharing a detailed picture of shopper
behavior and preferences
40

34

Reducing the cost of sales
34

31

Cross-selling or upselling shoppers
33

Measuring/optimising effectiveness of marketing and promotional campaigns
28

Maximising repeat purchases and building loyalty among shoppers
28

Gathering shopper intelligence in the course of providing service
27

Measuring the satisfaction of shoppers
26

Generating promotions/campaigns
18

Involving shoppers in product/service development (eg, co-creation)
18

Building long-term relationships with store management
13

Ensuring that shopper complaints are resolved quickly
10

Creating effective collateral
8

Other
0

Don’t know

Making each unit aware of how the others have
interacted with a given shopper
Prioritising resources directed towards shoppers by total
value over the life of the relationship
30

Measuring the probability that shoppers will turn into buyers,
and using these scores to guide sales
27

Establishing common definitions, assumptions and data
26

Helping each function find and act on ways to support the others
25

Integrating tracking of shoppers from initial contact
through to post-sales service
22

Presenting shoppers with a consistent picture of the organisation
20

Our company sees no need to integrate our marketing,

sales and service activities
4

Other
0

Don’t know/Not applicable
4

0

9

Economist Intelligence Unit 2009


Appendix 1
Overall survey results

Beyond transactions
Building a compelling retail experience

Which of the following trends have had the greatest impact on
your business over the past 12 months? Select up to three.

In which of the following ways does your organisation
empower shoppers? Select all that apply.

(% respondents)

(% respondents)

Global economic downturn
71

Offering additional value along with products (eg, in-store service,
merchandising improvements, sustainable packaging)
52

Changing needs of shoppers
Improving usability, search and navigation of shopper-facing websites

40

44

Significant demand shifts for our products/services

Creating educational forums for shoppers (eg, online content,
in-store content, communities of interest, direct-to-consumer outreach)

28

Emergence of new competitors

38

27

Building or supporting online communities of shoppers

Finding access to credit/capital

27

17

Other

Emergence of new markets for our products and services

2

15

Don't know

Focusing on sustainability efforts

9

13

Disruptive technology developments
10

Accessing key components or resources through our supply chain

What avenues of customer feedback is your organisation best
and worst at collecting and using to improve the experience of

shoppers?
Select up to three from each column.

9

Changing needs of store management
9

Other

(% respondents)

0

We are best at collecting and using
We are worst at collecting and using

Don’t know
0

Point of sale feedback
49
20

In which of the following ways does your organisation
empower store management? Select all that apply.

In-store sales staff

(% respondents)

Our own e-commerce site(s)

47
17
27

Improving online or self-service support tools for store managers

29
31

Making prices and sales terms more transparent for easy
comparability by store management

Third-party e-commerce sites
10
30

28

Phone order interaction
24

Improving usability, search and navigation of store-facing websites
27

Investing in self-service tools for store employees across
multiple channels (web, mobile devices, e-mail)

15

Direct response feedback
34

27

Building or supporting online communities

4

Call center customer service interactions
21
19

20

Targeted focus groups

Other

22
21

3

Don’t know/Not applicable
26

Online social media efforts

2
35

Other
1
1

Don’t know
6
11

10

Economist Intelligence Unit 2009


Appendix 1
Overall survey results

Beyond transactions
Building a compelling retail experience

How well is information from all sources used to accomplish the following goals?
(% respondents)
1 Consistently and systematically

2

3

4

5 Not at all

Don’t know

Empower salespeople
11

40

26

16

6 1

Empower customer service
22

36

27

11

21

12 2

3

Create effective marketing campaigns
17

31

34

Refine product development process
13

33

31

12

3

8

Forecast demand
16

27

33

18

3

3

Improve service to shoppers
19

40

24

16 1

Improve retail offerings and selections
19

38

21

16

3 2

Adjust pricing
26

33

My organisation’s greatest challenges in using information
from store management employees and shoppers to improve
the customer experience are:
Select up to three.

22

14

5 1

In which region are you personally based?
(% respondents)
Asia-Pacific

(% respondents)

34

Western Europe
Putting recommendations into action

27
45

North America

Persuading shoppers to share experiences, both positive and negative
33

Persuading store employees to share feedback from shoppers,
both positive and negative

26

Latin America
6

Middle East and Africa

27

Synthesising information from retail outlets into coherent recommendations
26

4

Eastern Europe
3

Distinguishing relevant from irrelevant shopper information
25

Monitoring the results of actions in terms of shopper
behaviour and marketing metrics
25

Synthesising information from customer service
into coherent recommendations

Who are your organisation’s primary customers?
(% respondents)

22

Dealing systematically with extremely high volumes of information from stores
18

Demonstrating to shoppers that their comments are being addressed
17

Synthesising information from online channels
into coherent recommendations
3

Individuals
(eg, retail)

64

Businesses or other
organisations (eg,
business-to-business) 15
An equal mix of both

21

Other
0

Don’t know
6

11

Economist Intelligence Unit 2009


Appendix 1
Overall survey results

Beyond transactions
Building a compelling retail experience

What are your main functional roles?
Please choose no more than three functions.

Which of the following best describes your title?
(% respondents)

(% respondents)
Board member
General management

2

50

CEO/President/Managing director
Strategy and business development

15

22

CFO/Treasurer/Comptroller
Sales

5

22

CIO/Technology director
Customer service

5

20

Other C-level executive
Finance

5

18

SVP/VP/Director
Marketing

9

17

Head of Business Unit
IT

8

13

Head of Department

Operations and production

16

10

Manager
31

Information and research
9

Other

Human resources

6

9

Supply-chain management
7

What are your organisation’s global annual revenues
in US dollars?

Procurement

(% respondents)

Risk

5
2

R&D
$500m or less
$500m to $1bn

12

46
9

$1bn to $5bn

17

$5bn to $10bn

8

$10bn or more

20

2

Legal
0

Other
1

Economist Intelligence Unit 2009


Appendix 2
Americas survey results

Beyond transactions
Building a compelling retail experience

Appendix: Americas survey results

In your view, which of the following best represents the core strength of your overall business? Select only one.
(% respondents)

Customer service: Providing superior service to customers

64

Operational excellence: Creating highly efficient processes

18

Product innovation: First to market with groundbreaking new products or services

11

Other

7

Each of the organisation’s customer-facing departments influences the shopper via different channels. For each of the processes
below, how closely do your marketing, sales and customer service units work together? Please rate on a scale of 1 to 5.
(% respondents)
1. No coordination;
units are completely
separate

2. Ad hoc coordination;
not systematic
or consistent

3. Some procedures
established, but not
consistently followed

4. Procedures
established, regular
interaction

5. Broad, systematic and
consistent integration of
information and strategies

Don’t know

Planning promotions/campaigns
7

4

25

29

29

7

Executing promotions/campaigns
4

7

15

26

37

11

Measuring effectiveness of promotions/campaigns
7

18

18

39

14

4

Developing and launching new products
7

11

21

21

29

11

37

11

Analysing and segmenting shoppers
4

30

19

Gauging shopper satisfaction
7

25

21

25

21

0

Responding to shopper demands or complaints
11

33

30

22

4

Incorporating shopper feedback into products/services
7

11

29

43

11

Other
7

13

13

13

67

Economist Intelligence Unit 2009

0


Appendix 2
Americas survey results

Beyond transactions
Building a compelling retail experience

Do you agree or disagree with the following statements?
(% respondents)
Agree

Disagree

Don’t know

In chosing to do business with my organisation, price is the single most important factor most shoppers consider
36

61

4

Compared to our competitors, my organisation’s shoppers are more loyal
63

15

22

37

22

My organisation has an accurate way to estimate the lifetime value of customers
41

My organisation prioritises sales and marketing resources based on each customer’s lifetime value
26

56

19

We are currently developing a social media strategy
44

30

26

My organisation has more flexibility than its competitors in pricing its products
61

21

18

Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months
59

30

11

We are more engaged in developing products or services collaboratively with customers than we were 12 months ago
50

43

7

Shoppers view my organisation’s products and services more as commodities now than five years ago
44

30

26

Our margins are higher than the margins of most of our competitors
43

46

11

If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles

74

In your view, which of your organisation’s activities are most
in need of improvement? Select up to four.
(% respondents)

19

7

Which of the following would provide the biggest benefits in
integrating your organisation’s marketing, sales and service
activities? Select up to three.
(% respondents)

Targeting the right shoppers to achieve sales volume and revenue objectives
46

Reducing the cost of sales

Developing and sharing a detailed picture of shopper
behavior and preferences
39

43

Measuring/optimising effectiveness of marketing and promotional campaigns

Helping each function find and act on ways to support the others
32

39

Gathering shopper intelligence in the course of providing service
29

32

Segmenting and profiling shoppers
25

Maximising repeat purchases and building loyalty among shoppers
25

Cross-selling or upselling shoppers
18

Measuring the satisfaction of shoppers
18

Involving shoppers in product/service development (eg, co-creation)
14

Generating promotions/campaigns
11

Creating effective collateral
11

Ensuring that shopper complaints are resolved quickly

11

Building long-term relationships with store management
7

Other
0

Don’t know

Prioritising resources directed towards shoppers by total
value over the life of the relationship
Making each unit aware of how the others have
interacted with a given shopper
29

Establishing common definitions, assumptions and data
25

Integrating tracking of shoppers from initial contact
through to post-sales service
25

Measuring the probability that shoppers will turn into buyers,
and using these scores to guide sales
25

Presenting shoppers with a consistent picture of the organisation
21

Our company sees no need to integrate our marketing,
sales and service activities
4

Other
0

Don’t know/Not applicable
4

0

14

Economist Intelligence Unit 2009


Appendix 2
Americas survey results

Beyond transactions
Building a compelling retail experience

Which of the following trends have had the greatest impact on
your business over the past 12 months? Select up to three.

In which of the following ways does your organisation
empower shoppers? Select all that apply.

(% respondents)

(% respondents)

Global economic downturn
71

Offering additional value along with products (eg, in-store service,
merchandising improvements, sustainable packaging)
50

Significant demand shifts for our products/services
Creating educational forums for shoppers (eg, online content,
in-store content, communities of interest, direct-to-consumer outreach)

36

Emergence of new competitors

50

32

Improving usability, search and navigation of shopper-facing websites

Changing needs of shoppers

43

29

Building or supporting online communities of shoppers

Finding access to credit/capital

25

14

Other

Disruptive technology developments

0

14

Don't know

Emergence of new markets for our products and services

7

11

Changing needs of store management
11

Focusing on sustainability efforts

What avenues of customer feedback is your organisation best

and worst at collecting and using to improve the experience of
shoppers?
Select up to three from each column.

11

Accessing key components or resources through our supply chain
4

Other

(% respondents)

0

We are best at collecting and using
We are worst at collecting and using

Don’t know
0

Point of sale feedback
50
21

In-store sales staff

In which of the following ways does your organisation
empower store management? Select all that apply.

39
21

(% respondents)

Our own e-commerce site(s)
36

Improving online or self-service support tools for store managers
43

Making prices and sales terms more transparent for
easy comparability by store management

29

Third-party e-commerce sites
18
32

32

Phone order interaction

Improving usability, search and navigation of store-facing websites
29

Investing in self-service tools for store employees across
multiple channels (web, mobile devices, e-mail)
21

Building or supporting online communities

18
21

Direct response feedback
14
11

Call center customer service interactions
36

14

Other

25

Targeted focus groups
7

21

Don’t know/Not applicable
14

25

Online social media efforts

4
46

Other
4
0

Don’t know
7
11

15

Economist Intelligence Unit 2009


Appendix 2
Americas survey results

Beyond transactions
Building a compelling retail experience

How well is information from all sources used to accomplish the following goals?
(% respondents)
1 Consistently and systematically

2

3

4

5 Not at all

Don’t know

Empower salespeople
11

37

26

11

15

Empower customer service
26

30

26

11

7

Create effective marketing campaigns
18

25

39

14

4

Refine product development process
12

19

38

15

15

Forecast demand
11

29

36

18

4

4

Improve service to shoppers
14

29

32

25

Improve retail offerings and selections
14

32

39

11

4

Adjust pricing
30

22

My organisation’s greatest challenges in using information
from store management employees and shoppers to improve

the customer experience are:
Select up to three.

30

19

In which region are you personally based?
(% respondents)
North America

(% respondents)

82

Latin America
Persuading store employees to share feedback from shoppers,
both positive and negative

18

Asia-Pacific
46

Putting recommendations into action

0

Eastern Europe
36

Synthesising information from retail outlets into coherent recommendations
32

Persuading shoppers to share experiences, both positive and negative
29

0

Western Europe
0

Middle East and Africa
0

Synthesising information from customer service into
coherent recommendations
29

Monitoring the results of actions in terms of shopper
behaviour and marketing metrics
25

Who are your organisation’s primary customers?
(% respondents)

Distinguishing relevant from irrelevant shopper information
21

Dealing systematically with extremely high volumes of information from stores

21

Demonstrating to shoppers that their comments are being addressed
14

Synthesising information from online channels into
coherent recommendations
7

Individuals
(eg, retail)

64

Businesses or other
organisations (eg,
business-to-business) 18
An equal mix of both

18

Other
0

Don’t know
4

16

Economist Intelligence Unit 2009

Appendix 2
Americas survey results

Beyond transactions
Building a compelling retail experience

What are your main functional roles?
Please choose no more than three functions.

Which of the following best describes your title?
(% respondents)

(% respondents)

Board member

General management

0

46

CEO/President/Managing director

Strategy and business development

4

21

CFO/Treasurer/Comptroller

Finance

7

18

CIO/Technology director

Customer service

4

18

Other C-level executive

Operations and production
11

14

SVP/VP/Director

Marketing
14

14

Head of Business Unit

Sales

7

14

Head of Department

IT
18

11

Manager

Risk
32

Other

7

Procurement
4

7

Supply-chain management
7

Human resources

What are your organisation’s global annual revenues
in US dollars?

7

Information and research

(% respondents)

4

R&D
4

$500m or less
$500m to $1bn

17

39

Legal

4

Other

$1bn to $5bn

25

$5bn to $10bn

14

$10bn or more

18

0
0

Economist Intelligence Unit 2009


Appendix 3
Asia-Pacific
survey results

Beyond transactions
Building a compelling retail experience

Appendix: Asia-Pacific survey results

In your view, which of the following best represents the core strength of your overall business? Select only one.
(% respondents)

Customer service: Providing superior service to customers

70

Operational excellence: Creating highly efficient processes

13

Product innovation: First to market with groundbreaking new products or services

10

Other

7

Each of the organisation’s customer-facing departments influences the shopper via different channels. For each of the processes
below, how closely do your marketing, sales and customer service units work together? Please rate on a scale of 1 to 5.
(% respondents)
1. No coordination;
units are completely
separate

2. Ad hoc coordination;
not systematic
or consistent

3. Some procedures
established, but not
consistently followed

4. Procedures
established, regular
interaction

5. Broad, systematic and
consistent integration of
information and strategies

Don’t know

Planning promotions/campaigns
3

3

40

27

27

0

37

27

0

20

0

Executing promotions/campaigns
3

13

20

Measuring effectiveness of promotions/campaigns
7

13

13

47

Developing and launching new products
13

20

43

17

7

13

7

Analysing and segmenting shoppers
3

17

27

33

Gauging shopper satisfaction
20

23

37

17

3

Responding to shopper demands or complaints
23

57

20

Incorporating shopper feedback into products/services
3

10

27

43

13

3

Other
10

18

10

20

60

Economist Intelligence Unit 2009

0


Appendix 3
Asia-Pacific
survey results

Beyond transactions
Building a compelling retail experience

Do you agree or disagree with the following statements?
(% respondents)
Agree

Disagree

Don’t know

In chosing to do business with my organisation, price is the single most important factor most shoppers consider
23

73

3

Compared to our competitors, my organisation’s shoppers are more loyal
67

17

17

My organisation has an accurate way to estimate the lifetime value of customers
30

47

23

My organisation prioritises sales and marketing resources based on each customer’s lifetime value
37

43

20

We are currently developing a social media strategy
40

43

17

My organisation has more flexibility than its competitors in pricing its products
63

33

3

Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months
77

17

7

We are more engaged in developing products or services collaboratively with customers than we were 12 months ago
60

30

10

Shoppers view my organisation’s products and services more as commodities now than five years ago
47

30

23

Our margins are higher than the margins of most of our competitors
40

43

17

If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles

73

In your view, which of your organisation’s activities are most
in need of improvement? Select up to four.
(% respondents)

20

7

Which of the following would provide the biggest benefits in
integrating your organisation’s marketing, sales and service
activities? Select up to three.
(% respondents)

Targeting the right shoppers to achieve sales volume and revenue objectives
37

Cross-selling or upselling shoppers

Developing and sharing a detailed picture of shopper
behavior and preferences
50

37

Measuring the satisfaction of shoppers
37

30

Generating promotions/campaigns
27

Segmenting and profiling shoppers
27

Maximising repeat purchases and building loyalty among shoppers
27

Gathering shopper intelligence in the course of providing service
27

Measuring/optimising effectiveness of marketing and promotional campaigns
20

Building long-term relationships with store management
20

Reducing the cost of sales
20

Involving shoppers in product/service development (eg, co-creation)
20

Ensuring that shopper complaints are resolved quickly
13

Creating effective collateral
7

Other
0

Don’t know

Making each unit aware of how the others have
interacted with a given shopper
Measuring the probability that shoppers will turn into buyers,
and using these scores to guide sales
30

Prioritising resources directed towards shoppers by total
value over the life of the relationship
30

Establishing common definitions, assumptions and data
20

Integrating tracking of shoppers from initial contact
through to post-sales service
20

Helping each function find and act on ways to support the others
17

Presenting shoppers with a consistent picture of the organisation
13

Our company sees no need to integrate our marketing,

sales and service activities
3

Other
0

Don’t know/Not applicable
7

0

19

Economist Intelligence Unit 2009


Appendix 3
Asia-Pacific
survey results

Beyond transactions
Building a compelling retail experience

Which of the following trends have had the greatest impact on
your business over the past 12 months? Select up to three.

In which of the following ways does your organisation
empower shoppers? Select all that apply.

(% respondents)

(% respondents)

Global economic downturn
60

Offering additional value along with products (eg, in-store service,
merchandising improvements, sustainable packaging)
60

Changing needs of shoppers
Improving usability, search and navigation of shopper-facing websites

53

37

Emergence of new markets for our products and services

Building or supporting online communities of shoppers

23

33

Significant demand shifts for our products/services

Creating educational forums for shoppers (eg, online content,
in-store content, communities of interest, direct-to-consumer outreach)

23

Emergence of new competitors

33

20

Other

Focusing on sustainability efforts

7

17

Don’t know

Accessing key components or resources through our supply chain

13

10

Finding access to credit/capital
7

Disruptive technology developments

What avenues of customer feedback is your organisation best

and worst at collecting and using to improve the experience of
shoppers?
Select up to three from each column.

7

Changing needs of store management
3

Other

(% respondents)

0

We are best at collecting and using
We are worst at collecting and using

Don’t know
0

Point of sale feedback
50
10

In which of the following ways does your organisation
empower store management? Select all that apply.

In-store sales staff
60

7

(% respondents)

Our own e-commerce site(s)
20

Improving usability, search and navigation of store-facing websites

33

33

Third-party e-commerce sites

Making prices and sales terms more transparent for easy
comparability by store management

3
23

Phone order interaction

27

Improving online or self-service support tools for store managers

30
7

23

Direct response feedback

Building or supporting online communities

40

20

3

Investing in self-service tools for store employees across multiple
channels (web, mobile devices, e-mail)

Call center customer service interactions
17
17

20

Other

Targeted focus groups

3

27
20

Don’t know/Not applicable
37

Online social media efforts
3
33

Other
0
3

Don’t know
3
17

20

Economist Intelligence Unit 2009


Appendix 3
Asia-Pacific
survey results

Beyond transactions
Building a compelling retail experience

How well is information from all sources used to accomplish the following goals?
(% respondents)
1 Consistently and systematically

2

3

4

5 Not at all

Don’t know

Empower salespeople
13

40

37

10

Empower customer service
27

37

33

3

3

3

Create effective marketing campaigns
17

30

37

10

Refine product development process
14

45

24

3

7

7

Forecast demand
17

37

23

20

3

0

Improve service to shoppers
27

43

17

13

Improve retail offerings and selections
23

40

13

23

Adjust pricing
20

37

My organisation’s greatest challenges in using information
from store management employees and shoppers to improve
the customer experience are:
Select up to three.

17

17

10

In which region are you personally based?
(% respondents)
Asia-Pacific

(% respondents)

100

Latin America
Putting recommendations into action

0
47

Persuading shoppers to share experiences, both positive and negative
40

Monitoring the results of actions in terms of shopper

behaviour and marketing metrics
30

Synthesising information from retail outlets into coherent recommendations
23

North America
0

Eastern Europe
0

Western Europe
0

Middle East and Africa
0

Dealing systematically with extremely high volumes of information from stores
20

Demonstrating to shoppers that their comments are being addressed
20

Persuading store employees to share feedback from shoppers,
both positive and negative

Who are your organisation’s primary customers?
(% respondents)

17

Distinguishing relevant from irrelevant shopper information
17

Synthesising information from customer service into
coherent recommendations
17

Synthesising information from online channels into
coherent recommendations
3

Individuals
(eg, retail)

64

Businesses or other
organisations (eg,
business-to-business) 14
An equal mix of both

21

Other
0

Don’t know
3

21

Economist Intelligence Unit 2009

0


Appendix 3
Asia-Pacific
survey results

Beyond transactions
Building a compelling retail experience

What are your main functional roles?
Please choose no more than three functions.

Which of the following best describes your title?
(% respondents)

(% respondents)
Board member
General management

3

CEO/President/Managing director

52

Customer service

17

CFO/Treasurer/Comptroller

28

Marketing

3

CIO/Technology director

24

Sales

10

Other C-level executive

24

Finance

3

SVP/VP/Director

17

IT

7

Head of Business Unit

17

Strategy and business development

3

Head of Department

14

Operations and production

10

Manager

14
31

Human resources

Other

14

Information and research

10

7

Supply-chain management
7

What are your organisation’s global annual revenues
in US dollars?

Risk

(% respondents)

R&D

0
0

Procurement
$500m or less

50

$500m to $1bn 14

22

$1bn to $5bn

25

$5bn to $10bn

4

$10bn or more

7

0

Legal
0

Other
0

Economist Intelligence Unit 2009


Appendix 4
EMEA survey results

Beyond transactions
Building a compelling retail experience

Appendix: Europe Middle East and Africa
survey results
In your view, which of the following best represents the core strength of your overall business? Select only one.
(% respondents)

Customer service: Providing superior service to customers

61

Product innovation: First to market with groundbreaking new products or services

16

Operational excellence: Creating highly efficient processes

13

Other

10

Each of the organisation’s customer-facing departments influences the shopper via different channels. For each of the processes
below, how closely do your marketing, sales and customer service units work together? Please rate on a scale of 1 to 5.
(% respondents)
1. No coordination;
units are completely
separate

2. Ad hoc coordination;
not systematic
or consistent

3. Some procedures
established, but not
consistently followed

4. Procedures
established, regular
interaction

5. Broad, systematic and
consistent integration of
information and strategies

Don’t know

Planning promotions/campaigns
6

16

13

35

26

3

Executing promotions/campaigns
6

6

23

45

19

0

Measuring effectiveness of promotions/campaigns
3

16

29

35

13

3

Developing and launching new products
23

23

35

19

0

29

10

0

35

10

0

19

0

10

0

Analysing and segmenting shoppers

6

23

32

Gauging shopper satisfaction
3

23

29

Responding to shopper demands or complaints
3

16

29

32

Incorporating shopper feedback into products/services
10

13

35

32

Other
14

23

14

71

Economist Intelligence Unit 2009


Appendix 4
EMEA survey results

Beyond transactions
Building a compelling retail experience

Do you agree or disagree with the following statements?
(% respondents)
Agree

Disagree

Don’t know

In chosing to do business with my organisation, price is the single most important factor most shoppers consider
23

74

3

Compared to our competitors, my organisation’s shoppers are more loyal
61

29

10

My organisation has an accurate way to estimate the lifetime value of customers
32

61

6

My organisation prioritises sales and marketing resources based on each customer’s lifetime value
39

58

3

We are currently developing a social media strategy
26

48

26

My organisation has more flexibility than its competitors in pricing its products
55

39

6

Despite the recession, my organisation has greatly strengthened customer relationships over the past 12 months
58

29

13

We are more engaged in developing products or services collaboratively with customers than we were 12 months ago
45

48

6

Shoppers view my organisation’s products and services more as commodities now than five years ago
61

29

10

Our margins are higher than the margins of most of our competitors
39

48

13

If there is no difference in price, my organisation can win the sale based on service, convenience, brand reputation or other intangibles
81

In your view, which of your organisation’s activities are most
in need of improvement? Select up to four.
(% respondents)

13

6

Which of the following would provide the biggest benefits in
integrating your organisation’s marketing, sales and service
activities? Select up to three.
(% respondents)

Segmenting and profiling shoppers
48

Targeting the right shoppers to achieve sales volume and revenue objectives

Making each unit aware of how the others have interacted
with a given shopper

35

45

Establishing common definitions, assumptions and data

Cross-selling or upselling shoppers

32

42

Reducing the cost of sales
39

Maximising repeat purchases and building loyalty among shoppers
32

Measuring/optimising effectiveness of marketing and promotional campaigns
26

Gathering shopper intelligence in the course of providing service
26

Measuring the satisfaction of shoppers
23

Involving shoppers in product/service development (eg, co-creation)
19

Generating promotions/campaigns
16

Building long-term relationships with store management
13

Creating effective collateral
6

Ensuring that shopper complaints are resolved quickly
6

Other
0

Don’t know

Developing and sharing a detailed picture of shopper
behavior and preferences
32

Prioritising resources directed towards shoppers by
total value over the life of the relationship
29

Presenting shoppers with a consistent picture of the organisation
26

Helping each function find and act on ways to support the others
26

Measuring the probability that shoppers will turn into buyers,
and using these scores to guide sales
26

Integrating tracking of shoppers from initial contact
through to post-sales service
23

Our company sees no need to integrate our marketing,
sales and service activities
6

Other
0

Don’t know/Not applicable
3

0

24

Economist Intelligence Unit 2009