Report: Evaluating Online Store Locators

We just published a new report, Online Store Locators Miss A Key Part Of The Experience.

The report evaluated the online experience of five large retailers (Home Depot, Kroger, Target, Walgreens, and Walmart) and five large banks (Bank of America, Citibank, Chase, US Bancorp, and Wells Fargo) using our SLICE-B experience review methodology. The report has 12 figures which provide details of the reviews and highlights several best practices that we found.

Here’s the executive summary:

Just about every bank and retailer provides a store or branch locator on its site. But how user-friendly are the experiences? Mostly mediocre. Temkin Group evaluated 10 large retailers and banks using its SLICE-B experience review methodology. Wells Fargo ended with the only “excellent” rating and Target was alone at the bottom with a “poor” rating. All of the sites struggle to support user’s goals after they find the nearby stores.

Download report for $195

Here are the overall results from the evaluations:

Download report for $195

The bottom line: Are you doing a good enough job helping people find your locations?

Execs Need To Focus More On Culture

Here’s an excerpt from Bruce Nussbaum’s recent blog post on BusinessWeek called Chrysler, Culture and Cerberus:

The Obama Administration’s lead car guy, Steven Rattner, is a Wall Street investment banker who lives by numbers and it makes sense to him to basically give Chrysler to Fiat to save American jobs. But neither he, nor Nardelli nor President Obama understand that cars and car organizations are all about culture, not numbers.

In the post, Bruce poses the question of whether it’s more important to manage a business by the numbers or to manage the culture. Great question!

My take: I wrote a post about Bob Nardelli’s reign at Home Depot called Home Depot Still Has A Spark Of Customer Centricity which was a follow-on to a post that looked at how Frank Blake (who replaced Nardelli) was trying to rebuild Home Depot’s customer-centric culture. These represent a case study about the potential downfall of  “numbers-driven” management style.

Here’s the comment that I left on the BusinessWeek blog:

The problem is that you need to manage both; culture and numbers. Over the last few decades, however, executives have overdosed on the numbers. So it leads to situations where leaders like Nardelli sap the soul out of Home Depot because they don’t understand culture.

Times have changed, but management has not kept up. That’s why I wrote a mini book called “The 6 New Management Imperatives: Leadership Skills For A Radically Changed Business Environment.” The first imperative is: “Invest in culture as a corporate asset.”

The bottom line: Culture is an undermanaged asset.

Learn From Home Depot And Macy’s, But Not Office Depot

There was an interesting article about the latest earnings announcement of retailers like Home Depot, Macy’s, and Office Depot.

First of all, Home Depot and Macy’s are following a recession strategy that I call simplify, target, and align (okay, I just made up that name). Home Depot simplified by closing peripheral businesses like Expo Design Centers and cutting 7,000 of its staff. It targeted by keeping high in-stock levels and maintaining its incentive pay structure. The align step should come next; they need to get the organization to understand and embrace the strategy. And, I loved this quote from Home Depot’s CFO:

We believe if we take care of our associates, they’ll take care of our customers

This statement perfectly aligns with the 4th law of customer experience: Unengaged Employees Don’t Create Engaged Customers. But what makes it even more impressive is that it came from the CFO! Hopefully Home Depot can ignite the customer-centric spark that it once had.

Macy’s, on the other hand, simplified by consolidating its four divisions into a single organization and it’s targeting with an initiative called “My Macy’s,” in which it will tailor the merchandise in stores to target the customers in particular regions of the country. I feel compelled to say DUH! It shouldn’t have taken a recession for Macy’s (or any other retailer) to create localized merchandising strategies.

The article also discusses Office Depot’s disappointing earnings and weak same-store sales. Those results don’t surprise me. Office Depot ended up in last place out of the 25 retailers in Forrester’s 2008 Customer Experience Index and also had the largest drop in its ratings from last year.

The bottom line: Simplify, target, and align!

Home Depot Still Has A Spark Of Customer Centricity

I’m in the process of publishing a report called “The Customer Experience Journey” which describes 5 levels of maturity as companies head towards Experience-Based Differentiation. As companies evolve past the first couple of stages, they need to develop “Customer-Centric DNA,” which I’ve defined as:

A strong, shared set of beliefs that guides how customers are treated  

So I’m always looking for tangible examples of this type of culture. Well, I found an example in a comment to one of my posts called Can Frank Blake Revive Home Depot? I know that people don’t always read the comments, so I decided to post an excerpt of it here:

I’ve been an Employee for 8years and yes the Nardelli era was hard, not only for the customers but also the employees who’s heart pumps orange blood. I stuck it out with the company because I know the creation of this company wasnt built on the values Bob Nardelli tried to push on all of us…. Now that we have Frank, I can feel the flame spark again… it may never be a strong flame like it once was but I still have faith that it will one day light again. For all of you frustrated customers I would like to tell you that I am personally sorry, even I lost the customer service focus that bernie and arthur built this company around… but I can honestly say I got it back, and I want to rub it off on every employee I come in contact with…. Frank understands that in order to do this we have to teach train and develop each other so that we can better serve you… it will take some time to build that back, but I can see the light at the end of the tunnel.

The bottom line: If most of Home Depot’s employees still feel this way, then I’m betting on the company!

Can Frank Blake Revive Home Depot?

Home Depot’s stock closed yesterday at $27.18; 29% lower than a year ago. That’s certainly troubling, but what’s even more concerning for the retailer is the poor feedback from its customers:

  • According to the American Customer Satisfaction Index, Home Depot’s satisfaction dropped 4.3% in 2007 — the largest drop of any specialty retailer that it tracks. By comparison, Lowe’s customer satisfaction increased by 1.4% over the same time-frame.
  • In Forrester’s Customer Experience Index, Home Depot received a score of 72%; 25th out of 27 retailers. Lowe’s, on the other hand, ended up with a 79%; 15th out of the retailers.

This is a terrible story. So is Home Depot doomed to failure? Not necessarily. While the firm has a lot of problems to fix, it’s got one key part of the solution in place: Frank Blake as CEO. I just read a Q&A with Blake in the Wall Street Journal which really impressed me. Blake seems to be doing a lot of the right things to make the company more customer-focused, in particular:

  • He went to the founders for advice. During store visits with Bernie Marcus, Blake learned the importance of the connection between associates and customers. As I’ve said many times in this blog, companies often lose site of what’s important; letting the hunt for profits obscure the company’s purpose. Founders can often help restore the original sense of purpose.
  • He thanks employees– personally. When it comes to great customer experience, it’s critical for executives to get actively involved. I’ve often discussed the thank you notes (called “Blue Notes”) that David Neeleman (JetBlue ex-CEO) sent out to employees who did something good for customers. It turns out that Blake asks for examples of associates doing extra-ordinary things and he sends out 40-50 handwritten thank you notes per week.
  • He understands the levers of leadership. To quote Napoleon: “The role of the leader is to define reality and give hope.” Blake understands that he needs to lead the entire organization through major change so he sticks to simple messages that everyone can understand and pushes his executive team to make decisions.

If Blake is looking for what to do next, he should take a look at following eight questions that gauge the customer-centricity of management teams:

  1. Do senior executive staff meetings have a recurring agenda item on customer experience? (this does not include dealing with customer emergencies)
  2. Do internal communications from the CEO/President regularly include discussions of customer experience?
  3. Do external communications from the CEO/President regularly include discussions of customer experience?
  4. Is customer experience explicitly discussed (in some form) within the company’s strategic plan(s)?
  5. Does the executive team have a clear set of customer experience objectives?
  6. Do most of the executive team members have goals based on customer experience objectives?
  7. Is the compensation of executive team members tied to customer experience objectives?
  8. Does the organization believe that the CEO/President would trade-off some short-term financial results for longer-term customer experience gains?

The bottom line: Home Depot appears to be in good hands.

%d bloggers like this: