Creating engaged associates and loyal customers

Improving Customer Satisfaction

DEFINE

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DefineCurrent State• Insufficient customer participation on the customer survey

– Anecdotal customer issues:• 1. Survey Length• 2. Unsolicited promotions (checkbox default value is checked)

– Low scores in stores reporting low participation numbers• Possible cause:• Human behavioral patterns

– Negative Experience: informs1-20 people (average 14)» Impetus to endure tedious, lengthy survey completion

– Positive Experience: informs 0-2 people» Customer perceives the opportunity cost unfavorable» 15-45 minute survey time for statistically improbable odds

of winning a $1,000 gift card

4

Define

Deliverables• Gain a representative sample of the consumer population

– Improve customer survey reliability– Enhance forecasting

• Eliminate customer experience gaps between actual quality and potential quality– Soliciting feedback continuously by driving customer survey

awareness

Scope• Store-level initiative• Specific focus on underperforming and high interaction areas

– Service Departments– Specialty Departments– Front-End

5

Define

6

Define• Tempkin Customer Experience Rating

– Walmart = 13th

• Tempkin Customer Loyalty Rating– Walmart = 14th

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Percent of Customers Planning to Repurchase based on Complaint Handling

73.0%

44.0%

15.0%

70.7%

52.4%

20.3%

79.9%

40.0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Completely Satisfied Satisfied Not Resolved

Financial ServicesAuto ServiceLarge Durable Goods

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Increase in Customer Net Present Value (NPV) for a 5% increase in customer retention

95.0%

75.0%

35.0%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Advertising Agencies Credit Card Companies Software Companies

9

Define

10

MEASURE

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Measure

Key Metrics• Customer Count• Average $ Transaction• Customer Experience Track• Sales per Man Hour

Progress• Exponential increase within first month and gradual increases M-O-M

following initial implementation• Reevaluate for stagnation in figures over the trailing 6 month period

– Smooths out seasonal fluctuation curve

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Measure

Overall Merchandise Faster Friendlier Cleaner Price/Value

August 8.02 8.00 8.26 8.03 8.20 7.76

September 8.45 8.04 8.22 8.20 8.22 7.82

October 8.51 8.30 8.41 8.35 8.40 8.11

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MeasureCustomer Responses• August = 84• September= 243• October= 151

Success3 months• +10% Customer Experience in 3 month Exponentially Weighted

Moving Average (EWMA)• +5% in Average $ Transaction 3 month EWMA• +3.5% Customer Count Month-Over-Month

– Dramatically increasing repeat customer base• +2.5% Sales per Man Hour 3 month EWMA• Increased employee morale, teamwork, and collaboration

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Measure6 months• +5% in 3 month customer EWMA over 3 month evaluation• +5% in Average $ Transaction 3 month EWMA• +3.5% Customer Count Month-Over-Month

– Sustaining and further developing repeat customer base• +2.5% Sales per Man Hour 3 month EWMA• Increased associate engagement- Associate Opinion Surveys (AOS)

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ANALYZE

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Analyze• Current State

– Score polarization• Market Level

– 0.5-1 point range between highest and lowest stores• Store Level

– 0.4-0.7 point range between highest and lowest departments

• Critical Roles– Store Manager- project approval and promotion of objectives to

include cultural change in service mindset– Assistant Store Manager- spearhead initiatives and ensure proper

implementation– ZMS- conduct training and continuous development

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Analyze– Department Manager- set cultural norms through exemplary

behavior and follow-up with consistent evaluation of direct reports’ embodiment of values and approach

– Sales Associates, Cashiers, People Greeters- fully understand and execute proposed tasks to specification

• Resources– External vendor- banner design and printing– Food– Cooking Supplies– Highlighters

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IMPROVE

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Improve

• Constraints– Disengaged associates during the training process• Checklist phenomena

– Work and Planning Time• Creation of personalized training initiatives is time intensive• Delivery must be conducted with sizable groups to reduce work

impact

• Solutions– Develop targeted training • Cover key points and reasoning behind decisions• Simulate practical application with role-play scenarios

– Cashier Scripts• “Have you taken the survey this month?”• Include typical customer responses and appropriate associate

reaction

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Improve– Knowledge assessment• Designed for technical service areas: TLE, Electronics, Sporting

Goods (Hunting, Fishing)• Assures necessary foundational knowledge is readily available

to assist with complex, technical customer questions

• Maintaining high performance– Reward and Recognition Program (Quarterly)• Achievement Banner

– “Voted a Walmart Store of Service Excellence by our Valued Customers”

• Cookout for the entire Store (Annually)– Estimated expense: $500-600

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Work Breakdown Structure

Onboarding New Hires

Front-End Highlighting Repeat Customer InteractionService Area Interaction

Customer Service Training and Delivery

LEVEL 1

LEVEL 2

LEVEL 3

Develop Scripts

Knowledge Assessment

Cross-selling and Upselling Techniques

Relationship Building

Service Failure Response

Service Failure Response

Service Failure Response

Active Listening Techniques

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CONTROL

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Control• Monthly Customer Experience Progress Evaluation:

– 8.0 in all departments – 9.0 overall store rating– “Store of Excellence”

• Confirm positive trends:– Measure weekly value added metrics for an uptrend

• Measure Frequency and Severity of Customer complaints:(Daily)– Formal: letters to the president– Informal: issues voiced to any associate at the store level– Address outstanding matters with corresponding associate– Cover systemic service-related issues at storewide meetings

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Control

• Evaluate effectiveness of Customer Experience score:– Direct relation between CE and other metrics– Proportionately equivalent metrics based on baseline figures and

standard deviations

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Control• Future iterations

– 2nd

• Reconfigure Customer Survey– Allow for anecdotal input

» Identify an issue not covered in a structured layout with only prompted/targeted questions

» Additional ideas for question creation/assessment criterion» Measurement along other dimensions

– Reduce length» Encourage greater participation » Higher reliability- eliminate opt-out stemming from

protracted completion time: 30-45 minutes 3-10 minutes– 3rd

• Establish and design on-site training program nationwide– Widespread impact on customer service rankings– Instill brand loyalty in customers– Not relying solely on cost leadership point of differentiation

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Control– 4th• Customer Loyalty Program

– Rewards tied to purchase amount each year– Encourage repeat business– Expand purchasing breadth:

Consumer adopts mindset of a truly one-stop shop (aimed at saturated, affluent markets)

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QUESTIONS?