We all know shoppers don't like waiting in lines: it's often among the top-five reasons cited for opting to shop online instead. And now, a study by LoyaltyOne and Verde Group with Dr. Deborah Small, a Professor of Marketing and Psychology at the Wharton School of the University of Pennsylvania, has provided some interesting additional information. According to the study, shoppers at mass merchants who become frustrated by check out lines reportedly spend 23% more than the average customer. They spend US$545 versus $446 per fiscal quarter.
It's no wonder, then, that stores like Dollarama, which increased profit by 22% in Q1 this year, will introduce mobile payment terminals to some stores this year, and most stores by next year, to help speed up the checkout process.
Mass merchants, according to the study of 2,500 shoppers, jeopardize 25% of total revenue by annoying customers with slow lines and other inconveniences. CE retailers were not included in the study, but it found that apparel retailers put 16% of potential revenue at risk; department stores risk 15%; drugstores risk 12%; and grocery stores risk 11%.
Other common (mis)behaviour which put off shoppers and made them leave without purchasing included the "not my department" attitude by department store staff. These irate shoppers report spending about twice the average, per quarter: US$543 as opposed to US$261.
About half the 2,500 customers surveyed in the study said they had an issue during their last retail shopping trip. Of 1,250 annoyed customers, fully 81% said nothing to the retailer, and they weren't saying anything, at least positive, to friends and family either.
As a research fellow at MIT Sloan School's Center for Digital Business, and the author of books like Who Do You Want Your Customers to Become?, Michael Schrage is professionally amazed that Starbucks' customers have been conditioned to patiently line up. As a consumer, however, it irks him.
Further annoying him is the 20 or so extra seconds required by each shopper to extract a credit or debit card, and often a loyalty card, from wallet or purse. "We're talking an additional three or four minute delay. No big deal, right?
"But, really," says Schrage, "I'd pay Starbucks out of my own pocket to run a simple, cheap experiment to see if peak time lines moved faster and smoother if a posted sign asked customers to have payment ready when they hit the till.
"My bet," he adds, "is that Starbucks could quickly enjoy the best of both worlds: faster service, less queue abandonment, and happier customers."
Or retailers could follow the example of Paul Weber's Hamburgers, an iconic eatery en route to cottage country north of Toronto famed for not only its immaculate park-like grounds, but the speed of its lines. Order takers come to the line, calling out the orders which are tossed on the grille. By the time the cashier, who handles only payment and no food, is reached, the customer's order is hot and ready.
Small wonder Weber's had to install a pedestrian bridge for the safety of patrons willing to brave a multilane expressway to reach it from the other side of the road.
So, rejoice when customers complain. Complainers are 84% less likely to reduce their spending. Remember the old maxim? "If you don't like our service, tell us. If you do like it, tell your friends."
Schrage notes that sophisticated "customer satisfaction surveys" often dismiss wait time annoyances as trivial. However retailers solve wait times, by mobile payment terminals or old fashioned order chits, don't forget to act on the complaints.
We all know shoppers despise having to wait in line, but did you know that those who get most frustrated are the ones who tend to spend more? Shoppers at Whole Foods, Houston St., New York City, courtesy David Shankbone