The world’s most successful retailers are those with a laser focus on their customers’ needs, according to customers surveyed in dunnhumby’s Global Customer-Centricity Index (CCI).
Some of the highest scoring retailers included Tesco, which scored highly for its customer loyalty rewards programme, and Lidl and Aldi, winning with customers thanks to their value-focused approach. They also included Trader Joes with its focus on speciality needs and Waitrose, which excelled on its product range and service.
The Global CCI report focused on seven ‘pillars’ – Affinity, Range and Service, Promotions, Price, Communications, Ease (of shopping), and Rewards – identified by customers as the aspects of the shopping experience that matter most to them. By identifying the key drivers behind a customers’ likelihood to repurchase from a particular retailer and their desire to recommend the retailer to friends and family, the study also demonstrates a direct link between customer-centricity and improved financial performance. Retailers were scored for their performance against each pillar in order to determine the most customer-centric retailers by country.
Retailers with the top quartile CCI score saw their market share grow by an average of 7% from 2015-2016 representing significant business value for retailers who understand and meet their customers’ needs.
The study found that, of all the pillars, Affinity correlates most closely with high customer-centricity, indicative of the personal connection that is built by retailers when their offering genuinely reflects their values to drive long-term loyalty. M&S topped the UK’s list for Affinity, with other global high scorers on the Affinity pillar including Costco, Trader Joes and Jumbo. The CCI Report recognises positive Brand Affinity as an outcome of excelling on other pillars that matter most to customers.
The top 100 retailers consistently perform well on price, range, service and promotions, with attributes reflecting common themes such as good value, enjoyable shopping experience and satisfaction.
However, successful strategies for customer-centricity vary in different parts of the world. Service and convenience are key in Asia, while Latin America has a very clear focus on price, illustrated by retailer D1 topping both Colombia’s price and affinity lists. Both British and Japanese markets are increasingly recognising price and promotion (28% and 48% respectively). Meanwhile, value offers from the likes of Aldi (UK) and Walmart Seiju (Japan) are having a positive impact among shoppers in the UK and across Europe.
The study also shows that in the US, Asia and most of Europe, an enjoyable shopping has significant impact on customer perceptions. All highest scoring retailers shared an emphasis on meeting customer expectations with clearly marked prices, developing trust and transparency, stocking a relevant range of well-valued products complete with an easy checkout process. So, despite the changing, omnichannel retail landscape, the successful retailers here demonstrate that the fundamentals of getting the customer journey in-store right are still paramount.
Julian Highley, Global Director of Customer Knowledge, dunnhumby said: “Particularly across Europe and in Asia, there are strong financial rewards to be enjoyed by the most customer-centric retailers. Doing one or two things well will help retailers build a connection with shoppers. For retailers that can forge and protect a niche; the message is to build total clarity around their customer offering. Larger, more general retailers should harness their data assets to listen to customers and personalise key aspects of their proposition on a scale that only they have the power to do.”