This is part of Retail Outlook, a series of articles running over the next four weeks that explore timely topics and trends for the retail industry in 2020. Click here to see more stories in the series.

Retailers don’t have infinite pools of dollars, time or teams to dedicate towards all great ideas with customer experience enhancement in mind. 

So where do you invest for the greatest bang for your buck? 

The key outcomes you want to strive for are the key levers to materially impact your brands advocacy; and also your customers loyalty – these are what we coin the six key pillars or the DNA for customer experience excellence.

Our six pillars provide a valuable prioritisation framework which can support a retailer’s CX program focus and shape a new way of organisational thinking. 

The power in practice lies in supporting traditional pain and gain point analysis and building out customer-focused solutions. The framework enables retailers to develop the “on-stage” and “off-stage” delivery of experiences that are both co-ordinated and continuously optimised. 

Too often organisations focus on the shiny “on-stage” programs, which of course are lots of fun. 

However, these programs also command significant management focus while often lacking seamless connectivity to the middle and back of house functions that are critical to delivery.

KPMG’s Australian research is based on evaluation of 114 brands across 11 sectors, painting a clear picture of the outcomes required within each of the six pillars, to help ensure the brands products and service propositions are conveyed effectively. 

Not all pillars are of equal value

In Australia, personalisation is the most important driver for advocacy and loyalty, followed by integrity and time & effort levers.

While the numbers speak for themselves, many c-suite executives still struggle to drive an enterprise-wide commitment to customer-led transformation, even when the economics stack up.  

For instance our global research demonstrates:

• Customer-centric organisations are 38 per cent more likely to report greater profitability than competitors
• The revenue growth of the top 50 brands is 54 per cent greater than the bottom 50, at an aggregated level
• The EBITDA growth of the top 50 brands is 202 per cent greater than the bottom 50, at an aggregated level
• Customer-centric organisations are 38 per cent more likely to report greater profitability than competitors
• The top 25 CX leaders in the US achieved double the percentage revenue growth of the top 25 F500 companies
• The percentage revenue growth of the top 25 CX leaders in the US over one year alone was more than seven times that of the CX laggards – the bottom 25.

Then there are the people, which in retail is critical to service delivery. Organisations with great CX put employees at the centre of their CX architecture.

Happy employees = happy customers = happy shareholders 

Happy employees produce 37 per cent more sales ​and are 12 per cent more productive. The result? 

• Companies with happy employees outperform their competition by 20 per cent
• The most engaged employees are 87 per cent less likely to leave the company, make 60 per cent less errors at work, and absenteeism rates are reduced by 37 per cent 
• Companies that lead in CX typically have 1.5 times as many engaged employees
• Engaged employees are more motivated to go above and beyond to satisfy customers, leading to improved customer experiences.

Of course CX is a dynamic roadmap. Customer expectations are higher than ever before, are conitnuously evolving and are industry agnostic. 

Excellence in retail service design can come from disruptors or financial services such as new payment platforms.

The economics of customer experience

The key challenge for retailers is ensuring the economic value is maximised when customer expectations or the brand promise is met.

Exceeding these unnecessarily through over investment can lead to minimal incremental ROI.

Expectations in an omnichannel retail world are anticipated to grow in overall service levels – think delivery options, speed and digitally-enabled, integrated seamless shopping operations.  

We often say silos should remain on farms, but unfortunately they still exist across inconsistent channel delivery. 

We believe retailers should prioritise removing friction, such as repetition of information that is requested and captured throughout the business.

The customers expectation is that once they share their information with you once, they shouldn’t need to keep sharing it (unless they choose too of course). 

Moving from delivering a great CX to now predicting customer needs is “the new black”. 

At its core, it’s a CX strategy that is underpinned by connected operations and data analytics across all channels to match business outcomes with the front-end design.

By Lisa Bora, Partner, Customer, Brand & Marketing Advisory, KPMG

Download your free copy of the Australian Retail Outlook 2020 here.