Is the customer really the most important thing in retail?

Photo: Groceryshop
Sep 27, 2022

Pardon my cynicism, but if I had a dollar every time I heard some variant of the phrase “the customer must be at the center of every retail decision” at Groceryshop last week, I’d be able to buy a nice meal at one of the many overpriced restaurants in Las Vegas.

Nearly every facet of retail discussed at the event featured some type of customer-first notion, from retail media to supply chain. Even the CEOs keynoting the event were focused on the use of tech and process to enhance customer engagement. The new CEO of Whole Foods, Jason Buechel, said “customer” no less than 20 times in about 20 minutes. (I counted.) John Furner, CEO of Walmart US, used that term or a related one several times in his session, as did Kroger CIO Yael Cosset, who focused on the digital angle in his discussion of the customer.

It wasn’t as if other key retailing factors were ignored during the conference. There were excellent tracks on ecommerce, supply chain, marketing, technology (of course) and even physical retail and merchandising.

Still, and with full acknowledgement that the statement may be entirely accurate, the proliferation of the customer-first approach at Groceryshop was borderline cliché to the extent that one of the presentations featured a slide with this Sam Walton quote: “There is only one boss — the customer. The goal as a company is to have customer service that is not just the best but legendary.”

There has to be more than just a customer focus in retail. Merchants need to sell something and need to sell it in a certain way. There has to be a staff that supports the marketing and selling of that product. There needs to be a process to get the product from the point of the production to the point of consumption. And there need to be guardrails to ensure the product and the process is as risk-free as possible.

By constantly repeating “customer-first” at conferences and in internal and external communications, companies run the risk of it becoming noise that is ignored more than followed. If the most recent Groceryshop is any indication, we are rapidly approaching that line.

DISCUSSION QUESTIONS: Does the customer really need to be the primary focus of every retail decision? What other factors, if any, are as critical for retail decision-making?

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39 Comments on "Is the customer really the most important thing in retail?"

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Paula Rosenblum

Funny question. There’s no doubt the term “CX” is beyond over-used at this point — but — retail today is about what the customer wants to buy, not what you want to sell. So, I guess, yes.

If I were going to prioritize, I’d say the keys to the customer experience are:

  • Product;
  • People;
  • Processes;
  • Technology.

If I were going to make a list of what we’re missing at the moment it’s innovative product, employees that actually care, updated, efficient processes and, of course, the technology to support them.

The big danger these days is the perception that some technology or another will be the magic bullet that solves all problems. Like those horrific voice response systems (or whatever you call them) that allow companies like Xfinity to presume their God-awful telephone system is actually helpful.

Georganne Bender

Xfinity’s phone system is a good example. So are retailers who get you into the store only to tell you that what you want is available online, or piles of merchandise tossed on fixtures or the floor as if customers are expected to shop that mess, or our favorite, Paula, retail buyers who think women over 50 only want to wear leopard print and sequins. You can’t preach service until you have experienced it firsthand in your own stores.

David Slavick

Agree, it used to be that clientelling was the buzzword before personal service or personalization became the “thing.” Just having a women’s apparel chain that has fashion sense and is on trend would be appreciated by all women over 50 — remember Coldwater Creek or Casual Corner or hey, how about Kohl’s having apparel for women that they would actually love which isn’t athletic or casual wear? Might help their current situation.

David Slavick

You mean you don’t like the stupid tapping sound while you are on hold that somehow makes you be patient, as if someone is routing your call? I have to assume a social psychologist or behavioral scientist recommended this hold experience.

2 months 12 days ago

I would agree with this list except I swap people and products places. If you don’t care about and take care of your people, they won’t care about taking care of your product or customers.

I would argue that one of the problems in retail right now is that companies have put the customer so far into the first priority slot they are inadvertently beating down their people.

Neil Saunders

The customer is critical and should be considered in all decisions. Unfortunately, for some retailers “customer first” is a meaningless platitude that is rarely acted upon. Of course, the customer is not the only consideration as there are many other stakeholders – investors, staff, communities, etc. – that need to be considered and have their needs balanced into decision making. I’d also say that properly understanding the customer is vital. How good a grip do retailers really have on who their customers are and what they actually want?

Dr. Stephen Needel

Great points, Ron – as usual. Yes, the customer is critical but no, they do not need to be the focus of every decision. Let’s be honest, most of the decisions a retailer makes are invisible or irrelevant to the customer. Don’t make life more difficult for your customers and if there’s a problem, see if you can fix it. Otherwise, worry about your bottom line, optimize your ongoing processes as much as possible, and have nice front-facing people.

Katie Thomas

At the end of the day, the consumer should be at the center of every retail decision. Even if you can find success through other avenues at first, over time knowing the consumer will win out. The bigger challenge is what you call out – that everyone *says* the consumer is at the center, but in reality they are not. They are not willing to listen to the consumer, making long-term investments at the expense of short-term ones, and that is where the breakdown occurs.

Bob Phibbs

I couldn’t agree more. Who could argue with “the customer has to be at the center of all decisions”? It’s like saying, “the target is that big red bullseye.” Much like, “The customer wants to buy what they want, when they want, and how they want,” these cliches mask the very real problem – the details. Many don’t understand, it seems, that creating interest, buzzwords, and Powerpoints do not fulfill any of that. It takes people building people to build customer conversions.

DeAnn Campbell

The customer is the only mechanism for the continued existence of a brand or retailer, so they do need to be the focus of every system, process, decision and resource. Yes, it’s necessary to invest in staff, technology and real estate, but without the customer those investments are lost. Regardless of how much attention and love has been placed into product selection, staff training and marketing, If no one buys the products or services then that business is out of business.

Ken Morris

Yes, the customer should be the center of every retailer’s universe. Just outside that center should be the in-store people who interact with the customers. Everything else in the retailer’s business should support delivering goods and experiences that make customers love them and their brand. And, yes, that requires a lot of technology and expertise behind the scenes.

Now, is the “customer first” mantra overused? Of course it is, and for good reason. We need to double down on the customer. We have doubled down on shareholders for years, and where are we today? It’s imperative to find out what customers want and give it to them. It’s as simple as that.

Nikki Baird

LOL, Ron, I love it! I agree with your point on product – you can have the best customers in the world but if you have nothing to sell them, what’s the point? But I would add one more wrinkle to this. Everyone talks about “the customer” but they’re all mostly talking about what they want to do TO the customer. It’s not about understanding the customer, or enabling the customer, or solving the customer’s problems or delighting them. It’s about getting the customer to do what retailers want them to do: getting them to spend more or devote more attention. Those are outcomes – if you can delight a customer or save them time or money, they will freely give you more of their attention and more of their spend. But you can’t just demand those things!

I agree – “the customer at the center” has become a mantra almost without meaning.

Ken Wyker

You nailed it, Nikki! The problem isn’t the focus, it’s the objective.

Too many retailers focus on targeting the customer to get them to do what the retailer wants. It is far more effective to view the situation from the customer’s point of view and work toward creating an environment that nurtures the customer relationship and makes it easy and rewarding for customers to get what they want from you.

Georganne Bender

The answer to this question is yes, the customer really is the most important thing in retail. And everything else including buying, merchandise presentation, marketing, policies, etc. must be customer-focused, too.

The reality is that the customer is no longer first in retail. You can say it in every way possible, but all you have to do is walk a sales floor to see how far stores have drifted from what customers really want and can’t easily find. You can’t just give lip service to customer service and think you’re good, you have to practice it every day.

Jeff Sward

Yes, of course retail is all about “customer-first.” But the quick qualifying filter to add is “how?” Differentiated product that establishes a moat? Commodity product but with emphasis on price and value? Speed of delivery? A differentiating value-adding service? The next filter might be “when?” Meaning, what are the priorities to best serve the customer today and tomorrow? How does that change a year out? Three years out? I think the customer is always at the center of the decision making process, but it’s about managing the Rubik’s Cube of variables involved in staying ahead in the highly competitive and evolving world we live in today.

Richard Hernandez

As we all know, retailing has changed over the past 20 years. For so many years it was the customer that was most important because we really didn’t have any other data to use to make decisions, but innovation, people and other factors have caused us to look at retail in different ways. I believe this will continue to evolve as changes in habits will drive our definition of retail.

Nicola Kinsella

Amazon prides themselves on being “customer obsessed.” It works. You make different decisions when you are “customer led” and not just “customer aware.” Anyone who thinks they can make decisions without factoring in customer data and insights without a negative impact to the business is fooling themselves. To be clear, that doesn’t mean doing everything a customer says. It means truly interrogating customer data, generating smart insights, and iteratively tweaking your offering to meet their needs.

Brad Halverson

Nice, Nicola. The distinctions you make show the difference between stating platitudes versus putting them into action to grow a customer centric business.

David Spear

The retail customer journey is as important now as it ever was, albeit a bit more complex today with multiple shopping touch points and digital modalities that are used. Whoever buys product, whoever visits stores, whoever shops online is and should be at the center of decision making. Understanding consumer behavior and the motivations and idiosyncrasies of why decisions are made during the moment of truth are critical to research, new product innovation, programmatic media, promotions, pricing, merchandising. Retailers who lose sight of this are going to see their businesses struggle.

Shep Hyken

Let’s consider this: Without customers to buy what we sell, we have no business. So the customer is a very important part of the retail business. That said, there is more and more emphasis being placed on what’s happening inside the business with employees. Who would’ve ever thought there would be such a shortage that it would wreak havoc on the retail world? So, without employees to sell, customers won’t be taken care of, and therefore won’t buy the products. It opens the door even wider for online retailers to win more business. I’ll go back to my statement at the beginning of this answer. Without customers to buy what we sell, we have no business.

Gene Detroyer