Traditional models of retail are changing and businesses need a senior role that reflects that – the chief customer officer.

The increasing trend to appoint chief customer officers is changing the structure, accountability and reporting lines of retail boards.

In many cases, the previously appointed customer champion, the marketing director, has had his/her responsibility extended to encompass online – both content and trading – and customer service. Some retailers have gone the whole hog and given them all channels.

This represents a big step change for a function that may have previously been regarded as a cost rather than revenue generator.

This can give rise to confusion around authority and accountability.

More traditional retail operations directors may fail to see the benefit of a holistic approach to customer engagement, despite the fact that click-and-collect is driving footfall – and often additional purchases – in a store estate that may now be seen as too large to be economically viable.

To counter this resistance, more progressive retailers have moved to a catchment rather than store-based P&L statement.

Reviewing performance

While many companies want to move towards a more cohesive perspective, legacy systems often cannot cope with new demands for cross-channel visibility of the customer journey.

KPIs and incentives also need to be reviewed – performance still tends to be judged solely on sales and margin, rather than NPS or customer satisfaction data.

Similarly, less enlightened retailers continue to categorise customers by route to purchase and not their buying characteristics or lifetime value.

The rise in importance of social media is often underestimated too. Peer reviews can have a huge impact and provide valuable data, meaning brand reputation and trust have to move up the agenda.

‘A powerful force’

These days, due to the complexity of the customer journey, there is an increasing need to understand shopper behaviour and retailers routinely spend a fortune on internal departments or external consultants
to provide the necessary insights.

At the same time they make it incredibly hard for customers to actually have contact with the company and speak to a real person, seeing it as too expensive. But this is the most straightforward and accurate way of gathering vital information.

“The chief customer role should help to break down functional silos and create a genuinely customer-focused team”

Fran Minogue, Clarity

As Robin Terrell, chief customer officer at Tesco, says: “The chief customer officer’s responsibilities must work across channels, product, customer experience and marketing.

A big part of the job is to understand what customers want and to tailor that experience around their needs.”

The chief customer role, if successfully adopted by the organisation, should help to break down functional silos and create a genuinely customer-focused team.

Marketing, merchandising, supply chain and online working together with the prime objective of engaging and delighting the consumer is a powerful force.

In mature markets, where every point of share is hard won, the ability to really understand the core customer and offer a joined-up and differentiated experience must surely create a competitive advantage.

  • Fran Minogue, managing partner, Clarity

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