Wednesday, April 24, 2019

TK Maxx tops loyalty and satisfaction chart but H&M fails to make an impact with customers


In December 2014, more than 3,4000 consumers participated in a nationwide study designed to uncover the consumer‘s favourite fashion retailer, investigate factors that drive satisfaction and loyalty and reveal trends in multiple channels, including e-commerce sites, in-store experiences, and mobile apps.

Results from the study by Market Force Information, a customer intelligence solution specialist, found that the customer satisfaction and experience was relatively low for all seven retailers who appeared in the survey. The study found that 18% were dissatisfied with their recent visit to their favourite retailer – a significant number, especially before Christmas. Crucially, those who were very satisfied/delighted with their experience would be twice as likely to recommend the retailer/brand to their friend or colleague.

The Composite Loyalty Score (the average rating of satisfaction and likelihood to refer) of all seven retailers shows intense competition between the brands, with TK Maxx the front runner at 48%, followed by New Look at 43%. Other brands had similar scores with variants of a percentage mark between them.

Consumers are conscientious buyers

Consumers confirmed this tight competition among fashion retailers with wallet share at about 50% for all brands. TK Maxx had an average wallet share of 51% in comparison to Marks and Spencer‘s with 55%. Next and New Look at 49% and 50% respectively. Primark had 53% and Debenhams had 49%

The study identified four key drivers of satisfaction, including:

ӢPracticality (sizing, choices, value for money etc.)

ӢEnvironmentally Conscious (CSR and green practices, types of materials used, information on country produced etc.)

ӢJust For Me (opportunities to share fashion tips and ideas/information, customisation, exclusivity etc.)

ӢStore Operations (speed of checkout and overall atmosphere)

Customers that indicated their favourite retailer executed on all four behaviours were 5 times more likely to be highly satisfied with their experience than those who felt that retailers executed well only one or two of these factors. Only 10% of all consumers rated their favourite retailer as executing well on all four critical drivers.

The survey found that engaging with customers is vital to the brand loyalty and satisfaction. Retailers who have assistants that can creative a look and offer support and advice on products are more likely to score a top box satisfaction rate of 5. Having delighted customers means that they are two times more likely to commend a retailer to friends. With 1 in 4 customers having visited their favourite stores recently and 78% spending money, NEXT and Debenhams were twice as likely to help shoppers and create high conversion rates of sale.

Online Retailing – Debenhams, NEXT and H&M Top found as top three e-tailers.

With over £1bn recorded online sales in the UK in 2014, this area of ecommerce is an important consideration for retailers. Although TK Maxx does well in its physical stores, it fails with e-tailing. However, customers were more likely to purchase from H&M online than buy in-store. Next and Debenhams are almost equal in its percentage share of purchases (76% and 74% respectively) but Marks and Spencer‘s, although has a good satisfaction rate with the website, fails to close in on checkout completion.