The toy retailer appoints head of American Eagle Outfitters’ digital technology to oversee IT and digital operations as it takes its e-commerce platform in-house.
The big-spending store customer who expects a higher level of handholding has a parallel in the online world: Customers with the highest income and spend the most react more negatively to customer service they perceive as sub-par, according to Jupiter Research.
The big-spending customer who expects a higher level of handholding in return is one of retail’s entrenched stereotypes. Turns out there’s a parallel in the online world, where customers who have the highest income and spend the most react more negatively to customer service they perceive as sub-par, according to new findings from Jupiter Research.
91% of high-income consumers (household incomes of $100,00 or higher) polled by Jupiter said they’d be less likely to buy from a company online after receiving poor customer service vs. 84% of lower-income customers ($35,000 or less). That spread applies offline, too: 59% of high-income buyers said they’d be less likely to buy from a company offline if they receive poor customer service vs. 50% of lower-income consumers.
In efforts to improve the bottom line, retailers have attempted to migrate more customer service to the web where it’s less expensive to provide. But if poorly executed, such moves can alienate customers and end up costing more, not less. “Revenue defense, not cost savings, should compel companies to improve service operations and bolster service investment,” says Jupiter.
And the possibility that a customer contact can go south is greater with high-income shoppers not only because they are more likely to react negatively, but because they initiate a greater number of contacts with the companies from which they purchase. 63% of shoppers polled who’d spent $500 or more online during the previous six months had made a customer service contact during that time, but only 28% of those who’d spent $100 or less did so. In fact, big spenders contacted customer service more than five times as frequently as did the lower-spending customers.
Though every customer service contact deserves resolution, the data suggest that those from higher-value buyers should receive priority handling, according to the research firm. “With those customers’ higher contact frequency,” Jupiter says, “there is a greater likelihood of a service slip-up, putting retailers’ relationship with high-value customers at risk.”
And the reward for those slip-ups could be rapid customer flight. Unlike in the real world, it takes very little effort for Mrs. Got-Rocks to check out a competitor’s site.