February 17, 2017
Some business publications are reporting that Warren Buffett’s recent decision to unload $900 million worth of Walmart stock has signaled the slow death of retail as we know it. This is a laughable assessment, and says nothing of the retail giant’s inability to maintain a quality customer experience across all of its channels. That alone is a far more credible assessment for Buffet’s loss of confidence in Walmart.
If Buffett thought the death of retail was imminent, his holding company Berkshire-Hathaway this week definitely would not have purchased 42.2 million additional shares of Apple — a retailer with exceptional in-store and digital customer experience. (Perhaps it’s more likely that Walmart — facing a glut of physical stores and ever growing competition with the much more CX-savvy Amazon — no longer seems like a sure bet as an investment.)
Brands in today’s retail environment simply must provide good customer experience across all channels — as well as be able to understand the contribution each of those channels have on the overall experience. Today’s consumers are evolving in how they shop — utilizing all channels to influence purchasing habits. For instance, the rise of BOPIS (Buy Online, Pickup In-Store) is one example. If a shopper made their way to a brick-and-mortar store to pickup an item purchased via mobile device, providing a sub-par in-store experience may dissuade them from doing additional shopping during their visit. At the same time, a poor in-store experience may also negatively impact a retailer’s ability to drive consumers to digital channels.
Looking at the latest ForeSee Experience Index, Walmart is clearly trailing behind other big brands with an FXI score of 72 (out of the study’s 100-point scale) for its in-store customer experience, dropping 4 points from last year. Brands with scores 80+ are considered to have met the FXI threshold for excellence, which other major retailers such as Lowe’s (82), Kohl’s (81), and Costco (80) met in the new study.
Walmart isn’t the only company with uneven FXI scores across channels as you can see from the graphic above. Meanwhile Apple, with top FXI scores in all channels, recently saw its stock price hit a record high.
The takeaway here is that good customer experience is a proven indicator of financial success and shareholder value.
Interested in more CX insights uncovered in the latest ForeSee Experience Index? Download the FXI report — or better yet, request a personalized briefing of the FXI results today.