Why Employees Trump Tech in the Race for Engaging Customer Experiences

The typical talk in retail circles lately has centered around tech—how to get the most out of AI, projecting the future of voice and obsessing over how to capture more mobile sales. Even when it comes to brick and mortar, the focus has been on innovations that speed up checkout, tie in the online customer journey and transform dressing rooms. And while much of these same themes were discussed at the recent Shoptalk conference in Las Vegas, it was worth noting how much the presenters wanted to discuss their employees, the value they bring to their operations and the ways in which they support them. It seems the new focus on customer experiences has put people in the spotlight.

Ulta

From panels to keynotes, employees were top of mind. At Ulta, they received top billing right along with its Glam Lab mobile app, which allows for virtual makeup try-ons, and partnerships with Google and Facebook. CEO Mary Dillon expressed the importance of Ulta Beauty’s informed staff during her keynote.

“For Ulta, our guests come into our stores and they certainly can touch and feel physical products but they can also have an emotional experience around interacting with our associates. It’s about humans performing services on other humans,” she said.

This one-on-one connection is a big plus for the Moroccanoil. JuE Wong, global CEO for the hair and skin product company, said her team is very good about harnessing the power of social and email marketing, but one of their most valuable assets has nothing to do with tech.

“In beauty, consultants might spend five minutes with a customer. In a hair salon, you have someone for at least 30 minutes, if it’s a blow out,” she said, adding that face time is powerful because often if a client likes how their hair turns out, they’ll ask what products were used. Wong said the company is now trying to empower hair stylists to be more proactive in wielding their influence.

Meanwhile, investors Tricia Patrick and David ibnAle noted how much of their time is spent on picking and supporting the right employees. “It’s incredibly important to have the ability to hire the right people. We’re thinking about the people infrastructure at the business, which is a big change from five or 10 years ago,” Patrick said of her firm Advent International. “It was always important, but we weren’t spending a lot of our time on that. We spend our time on people resources. We spend a lot of time and money building up our team.”

For ibnAle, who invests in early stage companies through his firm Advance Venture Partners, a large part of the decision around which businesses to back is based on those that are “authentic.” “We tend to look for new problems being solved by people who care about the problems and have skill sets optimized for that,” he said, adding that part of his role is to help build out these fledgling teams. “We tend to be very involved in hiring and human capital and helping them think through the type of culture they want to build.”

Further, Target CEO Brian Cornell pointed out that the retailer is shoring up its culture by providing employees in specific departments with more product training to allow them to better assist shoppers. At Macy’s, CEO Jeff Gennette said the retailer is galvanizing its associates through its new incentive program, which rewards employees for the company’s gains toward its transformation.

Employee training

During an “Evolving Store Workforce” panel, executives from The Container Store, Walmart and The Source took a deeper dive into how to encourage and empower their sales teams to be even greater resources and representatives of their brands.

“We churned 75 percent every year when I started. It resulted in massive recruitment costs—just a nightmare,” said Charles Brown, president of The Source, a consumer electronics chain in Canada. “We have that down to 40 percent. We’ve saved millions and millions of dollars in driving retention.”

In addition to the savings, the company can quantify the sales benefits, too. To illustrate the difference between a green sales person and a more seasoned one, Brown threw out some numbers that reflect how employees’ value increases over time. “After three months, they sell $90 per hour,” he said. “In six months, they’re up to $110 per hour and by a year, it’s $150, so retention of your sales associates is so critical.”

To keep employees and boost sales, The Source started by refreshing its stores. While the refresh probably wasn’t lost on shoppers, it definitely went a long way toward motivating employees, he said. From there, the company instituted a training program that provides salespeople with 40 hours per year. “They love that we invest in them,” he said.

Though the stores are a high-tech environment, Brown said the training isn’t about how to operate the gadgets on display. “It’s not on technology. We recruit for that,” Brown said. “We train on how to listen and ask the right questions. Consumers come in and most have checked out product online so they come in with generic knowledge but no insight. They don’t understand how does this product make my life better and enhance my digital experience.”

Further, managers go through leadership training, which delves more into the economics of the store, basic retail math and ways to manage their staff.

Today, The Source receives roughly 30,000 resumes a year, up from 1,000 before the company decided to invest in employees, according to Brown.

Walmart

Walmart is having similar successes with its Walmart Academy training program.

Dacona Smith, SVP of the west division of Walmart U.S. store operations, said the company educates its hourly supervisors, department managers and assistant managers on leadership, culture and retail fundamentals in its 191 academy locations.

While Smith declined to quantify the value of an employee who has gone through this training, he said the retailer has seen a drop in turnover, which has tangible benefits.

“With that training we see less turn over in our supervisor ranks that have gone through the academies, less turnover of the assistant managers and less turning in those people they lead,” he said. “Retention makes a big difference. As associates stay with Walmart, they’re much more productive and their ability to interact with customers and other associates and managers increases. That retention drives productivity. It drives sales.”

Training in technology plays a big part in the academy lesson plan, which provides its own benefits.

“There’s more emotional buy-in as people graduate the academy,” Smith said. “And as they get more exposure to the technology, it enables them to become more comfortable with technology in a business setting, so therefore when technology changes they’re able to adapt even faster.”

Employee tools

John Thrailkill, EVP of technology and business development for The Container Store, explained how a combination of education and outfitting the retailer’s staff with the right technology has transformed the consumer experience.

The Container Store offers part-time employees 100 hours of training and full-time associates with 250 hours with the focus on how to problem solve on behalf of shoppers.

“One of the biggest problems is communicating with teammates and finding them [in the store],” he said, adding that the company had been using walkie talkies, technology that’s more than 70 years old. Today, employees use an innovation from Theatro, which allows sales people to talk directly to each other and query the system about stock information and staff locations.

While Thrailkill said The Container Store has equipped employees with tablets for a few specific tasks, he’s found that this voice system provides a better consumer experience. “A voice set up is much better,” he said, explaining that tablets require staff to bury themselves in their screens. “It’s heads up, and I can continue talking and being connected to what’s going on—and in a retail setting that’s what you need.”

The technology also allows staff to continue to work with shoppers and keep them engaged rather than having to abandon them while they go in search of products or people elsewhere in the store.

Providing its sales help with this tool, is a great example of how technology can aid the human connection, Thrailkill said.

“You’re going to continue to see this investment in the idea retail experiences but it won’t be successful if they’re not investing in tools for their employees,” he said. “If it’s just customer facing apps, there’s not that much need to have that physical environment in stores.”