New report from LCP Consulting reveals that only a third of major retailers are actually talking to customers to understand their needs…

Although three quarters of UK retailers (77%) believe the most successful businesses focus on delighting the customer first to drive profitability, only around half this number (39%) are talking to customers to understand their needs.

These findings are published today in a new LCP Consulting report – Integrating the retail supply chain. The report says that this lack of knowledge about customer needs and expectations is even more concerning given that customer expectations are higher than ever before.

Stuart Higgins, Retail Partner at LCP Consulting, said:

“How can retailers hope to truly understand their customer needs and expectations, and respond with appropriate service models, if they are developing their entire customer understanding without looking outside the business’ existing knowledge base? There is a major risk in defining a customer offering based on an internal perspective of the customer, as it then becomes a self-fulfilling prophecy.”

The LCP report, the fourth in a series from the leading retail supply chain consultancy, interviewed over 100 leading retailers in the UK and US, in addition to a number of senior retail executives including: Gavin Mullaley (eCommerce Fulfilment Director, Aldi), Simon Ratcliffe (Infrastructure Director, FatFace) and Phil Clarke (COO, The White Company).

Simon Ratcliffe, Infrastructure Director, FatFace, added:

“Customer expectations have been evolving at a rapid pace and you must keep up with these changes. It is important for retailers to genuinely understand their customer expectations, or the customers they are trying to capture. At FatFace, we are just as interested in the 85% who don’t buy from us.”

On a more positive note, the LCP report found that there is a marked decrease in the number of retailers focusing their service offer on matching that of the competitors, and those retailers defined by LCP as being an Omni-channel Pioneer are twice as likely to undertake in-depth analysis of customer data (76%) compared to those retailers defined as Omni-channel Followers (32%).

The LCP report also found that winning retailers are going one step further to delight their customer, by integrating and shaping their supply chain to service customers’ needs profitably. This focus has now extended to a much deeper understanding of costs in four areas: