Lost Opportunities: Out of Stock (OOS) and Retail Customer Experience
Oct 31, 2012 by Confero Inc.
Do you worry about lost sales opportunities and less than perfect customer experiences when your associates interact with customers? Does it worry you even more to think of situations when customers visit with a specific item in mind, only to find the item not on your shelf? When customers visit your location with a product in mind and don’t find it, negative customer experiences are not the only result. After experiencing this frustration, customers may return; however some opt to shop at another store where they feel more confident about finding items on the shelf. In fact, fifty percent of those who encounter an OOS will visit another store to find the item. The most frustrating piece of this for store managers is that the item may have been in the location, however not visible to the customer. One study indicates that 25% of the items were actually in the store; however employees had not stocked the item yet.
Out of stock situations cause missed revenue opportunities that negatively impact bottom line. The reasons range from insufficient staff to perform restocks, poor labeling and distribution problems. During tougher economic times, two issues also come into play. Stores try to get by with fewer staff on the sales floor. Second, because couponing has become more popular in the past few years, more customers use coupons that require purchase of two items, causing items to sell out quicker than in the past. Regardless of the cause, studies show that retailers can achieve at least 10% more revenues by keeping up with appropriate stock levels.
Need a way to ensure that your shelves remain stocked? Some mystery shopping providers also offer audits. Auditors visit locations, observe the retail environment for product placements, competitor placements, marketing materials, signage and product availability. Like mystery shoppers, auditors offer another set of eyes for your operations. They quickly report on observations, including OOS situations, so that management may react immediately to correct any problems.