What Mark Cuban’s Secret Shopper Experiment Can Teach Us About the Future of Retail
If you tell your fleet of 100 stores to do something, less than a quarter of them will do it correctly, and on time. This isn’t a hunch: it’s a research-backed fact. Store execution has been retail’s Achillies heel for decades.
So when Mark Cuban enlisted a third-party team of secret shoppers to assess how well Dallas-based retailers were complying with mandatory protocols, all of us here at Zipline didn’t hold our breath.
Of course, the findings of the study weren’t comforting.
“Ninety-six percent of businesses were noncompliant across all mandatory protocols and all locations,” said Cuban. And nearly one-third of those locations were “less than 50 percent compliant across mandatory protocols as established by the Governor’s office.” It seems it’s simply not enough to tell retailers that something is “mandatory” these days. (But we already knew that.) So what else does Mark Cuban’s experiment show us?
Scale Isn’t Necessarily a Competitive Advantage
Cuban’s secret shoppers found that enterprise retailers were just as guilty of noncompliance as their smaller counterparts. These results are counterintuitive, of course. Cuban assumes (and rightly so) that “a larger parent corporation would be highly concerned with variable degrees of compliance among their corporate-owned restaurants and would push for standardization and measurement.” However, that high degree of concern alone isn’t effective enough to drive the level of standardization needed. According to one study, only 21 percent of companies actually measure compliance levels, while 28 percent of HQs just assume that the tasks that they're sending are getting done.
Furthermore, it’s possible that being part of a parent franchise may actually detract from an individual retail location’s ability to remain compliant. Post-COVID-19, the majority of mandatory guidelines for opening a business are location-specific. The standards in Dallas are far different than those in New York City or San Francisco. Without sophisticated tracking and targeting capabilities, a retail company that needs to juggle an onslaught of conflicting protocols for a geographically diverse fleet of stores may, in fact, be doing its field teams a disservice by even attempting to push for standardization and measurement. It can be almost impossible to track the shifting city, state and regional guidelines as retailers dip their toes into this “new normal.” Some companies will be better off relying on their store managers to determine what their individual communities deem acceptable health and safety standards.
When it Comes to Customer Satisfaction, the Stakes Are Higher
In the “old world,” botched retail execution meant customers might have to deal with confusing promotional signage, poorly merchandised goods, or — in the case of more severe product recalls — the occasional health risk. For the most part, if a store didn’t follow HQ’s direction to a T, the consequences were relatively minor: a slip in customer loyalty, a poor customer satisfaction score, a missed opportunity for an upsell.
However, the impetus for Cuban’s study reveals there’s a great deal more at stake these days. “I wanted to know if these are places that I would feel safe taking my family to,” he says. When choosing a place to shop or eat, consumers are now using a different filter. In a world where a trip to the mall or a restaurant can have dire health consequences, consumers aren't looking for convenience or choice; they just want to feel safe.
But everybody’s definition of “feeling safe” is a little bit different. And in many cases, a truly “safe” environment may look no different from an “unsafe” one. How can you tell if a store associate has washed their hands? How do you know the last time a dressing room has been sanitized? It’s quite possible that retailers will need to resort to security theater tactics in an effort to appear as safe as possible to consumers.
If foot traffic sank or if sales slumped, retailers historically assumed their marketing was to blame. (And that’s assuming their campaigns were executed perfectly across the fleet, which really never happened.) Today, those same indicators could be due to a myriad of other factors — e.g., employees not wearing masks or properly social distancing. Perhaps “perceived safety” becomes another key performance indicator lever on the balance sheet, right up there with units per transaction and conversion. In order to pull that lever, retailers will need a way to show their teams, clearly and succinctly, what “safe” customer service looks like — and they’ll need to hold them accountable.
Emily Lane is a product evangelist at Retail Zipline, working with customers and prospects to drive store execution and engagement through better communication.
Related story: Thinking About Implementing a Compliance Checklist? Read This First.
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Emily Lane is a product evangelist at Retail Zipline, working with customers and prospects to drive store execution and engagement through better communication. Prior to Zipline, Emily spent 10 years managing store communication at major retail brands like Gap and Old Navy.