A couple of times a year, I do some wireless mystery shopping. I walk into several wireless stores--a mix of carrier-owned (Verizon, AT&T), independent third party (Wireless Toys), and big box (Best Buy, RadioShack) stores--in a few different cities, and gauge how the store experience has evolved alongside the value proposition that the industry is trying to promote. My conclusion after the most recent set of site visits is that the operations side has improved significantly, but the overall customer experience still does not "delight." The objective of many customers walking into a wireless store is to get in and out of there as quickly and unscathed as possible--a mentality akin to visiting the Department of Motor Vehicles. This is a problem, because the store experience is not keeping pace with the evolution of how wireless is increasingly becoming a part of the digital life framework.
Before delving into what needs to be improved, it is important to recognize how wireless is different from other touch points in consumer electronics. First, the primary objective in wireless retail is still focused on selling services, rather than things. This takes longer, is more complex, and involves a different type of training and compensation structure for store employees. Second, more than 50 percent of all transactions in stores have nothing to do with selling anything. These are people who walk in to pay a bill, have a problem with their phone, or have some question about their service. This latter point means two important things--there is a needed focus on triage and traffic flow; and a need to carefully manage store costs.
A major focus over the past 2-3 years has been on improving the operational aspects of wireless stores. Customers were waiting in huge lines and were spending too much time in the store given what they were trying to accomplish. So there was a big focus on the basic blocking and tackling of the store experience. That focus centered around three key principles:
- Streamlining processes. This is not sexy stuff, but includes things such as reducing the number of screens a store agent needs to plow through to sign up a new customer.
- Automating certain functions. This automation includes such things as putting bill payment kiosks in the stores, and encouraging customers to use the Web for self-service.
- Managing traffic flow. This mainly involves up-front triage when a customer walks into a store, pointing them in the right direction, and managing expectations of wait times.
While there is still much work to be done, I would say that significant progress has been made along many of the elements most frustrating to customers and store managers alike.
The next phase presents a different set of challenges. The focus on value-added services, more advanced devices, and greater role of the phone as part of the overall digital lifestyle will place greater stresses--and create new opportunities--for the wireless retail channel. I believe there are three essential priorities, all of which are inter-related. First, there is still a huge amount of work to do with respect to sales training. While store employees are more knowledgeable about data services than they were a couple of years ago, very few are able to successfully navigate the range of devices, operating systems, PC synchronization, etc., that is becoming part of the wireless territory. Whether the customer receives good (or even correct) advice or help varies widely. Of course, it would be tempting to benchmark against Apple store employees, but a more realistic comparison is the quality of training and expertise at Best Buy (good) compared to Circuit City (lousy).
The next priority is merchandising. It is still amazing to me how little delineation there is between the range of phones displayed in wireless stores, or why so few can be tried out. Accessories are another huge, largely under-tapped opportunity. Most wireless accessories are undifferentiated and unattractive, and you have to go through gyrations to figure out which charger goes with which phone, or why you should spend $79.99 on a Bluetooth headset that does the same thing as the $59.99 one next to it. By contrast, look at the exciting range of accessories that have been built for Apple products, or at the $100 Monster cables you buy to connect your DVD to your TV compared to the $6.99 RCA cables of yesteryear. Besides being cool and attractive, these accessories are hugely profitable. If wireless phones are also going to be media players, cameras and Internet devices, we need to build a better accessory ecosystem around them.
Third, we need to improve the look and feel of wireless stores. There have been some attempts to create higher-end stores or "experience" stores, but few have seen the volume increase needed to justify the higher cost. I think there's some reasonable room for incremental improvements, without having to be Apple or Bang & Olufsen. Less garish lighting, demonstration islands in the middle of the store, and more attractive displays for phones and accessories would be a good start. Think Starbucks vs. Dunkin' Donuts, or Panera Bread vs. Subway. Over time, this is going to be about selling a digital lifestyle, not just a phone or service plan.
Mark Lowenstein is Managing Director of Mobile Ecosystem. Click here to subscribe to his Lens on Wireless newsletter, and to find out more about an exciting event planned for October, the New England Mobile Summit.