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VCU Chair Urges Retailers to Focus on Customer Service

6/2/2009

Retail expert David Urban, Ph.D., chair of the Department of Marketing in the VCU School of Business, says that recessions tend to highlight every problem area that a retailer has – from operating inefficiencies to knowledge of their consumers.

In order to combat the flaws that the recession exposes, Urban says retailers should focus on customer service – understanding that their customers are being affected by the state of the economy – and on operating a streamlined organization.

Urban said too many retailers do not show a basic knowledge of their clients’ current challenges.

“What a lot of retailers don’t really get is that consumers are extraordinarily stressed in the recession just as the retailers are,” Urban says. “You’re going to see people going back two or three times before they actually make a commitment to buy a product, especially if it’s a big ticket item, so customer service people need to be prepared.”

Urban says that retailers understand that they have to become more efficient in a recession. Those businesses that were inefficient in their operations before the economic downturn have “had to do the most to really try to deal with the consequences of the recession.”

However, one of the most common mistakes retailers make is deciding just where to cut expenses. Often, spending on advertising and employee training are targeted when times get tough, but Urban says that relationship building and branding are more important than ever during an economic downturn.

“The biggest thing retailers can do is continue to invest selectively and efficiently in the processes that will allow them to position themselves well coming out of the recession,” Urban said.

Still, not all shops will survive to see the turnaround, and many have already succumbed.

For consumers, this means fewer options, but for the businesses that survive, it means new opportunities and challenges.

And it is not just the obvious competitors that stand to reap the benefits of failed businesses. For example, in the case of Circuit City, Urban says that though fellow electronic supplier Best Buy will likely absorb some of Circuit City’s former customers, other stores like Wal-Mart are already beefing up their electronics sections to accommodate new business.

About David Urban
David Urban, Ph.D., who has taught at VCU since 1989, has won eight national and international awards for teaching excellence and received the Outstanding Faculty Award in 2001 from the State Council of Higher Education for Virginia, the highest honor for faculty at Virginia’s colleges and universities. Urban formerly held a joint appointment as director of the Survey and Evaluation Research Laboratory in the L. Douglas Wilder School of Government and Public Affairs at VCU. His business and marketing background includes a four-year tour of duty as an officer in the U.S. Navy Supply Corps, as well as training or research assignments with: Ford Motor Company, Hyundai Motor America, Kimberly-Clark Corporation, several other business firms and many Virginia state agencies.

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