Dive Brief:

• Publix and Costco ranked first in customer service in Newsweek’s America’s Best Customer Service 2019 list . The inaugural survey was conducted in an effort to better understand the forces driving change in the retail space.
• Publix claimed the top spot in the supermarket category followed by ShopRite and Trader Joe's, while Costco was first in the superstore and warehouse club segment followed by Meijer and Target. QuikTrip ranked first among convenience stores, followed by Wawa and Sheetz.
• Publix and Costco also earned a spot on Fortune’s 2019 list of the World’s Most Admired Companies, alongside Target, Walmart, Amazon and CVS Health. Sprouts Farmers Market was included in the list’s food and drug stores segment.

Dive Insight:

Offering shoppers top-rated customer service is a major priority for retail chains as the brick-and-mortar space competes with online outlets and the growing e-commerce segment. To compete with companies such as Amazon, traditional retailers are relying on premium customer service to provide a personalized touch that online shopping lacks. Some analysts have predicted that by 2020, one-fifth of the nation’s retail businesses will have shuttered their stores in favor of online outlets.

Newsweek’s study, which collects and analyzes data from 141 retail and service provider categories and 20,000 U.S. shoppers, surveys things like communication, technical competence, accessibility and customer focus. Whether the shopper was willing to recommend the brand to friends and family also was considered.

ShopRite, which ranked second in customer service for the supermarket category, maintains a customer care center that addresses both in-store and online needs for the shopper. This includes assisting pharmacy clients, developing a menu with one of the brand’s registered dietitians, or having personal shoppers hand-select an online grocery order. ShopRite is a family-owned company, which may appeal to some consumers who eschew the impersonal touch of e-commerce or a big corporate business.

Publix is notorious for its customer service and has gained it a cult-like following because of it. It routinely makes the top of customer service lists annually. Just this year, the retailer expanded its complimentary valet parking service. It's perks like this, in addition to other customer service initiatives like associates greeting customers as they walk in and assisting them with bags to their cars, along with a strict "no tipping" policy, that enhances the in-store experience.

Newsweek’s inaugural survey is not the first effort at assessing how much customer service matters. In 2017, a survey by InMoment surveyed 30,000 U.S. and Canadian shoppers on their shopping habits as well as their in-store experience.

The study concluded that consumers are seeking out meaningful experiences in both their in-store and digital shopping experiences. Shoppers rated previously successful shopping experiences as one of the top three reasons to come back to a particular brand, in addition to the quality of products and services offered. It also determined that having a positive interaction with a staff member increased a customer’s satisfaction by as much as a third. In addition, more than half of the survey respondents said they valued knowledgeable staff who may recognize their personal purchasing patterns.

Despite the clear importance of customer service, many shoppers may opt for the online experience due to convenience, price or curiosity as the e-commerce segment continues to grow.