Grocers Face Heightened Customer Dissatisfaction: The Impact of Stockouts and Checkouts on NPS

Grocers are facing two significant challenges impacting customer satisfaction: the frustration caused by stockouts and the importance of "soft skills" at checkout.

Even though 95% of grocers are experiencing a decline in stockout incidences, customers are less forgiving when they do occur, especially when they have a coupon for an out-of-stock item. 

Furthermore, the checkout experience is becoming a critical factor in customer satisfaction, with the human touch continuing to matter.

In this post, we’ll explore these two trends in-depth, examining the reasons behind the heightened dissatisfaction with stockouts and the shift in customer preferences at the checkout. We will also discuss how grocers can leverage insights from the customer journey to improve experiences and stay ahead of the competition. 

The Trends

Consumers are Less Forgiving

Since Q2 2021, fewer consumers have reported products being unavailable in-store as grocers have learned to successfully navigate supply chain challenges coming out of COVID. However, when customers experience in-store item unavailability, they are less forgiving compared to a year ago. The industry eNPS (episode Net Promoter Score) has declined 6 points from -12 to -18 for that specific episode over the past year (Q1 22 - Q1 23).

Coupons and Stockouts: A Recipe for Disappointment 

In some instances, grocers are shooting themselves in the foot, enticing consumers with coupons only for consumers to find out they're out of stock in-store. 10% of shoppers cite that they had a coupon for an unavailable item. In Q1 2022, eNPS when the customer had a coupon for an unavailable item was -12. In Q1 2023, it declined to -18. Customers are clearly more upset now than they have been in the past when they’re unable to redeem coupons for desired items.

• Unequal Impact on Grocers and Consumers - The negative stockout trends aren't impacting all grocers equally. Those with strong private labels and those that promote unique/specialty seasonal offerings (e.g., Trader Joe's, Costco) that are often on rotation or limited time perform better on this episode. In addition, consumer type is correlated with experience. For example, discount shoppers are "hurt a little less" when items they want are out of stock in-store. In return for lower prices, these shoppers may be more willing to accept that certain items are unavailable or more open to alternatives. Traditional grocery stores and mass merchants are the poorest performing in this stockout episode.

Mitigating Dissatisfaction from Stockouts

While stockouts cannot always be avoided, grocers can better mitigate the chance and impact on customer satisfaction with common sense strategies. Stockouts present an opportunity for grocers to demonstrate their commitment to customer satisfaction and uphold the spirit of human-centric service.

• Rainchecks and IOUs - One way grocers can show good faith is by providing "IOUs" or "rainchecks" to customers who have coupons for out-of-stock items. This gesture not only acknowledges the inconvenience caused but also reassures customers that their savings opportunity is not lost. Extending the validity of coupons for future use or making them applicable to comparable products demonstrates a commitment to customer satisfaction and a willingness to go the extra mile.
• Clear Communication and Transparency - Transparent communication is key in managing customer expectations during stockouts. Having employees on hand to answer customer questions about an out-of-stock item can help alleviate customer frustration. Whether the item was recalled due to a listeria outbreak or there's a supply shortage, transparency can help build trust,  understanding, and foster a genuine human connection.
• Dynamically Managing Coupon/Sales Communications - With data and analytics on customer preferences and inventory levels, grocers can increase customer satisfaction with more promoted items in stock in-store.
• Real-Time Inventory Management - Real-time inventory management systems can help grocers monitor stock levels and make informed decisions about promotions and sales. By having access to up-to-date inventory information, grocers can avoid promoting items that are at risk of stockouts, decreasing  the likelihood of customer dissatisfaction.
• Ensuring Substitute Products are Easily Found - By making it easy for customers to find suitable substitutes for out-of-stock items, grocers can minimize the impact of stockouts on customer experience. Improved store layouts, signage and staff training can help customers quickly locate alternative products.
  

NPS Prism can be a valuable tool in understanding the human element in these situations. By analyzing customer feedback and behavior, grocers can gain insights into how their actions during stockouts are perceived and what steps can be taken to improve the experience.

The In-Store Checkout Experience: Why People Skills Must Continue To Be Prioritized 

The in-store checkout experience continues to disappoint customers, with industry-wide eNPS scores declining by 5 points since Q2 2022. As technology is introduced to promote efficiency at the register, NPS Prism data suggest softer skills and people skills continue to be important for keeping customers happy. Over 90% of grocers are performing poorer on this episode in the past year than they were vs. Q2/Q3 2021 - Q2 2022. Consumers are reporting less favorable experiences across both cashier and self-checkout interactions, with cashier checkouts declining by 6 points and self-checkout technologies declining by 8 points.

NPS Prism suggests areas that might be driving dissatisfaction. Checkouts are becoming "longer" and "harder," with a 4% from Q2 2021 - Q1 2022 vs Q2 2022 - Q1 2023 in the number of shoppers waiting over 5+ minutes and a 5% decline in shoppers being very satisfied  4% decline in shoppers being satisfied with the time taken to checkout. There is also a 3% decline from Q2 2021 - Q1 2022 vs Q2 2022 - Q1 2023 in shoppers finding checkout to be easy. Cashiers are perceived to be less efficient and less friendly, with customer perceptions on cashier efficiency down 4% and customer perceptions on cashier friendliness down 3%.

Improving the In-Store Checkout Experience: A Human-Centric Approach

Grocers who are known for their exceptional people skills, like Trader Joe's and Publix are now outperforming the "checkout disruptors," who were once the leaders on checkout NPS.

Their focus on human engagement over digital engagement is keeping customers happier. While technology might be key to reducing some  frustrations, current solutions aren't cutting it. And consumers don’t want more technology to be a substitute for quality interactions with staff.

• Turning Self-Checkout into a Customer Delight - Addressing the self-checkout experience is a golden opportunity to elevate customer satisfaction in grocery stores. While self-checkout offers speed and autonomy, it's the human touch that can transform this process into a delightful experience. Knowledgeable, friendly customer support can be the game-changer, turning potential confusion or frustration into a smooth, positive interaction.

• The Power of Presence: Staff and Equipment - To ensure an efficient checkout experience, stores need to strike the right balance between self-checkout terminals and staffed registers. Imagine a customer walking into a store and seeing a sea of unused registers while they wait in line. It can be frustrating and create the impression that the store is not adequately staffed or “doing all it can” to keep lines moving.
  
• Training and Empowerment - Investing in staff training can help improve the efficiency and friendliness of cashiers, leading to a better checkout experience for customers. Grocers should provide ongoing training and support to ensure employees are equipped with the necessary skills and knowledge to provide exceptional service. Empowering staff to make decisions and resolve customer issues can also contribute to a more positive checkout experience.

See What’s Trending in the Grocery Industry With Insights From NPS Prism

NPS Prism is Bain & Company’s powerful CX benchmarking platform for grocers to gain valuable insights into customer satisfaction and loyalty. With industry-specific benchmarks and actionable insights related to both online and in-store customer experiences, NPS Prism empowers grocers to create tailored strategies that resonate with their customers and foster long-term loyalty.

Source: NPS Prism US Grocery Survey Q1 2023