Evan Schuman's StorefrontBacktalk

When the $7.3 billion Hy-Vee regional grocery chain on Monday (Jan. 23) rolled out its in-store mobile app, it encouraged customers to use Twitter to report out-of-stock items. At a glance, it may seem like a mom-and-apple-pie move, a “let customers feel engaged in the store” happy dance. But it’s actually a wonderful move, acknowledging—and addressing—a communication hole that exists because of an outdated management structure.

In a typical chain store, what happens when a customer discovers a problem, be it an incorrect price label or an out-of-stock or expired product? It’s up to the customer to track down an associate and report it. What happens then? Usually nothing, because it’s quite unlikely it’s the primary responsibility of that employee to deal with that problem. If the customer really wants it resolved, it’s then a process of finding and waiting for a store manager and, perhaps, the chief store manager. They can assign the problem to the right person.

Very few customers will bother, and the problem continues until that manager—or the right employee—discovers it. A very small number of chains have made resolving such customer issues a priority—Trader Joe’s and Nordstrom’s are on that short list—and it’s not merely associate apathy. Associates take orders from their managers, and they can’t decide on the fly to resolve customer issues—other than perhaps “cleanup in aisle 5.”

To the associate, spilled tomato juice in aisle 5 is an issue recognizable as immediate. But less tangible problems—including the aforementioned out-of-stocks, pricing errors and expired products—are not seen as time-critical. In reality, of course, they are absolutely time-critical.

Social media use in retail has clearly moved into the experimental phase and with some very compelling initial benefits, such as Wal-Mart’s move last week to use Facebook to find new low-cost suppliers through a variant of crowd-sourcing. But what Hy-Vee has done is use Twitter to, in effect, do an end run around its associates. This does four things.

• First, it creates a mechanism for customer service to see these items and to quickly bring them to the attention of the store manager. (The customer no longer has to chase the manager. The chain does. Much better.)
• Second, it’s easy for the customer to do right away. The customer sees the item, has their mobile device in their hand with the store’s app launched, and can zap out a message in 30 seconds.
• Third, we have the CRM benefit. The store now knows something that the individual customer cares about. On an individual CRM-level, this can be a huge help in understanding that customer and targeting better offers for them. On an aggregated all-customer level, this reveals which issues really concern a lot of customers.
• Fourth, this is being done very publicly. The very nature of social media has a wonderful transparency to it. Not only does this make the customer taking the action feel good, but it makes lots of customers feel better about the store because the transparency—and the resulting embarrassment—makes the store look like it cares. That will make customers more likely to return and feel like they are being cared for.

There’s a footnote to this strategy, though. It will backfire aggressively if it’s not consistently followed up with action. Once the issue is posted for all customers (and all rivals, of course) to see that the egg aisle has lots of expired cartons on the shelf, customers will immediately be looking for that problem. Whether the message was posted two days ago or two minutes ago will make little difference. If a customer reads about that complaint and then sees it unresolved, those good feelings flip into bad. Granted, if it really is two minutes, customers might be lenient. But now that Hy-Vee has gone public with this idea, the chain needs to act on it quickly and continuously.

As a practical matter, that’s the real value of social media. It gets retailers to do what they should have been doing anyway. Not bad for a free Twitter account, no?