Our objective was to evaluate key factors affecting the customer experience at Postal Service retail units and identify opportunities to enhance the overall customer experience.
The Postal Service’s vast number of post offices is the largest retail network in the country, spanning more than 30,000 Postal Service-managed retail spaces. These offices drew over 857 million retail customers and generated about $9.7 billion (14 percent) of the Postal Service’s $69.6 billion operating revenue in fiscal year (FY) 2017. Research consistently shows that focusing on the customer experience is a successful growth strategy, as companies with loyal customers grow more profitably through their existing customer base than do companies focusing primarily on trying to recruit new customers.
A joint study by the Verde Group, Wharton School’s Jay H. Baker Retailing Initiative, and the Retail Council of Canada identified five key factors that contribute to a positive retail customer experience:
- Engagement: Being polite, genuinely caring, and showing an interest in helping customers by acknowledging and listening.
- Executional Excellence: Patiently explaining and advising, checking stock, helping find products, and having product knowledge.
- Brand Experience: Maintaining an exciting store design and atmosphere, consistently providing great product quality, and making customers feel they are connected to the products and services offered.
- Expediting: Being sensitive to customers’ time in long check-out lines and proactive in helping to expedite the shopping process.
- Problem Recovery: Helping resolve and compensate for problems, upgrading quality, and ensuring complete satisfaction.
This audit expands on retail customer service data the Postal Service collects through customer surveys and mystery shoppers to identify root causes and corrective actions that could improve postal customers’ overall retail experience.
What the OIG Found
The Postal Service has opportunities to enhance customer satisfaction in each of the five factor areas affecting customer experience. Our auditors visited 136 retail units nationwide as customers, based on a statistical sample. We were dissatisfied with our overall experience at 32 of them (or 24 percent). Based on these results, we estimate customers at about one in four retail units across the country would have negative experiences. We also found that customers would be more likely to have positive experiences at retail units in rural areas rather than those in urban areas.
We attributed our overall dissatisfaction at the 32 retail units to the absence of one or more of the five key factors to a positive retail customer experience. The factors most frequently missing were executional excellence, concerns with brand experience, and problems engaging with employees.
The top reasons for our overall positive experiences at 94 of the retail units (69 percent) included friendly and knowledgeable retail associates who could complete our transactions and facility cleanliness. We had neutral experiences at the remaining 10 post offices (7 percent), which were mainly driven by interactions with the retail associate. Specifically, the retail associate was able to salvage a negative experience we had entering the facility, or the associate negatively impacted an otherwise positive experience.
In addition to visiting the 136 retail units, we reviewed results of the Postal Service’s Retail Customer Experience (RCE) program. Under the program, mystery shoppers evaluate the customer experience at about a quarter (7,500) of all retail units. The RCE program uses a 100-point scale to evaluate each office. The average overall score for RCE in FY 2017 was 93 out of 100. Unlike the RCE program, the site visits in our audit represented all retail units. Instead of using points like the RCE program, we evaluated units using the five key customer service factors, weighted evenly, under the premise that a negative experience with any of the factors could lead to dissatisfaction.
We also analyzed the results of a FY 2017 OIG customer survey, studied social media reviews for 205 randomly selected post offices, and evaluated FY 2017 Postal Service point-of-service survey results. The additional analyses revealed issues similar to the ones we experienced during our visits in the key factors affecting retail customer experience:
- Engagement: Customers’ positive or negative engagement with retail associates was a pivotal factor in their overall customer retail experiences. At 16 of the units we visited (12 percent), the retail associate did not greet us in a friendly manner, maintain a positive demeanor, or use a polite tone of voice.
- Executional Excellence: Retail associates at 24 of the units we visited (18 percent) did not provide useful information about our transactions or inquiries. On social media, issues related to executional excellence was the primary driver of negative reviews.
- Brand Experience: We observed facility maintenance concerns at 35 of the units we visited (26 percent). Positive customer comments from point-of-service surveys indicated that the cleanliness of the post office influenced their overall satisfaction.
- Expediting: We waited in line over five minutes at eight of the sites we visited (6 percent) and more than 10 minutes at three of the units we visited. Customers on social media also reported excessive wait times.
- Problem Recovery: We were unable to contact seven of the units we visited (5 percent) via telephone using the numbers posted on usps.com. We also experienced an ongoing issue trying to redeem a money order after a retail associate misprinted the date. Resolving the problem took several weeks and many communications, which created frustration and negative sentiment toward the post office.
Customers had negative experiences at post offices because management has not established a culture heavily focused on customer service at all retail units. For example, retail associates are awarded their positions based on seniority, rather than their interpersonal or customer service skills, and most are not required to take annual customer service training. In addition, because the National Performance Assessment does not emphasize customer experience-related metrics, customer survey results account for a small portion (up to 3.5 percent) of the retail unit’s total score.
Providing a negative customer experience affects the likelihood of an individual returning to a retail unit, as well as their decision to use the Postal Service for higher-revenue, business needs. A lack of organization-wide focus on retail customer experience could negatively impact the Postal Service’s brand, customer retention, and revenue.
What the OIG Recommended
We recommended Postal Service management re-evaluate the proportion of a unit’s National Performance Assessment score directly attributable to retail customer service, take steps to cultivate a stronger retail customer service culture by integrating customer-focused practices into daily operations, develop and provide annual customer service training for all retail associates, and benchmark with organizations known for their retail customer experience and determine the feasibility of the Postal Service customizing these practices.