Customer satisfaction top U.S. issue in 2008: survey

By Martinne Geller

NEW YORK (Reuters) - Satisfying increasingly demanding consumers is expected to be U.S. retailers' top priority this year, according to a survey released on Tuesday by International Business Machines Corp and the National Retail Federation.

Focusing on the customer always ranks high, but this is the first time in several years it is projected to be the most important area, IBM said.

In discussing the survey's findings at the NRF's annual conference, an executive for department store chain Bon-Ton Stores Inc said the more intense focus was related to how different today's consumers are to prior generations.

"Our role is changing. The customer is changing. How they're getting information is changing," said Edward Carroll, Bon-Ton's executive vice president of sales promotion and marketing. "They're demanding more and obviously it becomes that much more important for us to figure out ways to satisfy them."

Carroll pointed to the prevalence of mobile phones and the Internet, which is how so many teenagers get their news now, instead of traditional mediums such as television or newspapers.

"Customers' expectations are increasing dramatically," said Jeffrey Marshall, the chief information officer of Kohl's Corp.

In recent years, the top priority was expanding the number of stores. But that is now tied for second place with cutting costs -- a concern as many retailers come out of the worst holiday shopping season in 5 years due to a consumer slowdown expected to last well into the new year.

The survey, conducted in the fall of 2007 by IBM and the retail industry trade group's research and education arm, known as the NRF Foundation, is based on responses of 418 executives from 137 companies across the retail industry.