Walmart Customer Satisfaction Scores on the Rise

November 10, 2015, 6:19 PM UTC

Looks like those higher wages at Walmart (WMT) might be paying off.

The discount retailer has been grappling with making stores cleaner—Walmart U.S. CEO Greg Foran said recently that one-third of stores still get a failing grade—and improving its inventory management, efforts that require a motivated staff. Walmart is starting to make progress, according to a study published on Tuesday by Wall Street firm Cowen & Co. Earlier this year, Walmart announced wage increases for hundreds of thousands of workers.

Some 75% of customers in Cowen’s rolling survey of 2,506 shoppers in September said they were satisfied with the overall shopping experience, Walmart’s highest score since June 2013 on that front. On customer service, 60% of shoppers were satisfied, the best the retailer has fared in two years. This is welcome news for the retailer as the holiday season, which is already off to a bruising start, promises to be super-competitive.

Last month, Wal-Mart Stores CEO Doug McMillon said stores were the company’s biggest asset in winning customers in the e-commerce era, i.e. back from (AMZN). For decades, Walmart’s business model was based on no-frills stores that sold items at much lower prices than rivals. But as price competition has stiffened with Amazon and many others, Walmart is finding it has to make stores nicer to get people to shop there rather than order online. This holiday season, it will festoon stores with far more Christmas decorations and trot out more Santas. Walmart has also spent money on prettifying the areas of its stores where shoppers can pick up online orders.

For all the improvements, though, Walmart’s scores lag those of Target (TGT), where 80% of customers in the same Cowen survey said they were pleased overall (versus 75% at Walmart.) And Walmart’s scores are lowest among a group of shoppers the retailer is trying to win more business from: only 67% of shoppers who make more than $100,000 a year were pleased.

Still, after getting pummeled last month its diminished 2016 profit forecast, Walmart could use all the good news it can get these days.

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