The “New consumer normal”
Do your customers behave differently than you’d hope and expect? Don’t simply label them as “fickle”, but instead recognize that they probably represent the “new consumer normal”; empowered by choice and rarely loyal to a given product or service.
The urge to dismiss those customers that aren’t doing the kind of business with you that you’d expect as “fickle” can be tempting. However it’s akin to burying your head in the sand, according to Bradley (Woody) Bendle, in a recent post. If customer behavior isn’t as you predicted, chances are that you simply aren’t meeting their needs in a way they expect.
“I feel the reason so many executives, and business owners call their customers fickle (besides a momentary lapse of judgment) is because the game has changed – and they still haven’t fully come to terms with this fact or what it actually means to them and their business. The game hasn’t changed temporarily; it has changed forever and we need to accept the fact that there is no such thing as things returning to normal.”
These changes driving consumer behavior are, according to Bradley:
- Market power has shifted away from businesses to the consumer, due to radical decreases in the costs associated with information and geography.
- The great recession has fundamentally changed the consumer mindset and has resulted in a “new normal” in consumer behavior.
The first point is supported by the fact that technology has empowered consumers in ways that never existed before. Google Shopper is a prime example, putting the power of price comparison in the hands of consumers, anywhere, anytime. Tied with the opportunities offered by social networks, “the power has truly shifted away from business to the technology-armed consumer.”
And the “New consumer normal” hinted at in point two has presented a fundamental challenge for businesses. Savvy, thrifty consumers demand that businesses adapt to their changing needs. In reviewing this new phenomenon in recent publications which he recommends, he identifies two key drivers to address the new consumer mindset:
- Deeply understand your customer’s needs
- Continually innovate
And the challenge is a stark one:
“Twenty and thirty years ago, process improvement and cost containment could make one a titan within their industry… Today, the only way to ensure your future success… is to deeply understanding your customer (and their needs), and by becoming more relevant to today’s, and tomorrow’s consumer through continuous innovation. That means you need to be changing (innovating) at a pace that is at least a half-a-step ahead of your market’s rate of change. If you aren’t trying to do this, you can be sure that someone else is.”
Source: “Your Consumers are Valuable – Not Fickle!” (Bradley Bendle a.k.a. @wbendle, Collective Brands, Inc.)
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