Quebecers’ consumption habits have changed a lot in recent years, particularly due to the COVID-19 crisis and widespread adoption of new technology, such as smartphones and social networks. To keep pace, a new way of serving customers is needed.
Consumers are profoundly changing
Trying new brands, buying online, giving preference to buying local, choosing companies that share one’s values—the pandemic has had many effects on consumers in Quebec and around the world.
E-commerce has experienced an upswing since the pandemic, especially in the early days, when businesses were sometimes impossible to visit in-person. This temporary restriction has had a long-term impact. According to a study by consulting firm EY, 37% of consumers now buy online products they used to get in-store. According to the same firm, 63% of consumers also believe that the new habits they acquired during the pandemic, such as online shopping, will now be a permanent part of their normal behaviour.
The pandemic was also an opportunity for many people to understand the importance of buying local. According to a study by consulting firm Accenture, 55% of consumers claim they are now motivated to buy products that are local and sustainable. For many of these consumers, the past two years have highlighted the fragility of supply chains and the importance of relying on local businesses and manufacturers.
Consumers are also increasingly making purchases in line with their beliefs. According to a study by payment company PayBright, 57% of those under 35 refuse to do business with a brand that does not espouse the same values as they do.
Having learned to live with less during the pandemic, many people also intend to consume better instead of more. To this end, 59% of consumers spend more time considering making a purchase than before the pandemic, according to EY. The inflation seen in recent months will likely exacerbate this trend.
But obviously it’s not just the COVID-19 pandemic that has affected consumers in recent years. Technology such as smartphones and social networks have also left their mark on purchase habits.
Researchers generally divide the purchase process into five stages: identifying a need, searching for information, evaluating alternative solutions, purchasing, and post-purchase evaluation. At each stage, the impact of technology is obvious.
Targeted ads on Instagram, for example, allow consumers to discover new products as soon as they’re launched, items from competing companies can be quickly compared on their phone, whether online or in-store, and the post-purchase evaluation can now have even bigger repercussions than before, given a dissatisfied customer can turn to social networks to air their grievances.
Technology is transforming consumers. That was true before the pandemic, but it’s even more true since that event, now that many people have become more familiar with new ways of shopping and making purchases.
The importance of adaptation
Unfortunately, companies often have a hard time adapting to these new realities. Amongst the managers surveyed by Accenture for its study The Human Paradox, 88% believe their customers are changing faster than their companies can keep pace with. And customers are noticing, since 64% state they would like companies to adapt more quickly to their needs.
So what do consumers do when a company just isn’t keeping up? They go elsewhere. In 2021 alone, 26% of consumers stopped using or buying a brand, according to a study of consumer loyalty by consulting firm PwC.
According to a Forbes study, 83% of managers believe their revenue and share of market are on the line due to insufficiently improved customer experience.
How to adapt to new customers
Companies that don’t want to get sucked under by these changes must adopt a new approach to customers, one where the consumer is the focus of the company’s strategy.
Instead of fulfilling its own needs, a company focused on customers must first and foremost resolve its customers’ problems. In a customer-focused strategy, for example, the customer satisfaction score (CSAT) might be more important than gross sales or growth, since it increases the chances of keeping customers in the long term.
To respond to their current customers’ needs, companies must fulfill their expectations (or even exceed them) at every stage of a transaction.
How to achieve this goal will vary depending on the company and industry. But in every situation, it may be helpful to remember the five stages of the purchase journey in order to find the places where customer experience can be improved.
Identifying a need: Targeted, relevant ad campaigns enable you to reach both current customers and those of your competitors.
Search for information: It’s not enough to promote a price or your brand. You need to explain why customers can trust your business.
Evaluation of alternative solutions: Your customers will compare your products with those of your competitors. You should perform this comparison too and ensure your offer holds up to scrutiny.
Purchase: Transactions must be as easy as possible, whether in-person or online, no matter what platform is used (computer, phone, etc.).
Post-purchase evaluation: A customer-focused strategy means you must satisfy your customers during every stage of the transaction, including post-purchase. According to a study by PayBright, 70% of consumers expect to be able to return a product by mail for free. Even if the product doesn’t meet their expectations, easy and free returns mean the customer will continue to trust your business in the future.
Consumers have changed a lot with the advent of new technologies as well as the pandemic. Adapting your company by adopting an improved customer approach will allow you to take advantage of these changes.