Preparing for the new consumer
Customers have been forever changed by the coronavirus. Here’s what businesses can do now to connect
5 minute read
- Consumers have adapted quickly to new ways of buying goods and interacting with businesses
- Moving forward, consumers will spend less time in buildings and make fewer impulse purchases
- Technology gives businesses a stronger toolbox to connect authentically with their customers
Though the pandemic will surely end, the changes it has brought to consumers, their buying habits and the businesses that depend on them will endure. “The world has changed profoundly and forever,” says Lou Paskalis, Senior Vice President, Customer Engagement and Media Investment for Bank of America.
As former chairman of the Mobile Marketing Association, Paskalis has unique insight into consumers’ evolving needs and preferences. Here, he shares ideas on how consumers have changed, what’s ahead and why companies that take steps to enhance their online presence may emerge stronger than before.
What are consumers doing differently in light of the coronavirus?
Online searches are up about 30% since the pandemic began, and consumers have adapted very quickly to new ways of buying goods online and interacting with businesses through all manner of connected devices. Even companies that thought they were immune to the digital revolution need to understand that this experience will forever change the way customers interact with them. Traditional in-person sales, trade shows and store floors won’t go away entirely, but they’ll be less important than they were before the pandemic. That’s going to require some big adjustments for many companies. Yet every challenge creates opportunity.
What new buying behaviors are you seeing?
Consumers have shown they’re willing to shop online in ways that seem counterintuitive. For example, buying cars has always been a “give it a drive and kick the tires” experience. Now, dealers are enabling customers to select a model online, deliver the vehicle of their choice to their homes and let them return it if they decide they don’t like it. Another trend is buyers shopping for things online and picking them up in person — there’s even an acronym for this: BOPIS (Buy Online, Pickup In Store). Say it’s Saturday and you have a do-it-yourself project in mind. You select the item online and then swing by the home improvement store to pick it up. While these trends are driven by the desire to maintain distance during the pandemic, they will likely reshape how consumers interact with businesses moving forward, spending less time in physical buildings and reducing impulse-driven sales as a result.
How should businesses respond and adapt?
A time when consumers aren’t buying as much is a good time to test new approaches because less is at risk.
You don’t need to abandon traditional in-person meetings and sales, but maybe now those become more of the exception and you build your business around new digital opportunities that enable virtual interaction at greater scale.
You might start by taking a particular product or service that already has built-in demand and a steady, reliable customer base. Experiment with a digital-only engagement strategy for the next 12 months, marketing online and encouraging customers to experience and evaluate the product and interact with you through online and mobile device-enabled demonstrations. The first three or four months you may lose some sales as you experiment with what works best for your business. But that’s okay, because what you’re talking about is moving from a transaction model to a relationship model, where the relationship is online rather than in person. By months five and six, you may find you gain momentum and sales leads, as people who have had positive online experiences become some of your best buyers. Ultimately, this approach may reduce your cost of sales and even improve your customer retention rates as you adapt your sales model to a service model and proactively engage your customers when your data shows they might be in the market for an updated product from you.
How can companies accustomed to face-to-face interactions build relationships online?
Technology has given every business a stronger toolbox to connect authentically with their community and demonstrate what I call “JNDs” — just noticeable differences. In a competitive world, JNDs are the things that tell customers what makes your product, ethos or philosophy different from your competitors’. It’s not about hunting for new customers, it’s about cultivating them and giving them reasons to believe that your company and products are different/better/reflect their values.
Say, for example, you manufacture precision instruments. You might consider creating webinars describing how your machines are designed and what they do that’s different. Feature your experts — not marketing or sales people, but your engineers or people on the production line who actually designed the solution. Spread the word about your webinar with an email campaign targeting your existing customers, trade associations and other potential customers. Instead of customers seeing a 30-second TV commercial or a print ad in a trade journal, they get to spend an hour and a half with your expert, who can give thoughtful answers to their most detailed questions. That is a low-cost way to create a valuable, authentic experience and build relationships that doesn’t rely on expensive trade-show strategies or in-person consultations.
Why is it important to tell customers about your philosophy and ethos?
Consumers in all age groups are taking a stronger interest in the values of the companies they do business with. They want to know what you care about as a company — for example, your philosophy on climate change and other environmental, social and governance issues. If you’ve made a $25,000 contribution to an environmental organization, you should talk about that as part of your customer engagement strategy. At a time of uncertainty, people aren’t just looking for rational benefits but for emotional reasons to believe that your company cares about our collective future.
- Consumer trends
- Customer relationship management
Lou Paskalis, Senior Vice President, Customer Engagement and Media Investment for Bank of America