Challenges Of Predicting The Unpredictable
by Jairaj Jatar
How should marketers insulate themselves from sudden shocks? There is a revolution spreading across the business landscape. Across every industry customers are becoming more demanding and less loyal. There is a sea change occurring in terms of what satisfies customers and what keeps them coming back for more. What worked yesterday cannot be presumed to work today, and what satisfies well today almost assuredly will not satisfy tomorrow. The key trends noticed in the market can be encapsulated as:
* Refusing to pay prices presumably inflated by layers of middlemen
* Turning up their noses at sellers' limitations on delivery periods, warranties and payment standards
* Opting for generic or clone products instead of brand leaders
* Negotiating harder for the absolute best deal
But, this new world of change need not unsettle us, so long as we are willing to understand its demands and rethink our products and services and ways of coming to market. Today, the operative word in business is customer loyalty, which is defined as "an act of binding the customer - intellectually or emotionally - to a course of action." If a product or service meets buyer's needs at the first occasion, and is offered at a fair price, that buyer has compelling reasons to come back for more, in a quest for "value" that suits him.
Thus, loyalty is a combination of three crucial elements:
Product or Service quality: It deals with the
tangible aspects of product performance and service delivery.
Price: Simple! It's what the customer paid for the product or service.
Intellectual or emotional bonding: It involves the essence of how we choose to spend or time, money and effort.
Let us now evaluate what impact this buyer's revolution can have for individual businesses. Perhaps, it's best to start with what measures of yesteryear will have reduced impact in the future.
* Excellent quality alone is no longer a
differentiator.
* Low prices alone are not a differentiator.
* Excellent service alone is no longer a
differentiator.
* Customer satisfaction is passé.
The path for tackling unpredictability of the new information age is two-fold: 1] Knowing your customers, 2] Enticing them to stay with you.
Find out what the customer wants
The quest for reducing unpredictability thus lies in providing customers "value" and meeting their expectations. Ideally, we would like to offer a unique experience tailored to each customer. But, a more practical and effective approach is to define groups of customers who share similar expectations. Segmenting the market on the basis of needs and expectations, and choosing the segment to tackle, will be the starting point to reduce uncertainty in business.
Rushing in with one-size-fits-all
Imagine the situation faced by an automotive fuel retailer who launched a loyalty card for its customers. The card-based scheme was offered to every customer who entered its forecourts. The start was promising as many customers opted in. But it was quite clear after a few months that repeat usage of the scheme was half of what was expected. Instead, in the mistaken belief that all its customers would obviously prefer to participate in a scheme, the fuel retailer introduced uncertainty in its day-to-day business.
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