consumer behavior

Impact of the Recession on Customer Loyalty

by

Impact of the Recession on Customer Loyalty

Impact of the Recession on Customer Loyalty

Many business owners and managers will tell you that they are struggling to maintain market share and service levels to guarantee customer loyalty. This has been a trend for a number of years and particularly became difficult once the recent economic downturn kicked into full swing. To off-set the trend, companies are striving to provide excellent customer service, create moments of truth that make the customer feel special and encouraging customer service representatives and employees at all levels to exceed customer expectations.

A big challenge is that companies realized that in addition to losing customers, they were also losing profits as many middle class and some higher-income customers retrenched on spending. To offset their reduced disposable capital, consumers have changed their spending habits, stopped eating out and traveling as much, limited their entertainment budget, shopped less for non-essential items, and cut services that they considered a luxury (e.g. grass, pool, and pest control services) and started handling those functions personally. They also started doing more comparative shopping, spent more time bargain hunting, attended yard sales and consignment shops, clipped more coupons, and in many instances traded down to less expensive store items or those that were not in the “status symbol” or name brand categories.

The result of all these cultural and societal changes has been that now that customers are accustomed to the “new economic normal.” They realize that they can actually live well and be comfortable at a lower spending level and using lower quality products. They even realize that in many instances they actually happy with their new lifestyle and spending habits. As a result, even though the economy has started a slow upward movement, consumers are now remembering the economic pain they suffered and are stashing away as much as they can in the event the recession comes back.

What all this means for retail businesses,  service providers and product manufacturers are that they must retool their marketing and production mentality. They are reducing on-hand inventories, minimizing staff hiring and using part-time employees or outsourcing services and re-examining the way they deliver customer service in a changing world. In particular, they are changing the manner in which they show added value to their customers in an effort to gain and retain new ones.

The changing business environment has resulted in a winning proposition for many consumers who now feel that they are in a power position related to making purchases. This is especially true in instances of major buying decisions (e.g. cars, houses, property, recreational vehicles, and other higher-end items).  Many realtors and dealers have experienced a large inventory surplus due to a slowdown in purchases and tightened lending policies from financial institutions. This has created a buyers market.

By doing adequate research and coming to the sales environment with knowledge of manufacturing costs, competitive pricing, and product and service details, the consumer is now often in a position to negotiate strongly and get pricing that is not only fair but also better than they could have gotten in the past. Retailers in nearly every type of product line and business are willing to negotiate and offer discounted prices when pressured by the customer to do so. They do this because they realize that their competitors will discount if they do not and the customer is likely to walk away, if not satisfied with an offer they receive. In addition, with a global economy and access to products from around the world only a mouse click away, companies realize that they must deal or die.

Impact of the Recession on Customer Loyalty

From a customer service perspective, it is imperative that managers develop a customer-centric mindset and that customer service representatives and everyone else in the organization adopt a can-do/must-do attitude when it comes to communicating effectively and working with customers. They must provide the best customer service possible in any instance where there is a of customer-provider interaction. Only through such initiatives will organizations be able to show customers that they offer the best value, care about their wants, needs, and expectations,  and are willing to put forth the effort to help achieve customer and brand loyalty.

About Robert W. Lucas

Bob Lucas has been a trainer, presenter, customer service expert, and adult educator for over four decades. He has written hundreds of articles on training, writing, self-publishing, and workplace learning skills and issues. He is also an award-winning author who has written thirty-seven books on topics such as, writing, relationships, customer service, brain-based learning, and creative training strategies, interpersonal communication, diversity, and supervisory skills. Additionally, he has contributed articles, chapters, and activities to eighteen compilation books. Bob retired from the U.S. Marine Corps in 1991 after twenty-two years of active and reserve service.

Make Money Writing Books: Proven Profit Making Strategies for Authors by Robert W. Lucas at Amazon.com.

The key to successfully making money as an author and/or self-publisher is to brand yourself and your company and to make yourself and your book(s) a household name. Part of this is face-to-face interaction with people at trade shows, library events, book readings, book store signings, blogging or guest blogging on a topic related to their book(s). Another strategy involves writing articles and other materials that show up online and are found when people search for a given topic related to a topic about which the author has written.

If you need help building an author platform, branding yourself and your book(s) or generating recognition for what you do, Make Money Writing Books will help. Bob’s popular book addresses a multitude of ideas and strategies that you can use to help sell more books and create residual and passive income streams. The tips outlined in the book are focused to help authors but apply to virtually any professional trying to increase personal and product recognition and visibility.

Impact of Demographics on Consumer Spending

by

The Impact of Demographics on Consumer Spending

Impact of Demographics on Consumer Spending

The world is shrinking as millions of consumers from various cultures and demographic backgrounds come together. In an age of lightning-fast technology and the ability to get onto a plane in the morning and be in another country within twenty-four hours, the likelihood that a customer service representative will deal with someone from a different background who looks, sounds and thinks differently from them is almost a given. With these encounters comes huge revenue generation opportunities, but also big challenges in how to effectively provide service to individuals from various backgrounds.

Like many parts of the developed world, consumer behavior and the overall buying power of various ethnic groups in the United States has grown. According to one study done by The University of Georgia’s Selig Center shows that “…Over the 19-year period (1990-2008), the percentage gains in minority buying power vary consider­ably by race, from a gain of 337 percent for Asians to 213 percent for American Indians to 187 percent for blacks. All of these target markets will grow much faster than the white market, where buying power will increase by 139 percent.”

Other sources contend that women are also a force to be reckoned with in the retail environment. Female consumers account for a majority of buying decisions on consumer products and services in many areas, including everything from automobiles to healthcare. Many of the increases described are due to more representation of these groups in the workplace and at higher levels (e.g. management), higher education levels and better access to workplace opportunities for minorities (e.g. training, promotions, and transfers).

Various diverse groups are also having a major impact on global markets, especially in the United States where a report on http://www.marketingresearch.com “…estimated the buying power of gays and lesbians exceed $835 billion and projected the gay and lesbian population to exceed 16.3 million people by 2011.” In addition, people with disabilities spend billions of dollars on goods and services. Some estimates for online spending by this group alone top $10 billion dollars a year.

Add to the numbers you just read the demographic of the newest generation of shoppers – Generation Y (also known as Millennials, teens, Tweeners, and Twenty-Somethings) born between 1978 and 2000 with nearly eighty-four million members in the United States alone. According to Kit Yarrow and Jayne O’Donnell in their eye-opening book Gen Buy: How Tweens, Teens, and Twenty-Somethings Are Revolutionizing Retail, this demographic group spends over $200 billion dollars a year and it is estimated that in their lifetime, their consumption will top $10 trillion dollars.

Obviously the recession slowed the number of sales being made worldwide.  Even so, with the types of economic power being wielded by various ethnic, age and other diverse groups, service providers should plan accordingly and be prepared to meet the needs of each group of customers.

What this means is that by gaining knowledge about values, beliefs, motivators, history and other factors that can influence someone’s behavior and perceptions, especially related to those of different diverse categories, you can better prepare to serve them. For example, there is a potential for distrust when some people of different cultures or groups with a history of negative relations (e.g. Caucasian and African-American or North American Indian, Chinese and Japanese, Israeli and Palestinian, Christian and Muslim) come together. As a service provider, if you are aware of potential negative perceptions, you might modify your approach to providing service in a given situation.

For more information and suggested strategies for serving a global customer base, get a copy of Please Every Customer: Delivering Stellar Customer Service Across Cultures.

Who is Robert C. Lucas?

Bob Lucas has been a trainer, presenter, customer service expert, and adult educator for over four decades. He has written hundreds of articles on training, writing, self-publishing, and workplace learning skills and issues. He is also an award-winning author who has written thirty-seven books on topics such as, writing, relationships, customer service, brain-based learning, and creative training strategies, interpersonal communication, diversity, and supervisory skills. Additionally, he has contributed articles, chapters, and activities to eighteen compilation books. Bob retired from the U.S. Marine Corps in 1991 after twenty-two years of active and reserve service.

Make Money Writing Books: Proven Profit Making Strategies for Authors by Robert W. Lucas at Amazon.com.

The key to successfully making money as an author and/or self-publisher is to brand yourself and your company and to make yourself and your book(s) a household name. Part of this is face-to-face interaction with people at trade shows, library events, book readings, book store signings, blogging or guest blogging on a topic related to their book(s). Another strategy involves writing articles and other materials that show up online and are found when people search for a given topic related to a topic about which the author has written.

If you need help building an author platform, branding yourself and your book(s) or generating recognition for what you do, Make Money Writing Books will help. Bob’s popular book addresses a multitude of ideas and strategies that you can use to help sell more books and create residual and passive income streams. The tips outlined in the book are focused to help authors but apply to virtually any professional trying to increase personal and product recognition and visibility.

Thanks for visiting our website!  If you need or want a copy of this content - please contact the author to request purchasing it. Thank you!