According to a recent Reuters’ article UK consumers may give a surprise boost to a weak recovery. Kevin Daly, UK chief economist at Goldman Sachs is quoted as saying that 2012 ” was something of a perfect storm for real disposable income because of an unusual combination of relatively weak wages, weak employment growth, high inflation and tax increases.”
The firm predicts that “consumer spending will rise by 1.3 percent in 2012 after a drop of 1.2 percent last year, still weak compared to an average annual rise of 3.8 percent in the 10 years before 2008, but well above the 0.5 percent predicted by the government watchdog the Office for Budget Responsibility.”
However the article goes on to suggest that shoppers are becoming more thrifty and, in relation to holidays, it quotes Peter Long TUI Travel chief executive: “”No matter what their budget is, customers are increasingly looking for a holiday at a fixed price where they don’t have to worry about how much they’re spending,” Hence, I guess, why Tui launched the First Choice All-Inclusive product!
According to research published in November 2011 by the Institute of Customer Service 86% of consumers are taking more time to shop around, 76% research the best deals and almost half (47%) are willing to switch companies in the future. As a result, the report revealed that UK firms feared losing 10% of their customer base over the next three years, at a cost of almost two and quarter billion pounds.
As cash–strapped customers spend less and shop around more amid continuing economic turmoil, business leaders warn of an impending war for customers and identify customer retention and acquisition as critical to success.
There might be a hint of recovery then but the fight is far from over for battle-weary companies. If there was ever a time to put your customer at the heart of the operation it is now. A customer-centric, customer-driven, organisation starts with the needs of the customer and builds products and services that best meet those needs generating a demand pull. More than that, the customer-centric company, through its voice of the customer programme, co-creates value with its customers; so that while price remains an important factor in the buying process, it is not the only one. This co-creation is achieved when a company and its customers are engaged in a mutually beneficial relationship. It becomes personal.
As you focus on the customer’s experience rather than yours the fight for new customers ceases to be a battle. This strategy attracts customers who want to do business with you. They become engaged, and loyal and, ultimately, they become advocates of the company.