Technology is the leading driver of change globally.
It is driving swift change in various areas of our lives from how we work to how we spend our time at home.
Nearly everything in our world is driven by technology.
Whether it is healthcare, mobility, work or entertainment, in every area, technology has brought enormous changes to how we live and spend our time.
Everyday consumers around the world use apps and websites to avail of various products and services.
It would not be wrong to say that digital technology has become our way of life.
Technological advancements have changed our lifestyles and way of living forever.
Social media, Netflix, YouTube, Snapchat, Online shopping, all these are now part and parcel of our lives.
It was not so a few decades ago.
Technology has changed us a lot and as individual consumers, our decision making and consumption patterns are affected to a large extent by technology.
From what to buy to how and where to buy, and which options to consider, technology plays a major role in affecting consumer behavior and buyer decision making process across the entire world.
As businesses have come to recognize the role of consumers in terms of business growth and success, they are investing heavily in customer experience across all touchpoints including physical and digital.
With the growing role and impact of digital technology in our daily lives, businesses now know that digital and digitalization are essential for market expansion and growth.
Here are some important facts that businesses and managers need to be aware of considering how digital technology is changing consumer behavior around the world.
Businesses are operating in a highly competitive environment.
Technology has driven major changes industry-wide including higher competition for each customer and a higher need to focus on data and analytics to grow customer engagement and for providing a superior customer experience.
Businesses need to focus on the overall impact of technology in terms of consumer behavior so that they can engage customers across all touchpoints and drive higher customer satisfaction.
There is an intricate relationship between technology and consumer behavior. Businesses need to be aware of this relationship so they can adopt operating models which help them become more successful and customers’ favorites.
Digital is the new norm:-
Digital is the new normal.
Consumers around the world use the internet and smartphones to research products, grow their level of awareness of the latest and stay abreast of the changes that impact their lives.
Their lives have grown highly digitalized.
The millennials and the GenZ, which now form the largest target market for a large number of businesses across the entire world, are the most tech savvy generations.
They have grown up with technology and spend a lot of their daily time on the internet.
Since they have grown up with digital technology and are among the leading users of digital technology, it is impossible to imagine their lives without digital technology.
These consumers spend their entire day living digital lives.
So, doing without digital is impossible for businesses.
Every business needs to have a digital strategy if it wants to grow and attract a higher number of customers.
Customers have higher expectations from businesses:
Technology has changed several things in this world including consumers’ expectations from business regarding level of service, speed of service, customer convenience and quality among other things.
Technology has led to growth in the level of competition among businesses industrywide.
It has helped businesses raise the bar in various areas.
Big tech like Amazon, Apple, Facebook, Google and Netflix are investing in technological innovation to continuously raise the bar and provide their customers with superior quality products and services.
Technology has also helped these businesses continuously raise the bar in terms of customer experience.
Consumers want businesses to be more responsive across all channels and provide more personalized and targeted communication and services.
Long ago, customer service hours used to be fixed and customers had to wait till then before they could receive help from a customer service agent.
Now, this has changed and businesses know that customers are not willing to wait.
They want customer service to be available round the clock whenever they need it.
Most well known businesses, especially the online service providers have customer service departments that provide support round the clock to the customers through several touch points including online chat, automated customer support like chatbots, email, phone and other channels.
Instead of having a small team of customer service reps, companies have large teams devoted to the job so that they can handle customer requests whenever required along all channels.
They know that the slightest delay or the slightest discrepancy in terms of quality of customer service can leave the customer dissatisfied which will in turn hurt brand image and sales.
The same is true in terms of marketing since consumers want more targeted communication from businesses.
So, businesses need to be alert about the communication happening with customers across various channels and making it as consistent as possible.
A bad customer experience means that the same customer will not return to make repeat purchases from that business.
The bargaining power of customers has increased as they have more information and higher control in their hands.
A bad customer experience also results in poor word of mouth and can hurt brand image faster than expected.
Customers are using multiple devices and channels:
Now, the customers are more connected than ever.
The number of smartphone users across the planet has grown.
More and more people are using multiple devices including smartphones, tablets, PCs and laptops as well as wearables.
The number of smartphone users across the world in 2021 has grown to 6.38 billion from 3.67 billion in 2016 according to Statista.
That is a staggering number and shows how the number of smartphone users has exploded in just five years.
Mostly people use smartphones to avail of online services, online shopping and for entertainment.
Mobile shopping trends have grown fast during the pandemic as more and more people were ordering from their homes.
People need to stay connected throughout the day and they use their smartphones for many tasks including communication and for their personal and professional needs.
They use multiple channels for shopping including physical and digital channels.
For example, you can order products from Walmart like you do from Amazon and receive them at your doorstep.
You can also place an order on Walmart’s website or through its app and then pick up your order from the nearest pickup location.
As customers are using multiple devices and channels, businesses are also reverting to a multichannel strategy and reaching out to their customers through their websites, apps, social media, email and other channels.
Email marketing and social media marketing are commonly used across various industries.
A customer sees an ad on television or in a magazine and then starts researching the product online using his smartphone or laptop.
He might place the order through his laptop or smartphone or simply visit the nearest store.
So, it is difficult to predict the channel a customer might use to complete his purchase.
Businesses remain ready with the right messages across all customer touch points so that they can provide the right product and the right support at the right time.
They need to use data and analytics to serve the right customer at the right place and at the right time and to bring more personalized and tailored options that suit the customer.
Level of consumer awareness is higher:
The level of consumer awareness of brands and products has grown with time.
Customers have all the information they need to evaluate a product and make the right buying decision.
Suppose you see an ad for a new product on television and start researching about the product on your smartphone or laptop.
In no time you have all the information you need including pricing, product attributes, differentiating features, answers to your quality and warranty related queries and other information you need before making a final decision.
Consumers use several channels to learn more about a product or brand before buying the product.
Apart from it, the brand image also plays a critical role in helping the consumer make a decision.
Customers generally use websites, blogs, social media and other channels to gather the information they need.
They also compare prices along various channels like Amazon and other websites.
They evaluate and compare products and their substitutes for quality, pricing and other attributes before buying.
Since the level of consumer awareness has grown, businesses focus more on building a strong brand image, growing brand awareness and their pricing strategy to attract and retain more customers.
You cannot expect a customer to stick to your brand because brand switching is now very common and easy.
Customers will switch to another brand if they are not satisfied with your product, quality or service.
Businesses use various channels to grow consumers’ awareness of their brand including online advertising, social media advertising, in store promotions, and other growth or marketing strategies.
Building higher awareness helps businesses overcome the competitive pressure.
Customer experience matters more than ever:
One important factor that has become critical to winning in a highly competitive industry environment is customer experience.
All the leading brands across various industry sectors focus heavily on customer experience since it is the most critical factor for customer retention and building loyalty.
Attracting and retaining customers does not just depend on product quality and pricing strategy. Instead the focus has to be on all marketing, sales and service channels to offer the best customer experience.
Customer experience is a distinguishing feature that helps businesses differentiate themselves from the rivals.
Take Nike or Starbucks for example.
These businesses are known for product quality but they are also known for the customer experience they offer.
That’s what distinguishes them from the other brands offering comparable products and services.
This is also the reason that brands like Apple, Nike or Starbucks enjoy stronger loyalty compared to others.
Investing in customer experience is always worth it and a superior customer experience helps businesses strengthen their competitive advantage
Customers do not go to Domino’s, McDonald’s or Starbucks only for food or beverages but they are there for the distinct and superior customer experience they offer.
It is why businesses like these are market leaders and enjoy a superior competitive position and higher brand loyalty.
Customers have access to more substitutes:
It is the era of fierce competition.
Industrywide there is no single brand that is not dealing with a very high level of competition.
From Apple to Netflix, Nike and even Google, all are dealing with strong competition.
Brands always have several substitutes and they can switch to another brand easily if they are not satisfied with a particular brand.
Technology has created a lot of growth but it has also given rise to higher competition.
While technology is a source of competitive advantage for most brands industry wide, it is also the main reason that competition has grown so fierce.
Customers do not need to look very far to find a substitute.
They can always pick up their smartphones and search for similar products and services.
Across each and every industry from the tech industry to smartphones and automobiles, customers have lots of substitutes to select from.
They can always switch to another smartphone or fast food brand.
It is why businesses need to focus on each and every aspect from marketing to sales, supply chain, customer service and manufacturing to maintain quality and customer loyalty.