Forget Demographics. Consumer Habits Rule.

Changing consumers

In an age where competitor benchmarking and industry analysis is commonplace, marketers often lose sight of what really matters. The customer.

In an interview with First Round Review, Dropbox’s Head of Design, Soleio Cuervo said “Remember that you’re not competing against other services. You’re competing against people’s habits.”.

He’s 100% right.

Customers have become brand agnostic. Today, consumers have their regular purchases that they make routinely, applications that aid them and brands that help them define who they are and what they stand for. A study by Deloitte found that consumers buy online primarily out of ease and convenience, the lack of fixed opening hours, and the fact that they do not need to carry the products home themselves – and this holds the crux of the modern consumer.

Brands continue to play an important role in the purchase process but blind commitment to individual brands has decreased. Modern consumers switch brands, experiment, and are open for inspiration in their aim to help . In future, the number of newly emerging niche products and brands will continue to increase. Only brands that focus on the customer relationship and not the products can expect loyal customers. All others will experience much tougher competition. For retailers, digital technologies give the opportunity to extend their range considerably and to test the sale of new brands online.

Smartphones – Assistance and distraction.

Smartphones not only act as shopping assistants, but also as a serious source of distraction. At present, mobile phones tend to divert attention from buying, and not supporting the purchase process. But even today, some consumers already use their mobile phone to make better purchase decisions or buy cheaper elsewhere. Presently, fewer than 10% of respondents now use their smartphones in stores in most retail sectors. These figures are much higher for consumer electronics and home improvement products. With the increasing penetration of smartphones, this is set to change in the future. High street retailers will gain a wealth of opportunities to sell, and to give information, navigation and help.

Social commerce: Friend to salesperson.

Brands are now also beginning to weave social media into the sales process. Facebook, Twitter and the like are fast becoming not only communication tools, but also sales channels. The idea of social media becoming the “eCRM on acid” that will change the digital landscape seems to be edging closer;  turning customer’s friends and acquaintances into affiliates to meet the growing need for personal guidance and orientation of the modern consumer. They thus gain quality and flexibility. They can personalize the shopping experience, make more relevant offers and require less staff. Initial approaches are pointing toward this development. Even today, users who tell their friends what they are buying or were become eligible for discounts. Twitter is being used actively for sales help and product announcements. Retailers use Facebook to identify customers at the start of the buying process, present personalized offers and deliver recommendations from their friends. The first online stores are opening within Facebook. And the key to the success of new players such as Groupon is that many consumers shop together.

From advertising space to involvement space.

The era in which physical retail outlets and e-commerce were separate and competing spheres is drawing to a close. In the future, consumers will buy in numerous physical locations and via a variety of physical media. The triumphant progress of touchscreen computers and smartphones is making this possible. Consumers will be able to browse and make purchases at display windows and outdoor advertising spaces. They can also use touchscreens to order products in stores or view more information. Tablet computers let sellers present products more effectively and sell them directly. A variety of new digital services will support this buying process via sensors. Orders are then delivered or are ready for collection in the store.

Static business models

While consumers are changing their habits at an unprecedented rate to better fit their connected and “busy” lives; most businesses are failing to adapt with them. Sure there are a few that are looking to make their operations more digital. But it is the companies that look to drive a wedge into people’s habits that are the ones that are truly out there disrupting things. Take a look at Uber, for example:

“You used to walk out to the street to flag a taxi down. Now with Uber you can book a taxi home from work using your smartphone.”

Successful tech companies are built on new habits they helped form around the utility they have provided. Google, Ebay and Netflix are all examples of great habit changing business models that have replaced their analog counterparts.

As you think about your product or service, always be thinking about what people currently do and how you can create a new set of habits around your business. After all, that’s what retention really is —assisting people to build a routine around your product offering.

[This post is a work in progress – I’ve previously written about my iterative approach to content if you like that sort of thing]

About the Author

Andrew Isidoro

Andrew has been working in marketing since the noughties across a spectrum of digital marketing roles from social media to content marketing to the technical world of search engine optimisation.