Since mid-March, McKinsey & Company has been conducting a series of “Consumer Sentiment” studies in an effort to track the impact of COVID-19 on buyer needs, expectations, and attitudes.
When their most recent results were reported a few weeks ago, I couldn’t help noticing some interesting parallels between their findings and those of Shep Hyken’s 2020 ACA “Achieving Customer Amazement” (ACA) Survey.
Each study frames their questions and their reporting quite differently. (Hyken’s ACA report doesn’t even mention the current pandemic, for example.) Yet, they both give us a glimpse into what’s at stake for today’s consumer – and for the organizations who wish very much to keep their business. According to McKinsey, the pandemic has had 5 primary effects on consumer behavior that are likely to endure long after COVID-19, suggesting they’re part of a “new normal” in consumer priorities and behaviors. Each is echoed in the findings of the ACA.
- Brand loyalty is very much up in the air: most American consumers are shifting their spending to “essentials” according to how they perceive and seek “value.”
According to McKinsey, the majority of American consumers now believe that COVID-19’s impact on their finances and routines will last “beyond the next four months.” This belief has forced them to evaluate how and where they spend their money – and to spend it more carefully. That’s not so easy these days. As McKinsey also points out, consumers are struggling with limited access to what they consider essential – and more than 75% of consumers are making big changes to their own shopping behaviors. In their search for value, they are experimenting with new brands. Not surprisingly, Hyken’s ACA study found that fully 96% of consumers voiced willingness to switch brands if they experience “bad service.”
- Consumers are fleeing to omnichannel and intend to stay there
Not surprisingly, more and more consumers are shopping online and seeking assistance through omnichannel customer care. According to McKinsey, most brand categories have seen a 15-40% increase in growth of online channel users. It makes sense then that consumer perceptions of a brand’s value are now shaped increasingly by the brand’s ability to deliver a superior omnichannel customer experience – and less so by in-person experiences. Consider that sobering fact alongside another one: the ACA study reports that across all industries, 38% of brands fell short of customer expectations.
- What consumers value is changing dramatically: Protecting Health and Feeling Cared About are now top priorities
McKinsey respondents say they’re paying close attention to how brands invest in safety measures to protect them – but also to protect their own employees. Fully one fourth of consumers report that they’re paying attention to how company’s treat their own employees and factor that into their own buying choices.
- We are in a Homebody Economy: Home is Perceived as Safe
Yes, we are seeing a great deal of back and forth when it comes to parts of the country re-open, scale back, and re-open with adjustments. But through it all, 70% of McKinsey respondents say they’re simply not comfortable returning to the activities outside their home that were once their “normal.” They are waiting, watching, hoping for trusted authorities to provide them with reassurances that enough safety measures are in place before they venture too far back out of their homes. Again, this finding, for me, reinforces the extreme importance that today’s consumers are placing on the need to feel safe, to feel cared about, and feel trust. Hyken describes today’s consumer preferences like this: “the customer decides if you meet and/or exceed their expectations” and he raises this critical question: you may think you deliver great service – but …
- You’re not just competing within your own industry anymore.
Hyken points out that, when you consider consumers’ growing sophistication and access to information – alongside their shifting concerns and eagerness to seek out better, higher value brands – your customers aren’t measuring you against other players in your industry. They’re evaluating your performance based on the best experiences they’ve had anywhere. So, when is the last time you asked your customers what they need most now? Critically, how successfully are you showing your customers that you care about their well-being – and you protect the well-being of your own employees?
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