LOOKING AT CONSUMER TRENDS THAT WILL IMPACT RETAIL IN 2016 AND BEYOND
If you look back just five years, the rate of change in the way most business is conducted has been nothing short of amazing — and it’s not going to slow down.
Five years ago, SMS or text messaging was something of a novelty for many of us. Now, SMS has evolved to become a versatile and preferred means of dialogue.
Communication has become more visual, with technology allowing rich and emotive messages to be conveyed. And personalization in communication is a necessity, not a point of difference any more.
The year of 2016 is likely to bring changes in many areas, some of which will be more noticeable than others.
CONSUMER TRENDS
One of the world’s leading market intelligence agencies, Mintel, sees four major trends that will shape the world of consumers in North America in 2016 and beyond:
“Balance or Bust” — Consumers’ willingness and ability to “find harmony by going to extremes.” Easy access to technology that opens up almost limitless possibilities for gaining knowledge or sharing experiences, says the U.K. based company, will also have its balancing side, where consumers look for simplicity and authenticity.
The Big Brand theory — Where consumers will still hold large brands in high esteem if they “get it right,” but will also look for a more personal connection with smaller brands. Craft beer is a good example, but the recognition and acceptance of many major beer brands still persists (think Heineken).
Pride and Persona — The growing importance to consumers that the companies and entities they do business with should embody the same ideals of equality and inclusion and demonstrate a willingness to stand for specific causes.
Eye Get It — One of the most important opportunities that advancing technology has given us is the ability to use visual components when communicating with consumers in digital media on virtually any platform. Text messaging need not be limited to the written word, but it can link a customer or prospect immediately to compelling visual content that either helps to sell a product or to communicate better.
All four trends have implications for auto retail but I think the fourth one is the most interesting. In the auto retail environment greater use of visual elements in communication can translate into much richer sales messages.
In the service context, visual content can add credibility and transparency and build trust with the customer. Allowing the customer to see why a specific repair is needed to their car can help both the customer and the dealership.
Consumers react in a much more emotional way to visual forms of communication, and dealerships should be pushing their business and marketing partners to take advantage of opportunities to increase the use of visual elements in digital communications.
It will not be too long before images on a printed page become the futile way to grab a younger consumer’s attention, when digital platforms are so accessible, customizable and immediate.
While there are limitations with standard texting, technology allows not only fast access to plenty of rich content, but also to reach customers at the right location and at the right time on location-aware devices.
THE “DIGITAL VALUE PYRAMID”
Microsoft described the “digital value pyramid” in a recent global study made up of 13,200 consumers in total, including 1,200 Canadians.
One conclusion is that “it’s about moving people up (the pyramid) so they get to a point where they’re actively looking for technology to be more integrated into their lives and make things easier in a connected world,” said Alyson Gausby, Consumer Insights Lead at Microsoft Canada.
Think of the traditional — and now completely outdated — purchase funnel, turn it on its head and think of the tip of the pyramid as the place where you want to be with each customer.
The theory is fine, but what are the consumer expectations behind the theory that gives us clues as to how to achieve the goal?
Microsoft identifies a number of things that consumers expect these days when the companies they deal with communicate with them:
49% say they are more likely to pay attention to messages from a brand if it’s done at the right time and in the right context.
43% expect brands (or companies) to know when and where that is.
33% expect brands (or companies) to know them and help them discover new products or services that fit their needs.
44% say they are more likely to interact with brands when using specialized digital services.
76% say it’s important for them to be able to edit or delete information about them that is available to companies or what lives online.
What we see here is a succinct summary of how consumers are beginning to define the boundaries and the opportunities presented by digital communication services and capabilities.
THE EVOLUTION OF TEXTING
A recent Harris Poll in the U.S. found that “44% of (American) consumers would prefer to press a button to initiate a text conversation than wait on hold to speak to a business representative”.
Another study by the Canadian Wireless and Telecommunications Association (CWTA) indicated that regular “phone-to-phone” texting started to decline among Canadian consumers in late 2013.
That slack is beginning to be taken up by messaging on social media platforms such as Facebook or WhatsApp. Text, or SMS, has already made major inroads into email as the preferred method of making quick connections or opening dialogue.
While there are limitations with standard texting, technology allows not only fast access to plenty of rich content, but also to reach customers at the right location and at the right time on location-aware devices.
Most dealerships are well aware of these trends, but not many are taking full advantage of the technology available to meet consumer and customer expectations when it comes to digital communication.
In my mind, it’s worth the effort and the investment to make sure that how you’re communicating with your customers represents your business in the way you’d like it to and reaching your customers and prospects in a way that will get them moving up the digital value pyramid with you.
