To keep and win customers, businesses need to rethink how customer value is delivered.

START TAKING ACTION NOW

Business will have to deal with many issues such as new complications with supply chain management, disrupted ways of working and a workforce with a whole new list of professional and personal challenges. Businesses also need to start thinking about surviving and potentially thriving when the dust settles from current restrictions that have had an immediate and devastating impact on business results. 

Any business counting on 'rebound spending' post corona will be greatly disappointed. Everyone will 'rebound' with a loss, consumers as well as businesses. With so many cut backs, unemployment and anxiety about the unknown, customers will come out of the crisis with new needs, expectations and decisions for what they are willing to pay.

THE CONTEXT OF A SHIFTING PERCEPTION OF VALUE FOR MONEY

This has been triggered by the crisis and will spill over to the ‘New Normal’. As customers have been hit hard financially and with added social restrictions, they have learned to do more with less, becoming more risk averse and hyper price sensitive. This rise in anxiety, stress and even resilience is leading them to reprioritize what is important and what is not. 

THE NEW PERCEPTION OF VALUE

• Customers will exhibit an increased price vs. perceived utility sensitivity.
• Customers will streamline their portfolio of preferred brands, leaving low perceived-value brands behind.
• People will appreciate and prefer businesses that remove effort throughout the customer journey, especially digital journeys and payment mechanics.
• People will make decisions based on risk avoidance such as opting in to products and services that do not try to ‘lock them in’

WHAT BUSINESS SHOULD DO NOW

• Focus on value segments and value offerings in product and service portfolios as there will be a growing number of value segment customers.
• Reshape offers for shrinking middle and premium customer segments.
• Design ‘Smart Discounts’ that create strong value perceptions without seeming ‘too cheap’ for their brand.
• Position products and services as authentic, transparent and conscientious about peoples’ needs.
• Optimize useful and easy self service channels with a superior UX in as few steps as possible.
• Simplify processes and waiting times to get things done.
• Create more seamless and effortless customer journeys with Direct-to-Consumer and Direct-to-Home models.
• Consider more risk-free financial options such as pay-as-you-go, flexible non-lock-in offers and suspending unnecessary fees.

IN CONCLUSION

People will be selective and careful on how they spend their money and key criteria will be how true value, utility, quality as well as price will be significant factors for choice and preference. Smart businesses will start developing new offers and focus areas now so that they are ‘future ready’. 

A reopening of the economy is not the same as restarting the economy. Businesses need to start working on the New Normal now.