Today's marketplace challenges are not driven simply by the global recession and its affect on people's perception of "value." This new, new economy has been building for the past ten years. Evolving marketplace conditions have created a very particular consumer mindset; one which most marketers are woefully unprepared to deal with. Make no mistake; the economy is not the problem. It has simply exposed the problem, like melting snow exposes the mud beneath.
Here are the five conditions that have inured today's consumer and confounded scores of organizations:
1. Supersaturated with choice
In the United States alone, there are dozens of brands of toothpaste, hundreds of car brands (soon to be a lot less), thousands of organized religious groups and tens of thousands of non-profits. Google any product or service you can think of and take a look at the shear number of results. There are somewhere between thirty and fifty thousand different brands in a typical grocery store, and there’s a plethora of new ones, and ones designed to look new, appearing every day. Toss in clothing, electronics, books, restaurants, hotels, sporting goods, financial products, drugs, jewelry, insurance, professional services, vacation destinations, etc., along with club stores, dollar stores, convenience stores, specialty stores, TV shopping, direct marketing, the Internet, etc. and you’ll quickly get a feel for this particular condition. And the flood
of marketplace offerings and channels is not about to subside
any time soon, because the rapid development and
introduction of new products is essential to satisfy customers’
bottomless appetite for novelty and value.
2. Glut of conflicting information and media platforms
The Internet is now populated with
tens of billions of web pages. While I've been typing this post tens of thousands of new pages have been added. This is simply one blog out of close to 70 million (at least that's the number being tracked), and around 150,000 new blogs launch daily. Don't even get me started with tweets. :) And that same information glut exists in old media as well.
There were close to 300,000 books published last year; over
7,000 of them were business books. There are tens of thousands of magazine
titles. In the very near future, there’ll be an almost
infinite number of television channels as TV,
radio, and the Internet converge providing
access to streaming audio and online video right from your
TV remote, which invariably will have a little search box
built right in. However, there’s something paradoxical about
this “wealth” of information:
It’s all conflicting. Find me a piece of information,
and I’ll find you information that refutes yours, or at the
very least, calls the validity of yours into question.
3. Radical transparency and message amplification
The second generation of web-based services referred
to as Web 2.0, which emphasizes social networking, online
communities, collaboration, interactivity, and user-created
content, has created a hyper-connected marketplace. Customers
are increasingly sharing information and opinions
about products, services, people, and organizations. They’re
posting photos, videos, reviews, recommendations, prices,
and thoughts on anything and everything from new product
designs and stocks, to corporate behavior and inner
company workings. The whole concept of word-of-mouth
has been turbocharged, turning the Internet into both a
bullhorn for customer complaints and a massive market
research channel.
4. Savvy, active discerners and participants
Today's customers “get it.” Yesterday's passive consumers have become active discerners and meaning-makers of
marketplace information. They don't passively sit around and
consume commercial messages like they used to. Either
they tune them out, by channel surfing, multitasking, or
removing them from their media content, or, if the product
or service is highly relevant to them, they get involved in
some way. They may do detailed “research” on the Internet, or participate on a blog or some other online forum. Or, they may email their friends for
their opinions or even create and post their own advertisements
or other content. Consumers fully understand the game that is
being played, and they are choosing to play it the way
that best fits their fancy.
5. Distrust in business
Customers
increasingly don’t trust businesses or the people who run
them. At least that’s the state of consumer trust in the U.S.,
as measured by various researchers. The rampant media coverage
of various blunders, indiscretions and scandals has fueled a cognitive bias in
people, referred to as the availability heuristic, where they
base the prediction of the frequency of an event occurring,
like a person or company lying, on how readily an example
can be brought to mind.
So people are conditioned to distrust. Today, everyone is subconsciously assuming that
business people are guilty until proven innocent.
So if you want to move forward and grow your customers and margins, you must stop blaming your marketing challenges on the economy, accept today's new marketplace realities, and start making substantive changes to how you appeal to today's very new customer sensibility. Unfortunately (or fortunately if you're aware of what's happening), the old models don't work the way they used to and, despite wishful thinking, they never will again.
