4 Major Market Shifts That Affect Your Customer Preferences
Consumer behaviors are changing almost as fast as technology. These four main market shifts explain what customers want and why.
By JOHNNY ROSA
One of the hottest buzzwords in customer experience right now is “digital.” There’s a good reason. Technology has blended into almost every aspect of our lives, and the digital revolution has completely transformed the way consumers interact with businesses and purchase products and services. With so much change, it’s easy to lose sight of what really matters.
The following four market shifts highlight the most important business consequences of recent changes to consumer behaviors: customers today want simplicity, speed, and mobility.
“Technology has blended into almost every aspect of our lives, and the digital revolution has completely transformed the way consumers interact with businesses and purchase products.”
1) The On-Demand Economy
The speed of technology means when consumers want something, they want it now. Wherever they are, whenever they need it, consumers can now get whatever they need. Americans are buying in too. 42% of US adults (86.5 million people) have used on-demand services. Instead of waiting around for a taxi that may or may not arrive, modern customers use apps like Uber & Lyft to hail a ride quickly and know exactly how far away their driver is. Americans will spend $58B on on-demand services like ride-hailing this year. The demand for on-demand has been growing quickly, and there’s no sign of it slowing down.
2) The Subscription Economy
Modern consumers have shifted from owning products to consuming services. Consumers see no reason to own items when they could rent or subscribe to them and opt out as soon as their needs or wants change. More and more customers are subscribing to the Subscription Economy every year — the number has grown by more than 100% over the past 5 years. Just think about how the music industry has changed – from buying CDs to subscribing to music services such as Pandora, Spotify, and Apple Music. Today, 15% of online shoppers are signed up for 1 or more recurring subscriptions.
3) Mobile Phone Adoption
Everyone knows the smartphone industry has exploded over the past decade. It seems everyone has a smartphone, and many of us use them almost constantly. This impressive growth isn’t stopping, however (mobile phone adoption rose to 82% this year). The fact consumers love smartphones hasn’t changed much, but what they use smartphones for has. Consumers are increasingly comfortable using their mobile devices for sensitive and high-security actions. 29% of consumers made an in-store mobile payment last year (that’s a 50% increase over 2016). Today consumers send funds to friends, access their bank accounts, and do many other important actions right from their mobile devices. Industries that used to be deemed too sensitive for cell phones must now look to find a presence in the mobile sphear.
4) Cord Cutting
Even cable, an industry with hundreds of channels and a litany of packages to choose from, is feeling pressure from changing consumer behavior. Consumers don’t just want hundreds of channels to choose from — they want the newest, shiniest product or show ASAP. 33 Million US adults will cut the cord in 2018, many switching to digital streaming options. Cutting the cord frees consumers to access the shows and movies they feel like watching whenever their preferences change, rather than being limited to whatever is on the channels they’ve purchased and committed to through a cable package. This a la carte consumption is appealing. 291 Million people watch Netflix, Amazon Prime Video, or Hulu every month.
The digital transformation our society has experienced over the past decade has created a consumer culture that prioritizes simplicity, speed, and mobility.
The On-Demand Economy highlights customers preferring fast service over tradition. Consumers are flocking to companies providing whatever they want whenever and wherever they are. The rise of the Subscription Economy means recurring revenue for businesses, but a new level of personalization for consumers. Customers subscribe to the products and services they want, and are simple to use. Mobile phones have become a cornerstone of our daily lives. The ability to access so many parts of our lives — friends, finances, and more — from anywhere is a flexibility and mobility every consumer can buy into. That freedom mirrors what we see in a wave of cord-cutting consumers seeking the ability to watch what they want whenever they want, without waiting for a specific channel to carry it.
Companies that understand their customers will focus on these important shifts as more and more consumers buy in to the digital revolution.
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4 Major Market Shifts That Affect Your Customer Preferences
Consumer behaviors are changing almost as fast as technology. These four main market shifts explain what customers want and why.
By JOHNNY ROSA
One of the hottest buzzwords in customer experience right now is “digital.” There’s a good reason. Technology has blended into almost every aspect of our lives, and the digital revolution has completely transformed the way consumers interact with businesses and purchase products and services. With so much change, it’s easy to lose sight of what really matters.
The following four market shifts highlight the most important business consequences of recent changes to consumer behaviors: customers today want simplicity, speed, and mobility.
“Technology has blended into almost every aspect of our lives, and the digital revolution has completely transformed the way consumers interact with businesses and purchase products.”
1) The On-Demand Economy
The speed of technology means when consumers want something, they want it now. Wherever they are, whenever they need it, consumers can now get whatever they need. Americans are buying in too. 42% of US adults (86.5 million people) have used on-demand services. Instead of waiting around for a taxi that may or may not arrive, modern customers use apps like Uber & Lyft to hail a ride quickly and know exactly how far away their driver is. Americans will spend $58B on on-demand services like ride-hailing this year. The demand for on-demand has been growing quickly, and there’s no sign of it slowing down.
2) The Subscription Economy
Modern consumers have shifted from owning products to consuming services. Consumers see no reason to own items when they could rent or subscribe to them and opt out as soon as their needs or wants change. More and more customers are subscribing to the Subscription Economy every year — the number has grown by more than 100% over the past 5 years. Just think about how the music industry has changed – from buying CDs to subscribing to music services such as Pandora, Spotify, and Apple Music. Today, 15% of online shoppers are signed up for 1 or more recurring subscriptions.
3) Mobile Phone Adoption
Everyone knows the smartphone industry has exploded over the past decade. It seems everyone has a smartphone, and many of us use them almost constantly. This impressive growth isn’t stopping, however (mobile phone adoption rose to 82% this year). The fact consumers love smartphones hasn’t changed much, but what they use smartphones for has. Consumers are increasingly comfortable using their mobile devices for sensitive and high-security actions. 29% of consumers made an in-store mobile payment last year (that’s a 50% increase over 2016). Today consumers send funds to friends, access their bank accounts, and do many other important actions right from their mobile devices. Industries that used to be deemed too sensitive for cell phones must now look to find a presence in the mobile sphear.
4) Cord Cutting
Even cable, an industry with hundreds of channels and a litany of packages to choose from, is feeling pressure from changing consumer behavior. Consumers don’t just want hundreds of channels to choose from — they want the newest, shiniest product or show ASAP. 33 Million US adults will cut the cord in 2018, many switching to digital streaming options. Cutting the cord frees consumers to access the shows and movies they feel like watching whenever their preferences change, rather than being limited to whatever is on the channels they’ve purchased and committed to through a cable package. This a la carte consumption is appealing. 291 Million people watch Netflix, Amazon Prime Video, or Hulu every month.
The digital transformation our society has experienced over the past decade has created a consumer culture that prioritizes simplicity, speed, and mobility.
The On-Demand Economy highlights customers preferring fast service over tradition. Consumers are flocking to companies providing whatever they want whenever and wherever they are. The rise of the Subscription Economy means recurring revenue for businesses, but a new level of personalization for consumers. Customers subscribe to the products and services they want, and are simple to use. Mobile phones have become a cornerstone of our daily lives. The ability to access so many parts of our lives — friends, finances, and more — from anywhere is a flexibility and mobility every consumer can buy into. That freedom mirrors what we see in a wave of cord-cutting consumers seeking the ability to watch what they want whenever they want, without waiting for a specific channel to carry it.
Companies that understand their customers will focus on these important shifts as more and more consumers buy in to the digital revolution.
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