Think differentiation - owning customer consciousness

Think differentiation - owning customer consciousness

There are 3.24m ATMs worldwide. An invention credited to John Shepherd-Barron.
Adopted by Barclays bank Enfield branch in 1967. Another Scot, James Goodfellow had patented the ATM the year before. Goodfellow was angry about the lack of credit, but he knew getting it right was the answer, not being first.

But… in consumers’ minds, that isn’t true. Consumers’ impressions are binary: ‘number one’ and ‘everybody else’.

Differentiation = owning consumer consciousness. Consciousness creates differentiation. Without it, you’re just everyone else. Differentiation creates brand value clarity.
Brand retail mantra: “One is wonderful. Two is tolerable. Three is threatened. Four is forgotten.

[Edited comment from Dave Trott’s Campaign column (2020)]

Consumers’ behaviours adapt based on circumstance and perception.
We’ve learned many things from the shared experience of a global pandemic. We humans have been resourceful, adaptable and demonstrated a willingness to change our shopping behaviours rapidly.

• 62% of consumers’ lives have changed significantly due to COVID-19*.
• 60% are coping with its impact, but there is a strong desire for life to “Get to normal”*.
• 50% of consumers expect their lives to be significantly different in the long term*.
• 53% say their values have changed and they look at life differently*. There are significant implications on how we shop and buy in certain categories.
• Health, value for money and customer experience are some characteristic of “Covid anxious consumerism”*. Pandemic anxiety is predicted to be long term.

Digital Darwinism - the evolution of consumer perceptions.
The EY Consumer Index* has identified and is tracking new, post-COVID consumer segments. The experience of the pandemic crisis is reshaping consumers with new need states, deeper values and higher expectations, and certain new consumer segments are becoming more committed to their value tribe.

1. Consumer consciousness - “Affordability first” segment representing approx. 30% of consumers. This segment’s priority is living within their means, avoiding buying things they don’t need. They make a purchase after extensive best deal online browsing. They have very limited interest in what brands they buy, in certain categories - they just care that a product delivers what they need. They are highly likely to trade down unless convinced that products are superior.
   Consumer behavioural change – ‘No. 1 brand’ is not a buying differentiator in certain categories.
   Digital commerce impact - media & messages (eCommerce & marketplaces) need to communicate significant superior features & benefits to justify price premium. Sale, no sale.

2. Consumer consciousness “Health first” segment representing approx. 26% of consumers.
   This segment’s priority is to protect themselves and their family’s health, this is their primary purchase driver. People in this segment prefer brands and products they trust to be safe. They are very risk adverse, so when possible they only shop online. The “Health first” consumer is likely to be living with family and is pessimistic about the return to “normal” life. The pandemic has changed their values and the way they look at life.

Consumer behavioural change: new eCommerce customers.
Digital behavioural impact: the need to personalise media and messaging in eCommerce & marketplaces, combined with a need to reinforce brand trust status and health benefits.

3. Consumer consciousness “Experience first” segment representing approx. 16% of consumers. Shoppers in this segment value customer experience in their life. They try new brands, products and services, especially when they are personalised, and they choose brands that enable them to associate with their core values and purpose. They are mostly Millennials or Generation Z and are the least anxious about the global pandemic, health and finance. They are constantly changing what, when and how they want to experience things.

Consumer behavioural change: “Experience first” shoppers –  high value and very loyal segment.
Digital behavioural impact: High demand cycle for personalisation and mobile first eCommerce is a critical part of life. Influenced by value, status perception, purpose and lifestyle association.

 

*Data from - Ernst Young Future Consumer Index 2020