Trust and confidence will not leverage businesses out of the recession
Here are eleven strategies to push you through to recovery. Here are my thoughts on 'trust' and 'confidence'. They are simply two words which depict emotional states which individuals experience. How we can be made to experience more trust and confidence is widely debated.
Trust & Confidence
The presence of these emotional states in people, either individually or collectively, may trigger a change in behaviour - and that's what economists hope will happen with eager consumers creating a retail revolution in the high street.
Consumer Recovery - Where, When & How
In terms of economic growth we are led to believe that the return of 'trust and confidence' will signal a recovery reflected in changes in consumer behaviour.
Commentators and analysts hope that this will trigger an economic revival. I am not so sure. I do not know what strategies I could use to build trust and confidence in a short period of time. Fiscal measures would help.
My Business Network
You can guess most of us who run businesses are keen to find when the recovery will start. I have had many meetings in January with a variety of colleagues from Web Designers, to Recruitment Consultants and IT specialists to Hoteliers.
We are all looking for new ways to get customers to knock at our doors. Here are some ideas and they are all driven by you.
Eleven Strategies to Achieve Economic Recovery for the average Business
1. Is there a demand for what you supply?
Decide what it is you are about to sell. It matters not whether its goods or services. Is your service of value to those whom consume it? If you don't have any effective demands for your services you have no business.
You just have something to sell that people don't want. They may want it in another market place - they may love it - but in your current market place you do not have a business. This can still work - but you have to relocate to a geography where interest is intense.
2. Are your customers 'Raving Fans?'
How do your customers respond to what you sell? Are they 'raving fans' who act as strong advocates making active recommendations and referrals for you - or are they lacklustre in their praise?
If you can count on them to recommend you to other potential purchasers then you have to devise a strategy to achieve that. If not how can you turn their indifference to passion?
3. Do you have a powerful value proposition?
What is your value proposition from your customer's perspective? What value do you bring to them and their business or their life?
4. Do you have tangible benefits from the customer perspective?
What benefits will accrue or be experienced by your customers? Be honest with yourself do they really experience these benefits or are they just part of your sales patter?
5. Why do customers leave you?
Do you know why your customers stop trading with you? What are the top three reasons they move on? Address these and you may retain customers. Do you have a customer retention strategy? What warning signals have you ignored that indicate that their loyalty to you is about to be displaced?
6. Qualifying Prospects
Do you know how to win new converts to your business? Do you have strategy to convert interest from prospects into paying customers? Do you know how to qualify your prospects?
7. Marketing vs. Sales
Have you developed a marketing plan that works? Some of your marketing will fall on deaf ears - some will generate interest which may result in purchasing.
Marketers' have this problem of not differentiating which bit of their marketing tactics worked and which bits did not? You have to set up reliable measures?
8. Cold Calling
Have you committed to winning new customers through cold calling? Most people will do anything to avoid call calling. Many are terrified of it because they don't know how to do it. With cold calling comes rejection as well as success.
Develop the interpersonal resilience, master this process and you will always have a growing customer base.
9. How do you Market yourself?
What media do you rely upon? How do people find out about what you do? What works for you? What do your competitors do that works for them that you don't? If you don't know - find out.
10. Emotional Needs & Wants
What is it that you provide that makes people feel good about you? What bad things or pain are never experienced by the customer because of what you provide? How can you leverage both to your advantage?
11. Build a Sales Culture
Everyone you employ has the capability to engage with existing and potential customers. Don't believe that sales leads reside with sales people.
You may wisely decide to only approach potential prospects through your sales business but harvesting names and routes should be promoted company wide.
From Recession to Recovery
If you run your own business this responsibility resides with you. If you need capital or borrowings then that may be a different story.
However, if you do have effective demand for your product or services and can leverage interest reflected in purchasing decisions you will be in a strong p
Today is the inauguration of Barak Obama. It is also the day the share price of RBS fell to 10.63 pence from a high on 1 March 2007 of 600.01 pence.
I felt sorry for employees who last year were encouraged to buy shares at 200 pence. Many took out loans or re-mortgaged to buy the "once in a life time offer to buy RBS shares" at this knock down price. We know they should have spread their risk - but now some will lose hundreds or thousands of pounds. Not a great New Year for them and my heart goes out to them. What was to be a healthy financial retirement is now a rethink of working for the rest of their lives.
Banks, Financial Institutions in Trouble
Of course it's not just RBS. Be poised to learn more of the other institutions like Lloyds, HBOS and Barclays, including the FSA.
Moving on
How does this news impact us as consumers and employees of financial services? We do have a choice. We could feel bitter and demand restitution. It will never happen. What must happen is that the Banks move on and recover their reputation and their service to the business community.
I doubt very much that legal proceeding will be brought against these Bankers. No Bankers will go to jail.
Taking Responsibility for Change
In his inauguration speech Obama today made it very clear 'we have to take responsibility, be interdependent and integrated' in the role as US citizens for driving change in business and society.
I believe this is true attitude we have to adopt regarding recovery form the Recession in the UK. Can you really expect Politicians being able to get us out of the mess without the business community's help? Politicians have to rely on us to get the economy started moving again but they have to pset the game up so that we can operate with support from the banking sector. Fundamentally, if the commercial sector lacks confidence the recovery will never happen. It is time for the Governmnet to be business friendly. It's down to us as managers, entrepreneurs and team members in our businesses to make things work.
The sign of a resilient and robust character when something bad happens is not how you react but how you respond to take action to resolve it. The same can be said for RBS. One thing for sure is they do have a very powerful business culture which has achieved a great deal.
RBS has superior people capability - high performing staff at all levels
What drove RBS to achieve an unheard of profit of £10 billion was not a few people at the top, steering the streategic direction, rather the the overall quality of people right the way through their business is what created the success. They are still there. They still have the same capabilities and I am sure they want to build the Bank again into a strong contender - after all it was the 5th largest Bank in the World.
Shaping Organisational Change: Make it Happen
Corporate change takes longer than most want it to take. If that is the case - start sooner. The bank has to start rebuilding its reputation and its infar-structure now. If we don't see some action in commercial activity by mid February we are in for a very long recovery. I hope the organisations will rise to the challenge and put the right strategies in place to 'make it happen' - which is the RBS 'strap line'
Stimulation is really Based on USA Policy
What will work, is trading on the superior performance of over 170,000 people who are ably skilled to ride the road to recovery with the right leadership.
We have to let them gather their wits and then take action. But I have a feeling that the £200 billion bail out will not work until something happens across the Atlantic.
I think we will be looking to Obama as the real person who "saved the world" despite hiis only being inaugurated just a few hours ago.
Radical Change: Customers & Consumer Behaviour in 2009+
You can bet that consumer behaviour texts are now out of date. Radical changes in patterns of consumption are here to stay. Even a reduction of the Bank rate to 0% is not going to impact consumption. The economy needs a much bigger shift to ignite the circular flow of income from customers to suppliers of services and goods.
Hello - has anyone heard the Wake-Up call?
Consumers have experienced a ‘wake up call’ so intense it will have ramifications for customer and consumer management and behaviour for decades to come. When the fall-out from the recession hits in 2009 and 2010 the way we do business with our customers, or consumers of our service, will change forever.
Companies and indeed all organisations will have to examine how they transact business and adopt very new strategies to win consumer confidence. To win life time loyalty – the purpose of most organisations to guarantee survival – will be more than a challenge.
Changes in Perception, Behaviour & Attitude
Consumption changes with tastes, trends, fads and emotions and we have had a huge emotional shock to the system, moving us ever forward from the traditional customers focused on transactions to the authentic customer, where purchasing is based not just on cost, but also is a reflection of their personal beliefs, values, behaviour and emotions.
Managing all Customer Interfaces and Interactions with the Business
Customer management has never been simple. Consumers and customers are complex beings who now are making conscious, thoughtful, decisions when previously their behaviour may have been driven automatically by habit.
What I mean is prior to the ‘crunch’ our consumption patterns and purchasing decisions may have been relatively and habitually defined and fixed most of the time.
We would tend to purchase goods and services driven by our lifestyles and our habitual way of living – such as always eating at the same restaurant every few weeks, purchasing a variety of magazines at the weekend or buying personal treats’ once a week from an high class retail shop.
Now, consumption has changed and will change forever. Other retailers tell us that consumption for certain items has declined by 7-10% compounded to year end 2008. This is only start of the trends of conscious rational purchasing decisions mirrored in trends in consumption in 2009-2011.
Consumption Patterns Changing
It does not matter which area of the economy we occupy. We note that changes in the consumption of food, leisure services, basic retail goods, white goods and automotive products will change forever because people are now running any purchasing decisions through their own checklist of questions – Do I need this? Can I purchase it cheaper elsewhere? Are there any better deals? Can I buy it on-line or somewhere else?
Emotions and the Authentic Customer
More business should be aware that there are key emotions that drive customer loyalty and purchasing decisions. This is true whether you are purchasing a candy bar or HP for a new car.
If you consult a dictionary you will find 3000+ words to describe emotions or emotional states experienced by us all.
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Did you know that the presence or absence of emotions can have this impact on a purchasing decision? Of course, the emotions within and during the purchasing process will vary and can be changed radically by your approach to customer management. I will illustrate with just 7 emotions. During the purchase of a retail item a variety of customers expressed these emotions.
Anger 30%
Happiness 21%
Frustration 21%
Annoyance 13%
Disappointment 10%
Satisfaction 10%
Impatience 9%
Do you know the key emotions that are created when you transact business pre and post purchase with your customers? What positive emotions can you create in your sales cycle and what negative emotions can you avoid generating with your customer? Most retailers and suppliers simply do not know.
It surely makes sense to promote the positive emotions and these may not be present in the sample above. It’s also wise to restrict any opportunity for your customer to experience any negative emotion. It’s in your hands you have control.
Authentics & Millennials
‘Authentics’ and ‘Millennials’ are replacing the traditional Consumer or Customer. They are individualistic, independent, informed and distrustful of big business. Lots of things occupy their minds and they depend on multi-media to refine their tastes. You have a few seconds to impress them because their attention span is short.
Time & Loyalty
Time is of the essence. They want things now and time is a scarce commodity, so don’t waste it. There is never a second opportunity to make a great first impression with the new consumer.
Loyalties to one provider as a concept is out you have to impress them every time at every opportunity and at every stage of any transaction – pre to post purchase decisions.
Buyer’s Remorse
Buyer’s Remorse is intense with new consumers and disappointment with your provision of service will be widely broadcast.
As you may gather this requires customer management excellence. And how few organisations provide this?
Casual purchasing decisions that were automatic and habitual will now require more analysis.
Add to this formula the recession, unemployment when the threat to one’s livelihood is real and personal how will you now transact business with them? The consumer and the market place have changed forever.
Customer & Consumer Management Post 2009+
o what can we do about it in business? You will need some independent research to:
Assess your customer base and customer satisfaction or CSI
Do you know how much it costs you to win a new customer?
Do you know why customers stop doing business with you?
Identify customer purchase decisions from interest, qualification to closing the sale
Identify core emotions – isolate positive emotional states from negative one’s which your organisation may have created unwittingly or purposely
Analyse negative and positive ‘moments of truth’
What positive emotions can you create in your sales cycle?
What negative emotions can you avoid generating with your customer?
Examine channel delivery impact on customer and consumer behaviour
Create a process map of the perfect consumer or customer experience with identified actions for implementation
If any of these ideas are of value to you and you would like to take these further contact us direct at Philip@philipatkinson.com
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