How do customers find your services or products?

Over the recent few years, there has been a revolution in the way that consumers find services or products. For organisations selling B2C products or services, these changes have immense impact on the way their products are marketed

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With increasing numbers of products on the market, improved customer awareness of the range of services available, and immense diversification in the channels through which people buy products and services, the focus has moved from companies pushing their products towards consumers to the emphasis being on consumers searching for products.

Increasingly, customers face a greater choice of when to buy, what to buy, and through which channels to buy. Although customer search statistics differ from product to product, sector to sector, and service to service, the following general trends tend to apply across all sectors.

TRADITIONAL METHODS

Traditionally, customer search behaviour has been dominated by the high street. Consumers would browse shops for products – traditionally via the local high street, more recently through supermarkets. For fast-moving-consumer-goods, for example, up to 97% of customer searches have been recorded through retail outlets.

For larger purchases, such as specialist equipment and home improvements, the chief sources of enquiries were printed directories. Principal among these was Yellow Pages, with alternative directories led by Thomson Local. For home improvements, for example, over 11% of customers during the late 1980′s searched via Yellow Pages.

Local newspapers have also been a valuable source of business for many customers - with searches being conducted via classified sections and specialist regular features such as “find a tradesman” or “homefinder” sections….etc, accounting for up to 10% of consumer product searches. 

Finally, a major souce of information has traditionally been family and friends. Personal recommendations have traditionally accounted for up to 25% of all sales drivers for many products.

THE CHANGING WORLD

In terms of retail purchases, there have been two changes that have altered purchasing patterns more than anything else: the rise of the supermarkets, and the rise of the internet.

In retail terms, supermarkets dominate the UK market to an extent that is not seen anywhere else in the world, and to a degree never experienced at any period throughout history. In grocery terms, the top 4 retailers in 1950 enjoyed less than 1% of the total UK market; today, the figure is in excess of 68%. For consumer products to be visible to consumers, they must appear on the shelves of these major retailers. In terms of FMCG products, the trend towards retailer loyalty over product loyalty has been steady for over a decade: people tend to visit one single retailer for the majority of their purchases, which gives the supermarkets enormous power over the buying decisions.

It is also noticeable that the time spent shopping via retail outlets has declined, with increasing pressures on people’s time. The term “browsing” hardly seems appropriate any more: consumers typically rush around a supermarket to stock up, as opposed to spending time considering alternative products from alternative sources.

Similar movements have been experienced in specialist markets: when people want to browe for toys, they will head to the local Toys R Us; when looking for lawnmowers, they head to B&Q. 

The second major change has been the development of the internet. Nowadays, the majority of product browsing is undertaken over the internet. Increasingly, this is via search engines (such as Google, Bing and Yahoo) rather than via online directories (such as yell.com). In fact, for most groups of products and services, the most common method of browsing is online. The growth of online browsing has been swift – in 1990, less than 4% of product searches were undertaken via the internet.

By comparison, the traditional media of printed directories are in decline. Through the early part of the 21st Century, the movement from Yellow Pages to yell.com was dramatic. Now, with online searches being increasingly performed through search engines, even yell.com is being marginalised, with searches for many key products contributing less than 3% of total searches.

Even more dramatic has been the decline in searches through local newspapers, which have been marginalised almost to the point of irrelevance.

Although personal recommendations still constitute a major factor is people’s decision-making, recommendations are increasingly passed on over the internet, through online social networking, as opposed to face-to-face networking. 

ASSESSING YOUR SPECIFIC MARKET

By understand how – and through which media - customers search for products, the marketer can ensure that his product message is placed therein. For example, a marketer promoting the supply and installation of UPVC conservatories will, if he has completed his research effectively, understand that when potential customers decide to install a conservatory, they will look in the following places.

ONLINE SEARCH (SEARCH ENGINE)      41%
PERSONAL REFERRAL                                 22%
PRINTED DIRECTORY                                   13%
PROFESSIONAL RECOMMENDATION      9%
ONLINE SEARCH – DIRECTORY                7%
DIRECT SALES                                                  4%
LEAFLET / FLYER                                            1%
NEWSPAPER ADVERT/CLASSIFIED         1%
OTHER                                                                 2%

Despite this, the majority of conservatory installers do not have a website, actively promoted. Instead, they tend to focus on methods that have worked in the past – direct sales teams, local advertising, and leaflet drops, for example.

Before deciding how to market products or services, it is important to understand how the buyer behaves. This information can be key to ensuring that a company’s marketing resources are used effectively and efficiently, and that money and time are not wasted up “blind alleys”.

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