We are in a time of immense global change. From individual consumers to businesses right through to Governments, this lack of uncertainty is damaging confidence and stymying growth and prosperity.
The global consumer confidence crisis
Consumer confidence and satisfaction data shows this sentiment isn’t unique to certain regions or demographics, but is being felt across countries with diverse economies and cultures globally. According to the OECD, global consumer confidence has never fully rebounded to the consistent levels seen before the pandemic. In the US, the Conference Board Consumer Confidence Index fell 5.4 points in June from May, with consistent decline across all age groups, political affiliations, and incomes, demonstrating how this feeling cuts across all parts of society. All of this data and the constant stream of negative news means it can feel like we are in a persistent decline.
However, despite this persistent negative sentiment, I believe things can improve if we start focusing on the right things as business leaders.
When consumers are conscious of challenging economic times, they may hold off buying their next big ticket item or booking a holiday. Similarly, when businesses feel pressure and sense uncertainty, they halt investment and chose to freeze spending, thereby often exacerbating the problem and leading to broader economic stagnation.
How to break the downward spiral
We need to break this downward spiral. One way to do this is to seize on encouraging signs of hope and drive up a sense of positivity.
Today, the latest iteration of the customer satisfaction and consumer confidence survey, the UK Customer Satisfaction Index (UKCSI), is published and shows some of these positive signs we may be seeking. The UK’s most comprehensive independent index of its kind, it reveals that over a third of British people (35%) are planning to make a major purchase in the next 12 months.
This follows a period where many consumers delayed major purchases, including home improvements, holidays, furniture, and appliances, because of low confidence in their current finances, economic uncertainty, and broader inflationary pressures.
News like this offers an opportunity to shift momentum, inspiring companies to rethink and drive forwards growth through proactive problem solving and investment in innovative solutions.
Photo by Jeenah Moon/Getty Images
Double down on investment in customers
One way that businesses can improve consumer confidence and build momentum is through doubling down on its investment in the customers. The UKCSI also highlights that 83% of consumers would be more likely to follow through with these big-ticket purchases if they receive exceptional customer service. This means staff being knowledgeable and well-trained – which is cited as the most important factor for defining good customer service – and the customer journey being easy to navigate and frictionless, no matter what technology or touchpoint is used.
With such long-term uncertainty, customers are rightly cautious about parting with their money. It’s no coincidence that when we are more financially constrained, we gravitate to our favorite brands. Trust is critical. Individuals want to feel secure with the brands they buy from, and they will often prioritize this feeling over price, even when budgets are tighter. It’s up to businesses create and maintain this trust and loyalty with their customers, by remaining in tune with their needs and aligning with their values.
This requires putting the customer at the heart of proactive growth strategies and embedding a culture of service, ensuring that colleagues all across your business know the customer inside out. Businesses now also have a huge opportunity not available in the past – they can capitalize on the best of what AI can do for the customer experience in terms of efficiency and personalization, and balance it with real life, human interactions – and getting this fusion of technology and human contact will be critical to a strong, sustainable service strategy.
It’s the companies that really focus and invest in their people, good technology, supply chains and experiences in these challenging times that will retain and grow loyal followings. The opportunity is there, and it’s been proven to work. We just need to capture it by inspiring people and making them feel cared for. This is what will break the consumer confidence cycle and be the catalyst for sustainable growth and that crucial optimism we are all seeking.
