At one point of time, only certain businesses and professions had to take the time to empathize with their clients and listen to their needs. During prosperous times, retail businesses never bothered to take the time to play the role of a counselor, or an advocate, in order to listen to their customers and customize their services for their unique needs. All this changed as a result of the downward spiral of the current economy.
Today, it’s more important than ever to pay close attention to what a customer needs and try to meet consumer demand. This is one sure way you can ensure that you maximize the chances of your business sustaining in this bad economy.
The Major Three Constituents of Consumer Demand
During this period of recession, the majority of your customers will face the same issues: Increased expenditure, reduction in income, and solutions that do not satisfy their immediate needs. Based on various business theories, consumer demand comprises three major constituents.
Level of Income
There is not a lot that a business can do about the reduction in the level of income of a customer. There is something that can be done in relation to price. A business can mark their prices low in order to attract consumer attention. However, this is not a very efficient strategy as downward pricing can put your bottom line profits at risk. Therefore the only other way to amp up consumer demand is through personal preferences.
Phasing out Retail Choices
It makes good sense for huge retailers that carry inventory to gradually phase out products that are not in huge demand, and to cater more to tastes that appeal to the masses. This is where online businesses have an advantage in this meek economy, as they can offer a wide range of products without necessarily having to inventory it. By listening to their customers who are experiencing difficulty closing in on a particular product that can only be purchased online, online retailers can offer this, and thus be able to raise demand for their products and ultimately their business.
Understanding the Psychology of Consumer Demand.
While it is true that people have less to spend, and are becoming more economical, it is not necessarily true that consumers will always be attracted to cheaper alternatives. In fact, the value of a purchase becomes more crucial as long as the recession lasts. A product that can last a long time is of better value than a product that can easily break down, crashes, or become of no value in a few weeks or months down the line. Consumers are not only buying things that they want, but they are gravitating towards choices that satisfy their needs as well as stand strong through time.
By offering products that are in good demand, slowly phasing out products that the majority of consumers don’t need, and by offering products that stand the test of time, retailers can ensure that their business can sustain through the recession and further beyond.