What will your customers want to see after 2020?

Looking to the future it’s clear that 2020 has driven an adapted way of thinking and being.

We have reflected on what this might mean for your customers.

From a financial perspective your customers will broadly fall into two groups

o The first group will have more cash in the bank.

The percentage of disposable income (money left to spend on non-essentials) saved rose from 9.6% to 29.1% in 2020. This was more than double the previous record of 14.4% set in 1993. Statistics had previously revealed how the closure of large parts of the economy led to Britain saving billions of pounds and paying off billions more in debt (source thisismoney.co.uk)

o The second will have less cash to invest in non-essential products or services and will be looking to cut costs where they can.

The Institute for Fiscal Studies (IFS) pointed out that: “Groups that are vulnerable to poor health are likely to be hit hardest even if the crisis hit all individuals equally, but evidence is already emerging that the economic repercussions of the crisis are falling disproportionately on young workers, low-income families and women (Joyce and Xu, 2020).”(19) The Breugel agency has also noted that among workers across Europe, the self-employed are being hit hardest by the work-related effects of social distancing measures.(source mentalhealth.org.uk)

Putting cash to one side what else is important?

Customers will be united by one thing and that is the impact that 2020 has had on them and how this has shaped their thinking and behaviours as we move into 2021.

According to Harvard Professor Gerald Zaltman 95% of purchasing decisions are subconscious. This means purchasing behaviour will be driven by the perception of the customer as to what extent the seller will meet their needs.

We’ve outlined below our view on the 4 needs of your customers after 2020

NEED 1 – your product or service has a positive impact on the planet

There has been a marked increase in awareness of the challenges we face around the future and protecting our planet. Several campaigns including WWF and David Attenborough’s Our Planet |Too Big to Fail have tapped into the emotion of society and have convinced many people that climate crisis is a reality.

A study by Yale estimated that 72% of US adults now think global warming is happening and this view has shown relatively rapid year on year increase.

According to the Competition and Markets Association last year £41bn was spent in the UK on eco-friendly products and this value is growing. Progress within businesses to provide innovative solutions to environmental challenges has been encouraging. Examples include a 100% recycled Ikea store in Sweden. 100% Renewable energy supplier Bulb launched in 2014 has attracted 1.5 million members and now controls 5% of the UK’s domestic electricity market.

Customers will be particularly seeking out products which are sold as part of the circular economy, ie your product eliminates waste and uses existing resources. Examples of this are refurbished laptops and phones.

If you have customers which are larger corporates, they have to meet regulation around reporting their carbon footprint.

To support this, they will be expecting you to be working towards reduction of your carbon footprint and sharing your carbon footprint with them to incorporate into their reporting.

NEED 2 – your organisation supports your local community

Smaller businesses have been hit particularly hard by the pandemic.

The Office of National Statistics shows that 93% of larger businesses are still currently trading. Compare this to only 81% of micro businesses (businesses with fewer than 10 employees) and 87% of businesses with less than 50 employees.

Small and micro businesses are more likely to be local businesses in the community. The level of closures reported by the ONS shows the extent to which communities have been hit financially. Furthermore, on average 43% of adults have either stayed at home or only left for work, exercise, essential shopping or medical needs since the start of the pandemic and mid-November.

Society has become more attached to its community and are looking to support it. Organisations who are actively involved in supporting local charities, creating jobs and driving economic growth will be more attractive to customers.

NEED 3 – your organisation looks after your teams well

The 2 things driven by 2020 which customers are particular expecting organisations to give their teams are fair pay and access to mental wellbeing programs.

Customers want to spend their money with organisations who are paying their staff fairly.

The majority of people living below the breadline today are in working households, including 70% of poor children; according to the Joseph Rowntree Foundation, “in-work poverty is the problem of our times”. It is easy to see how zero-hours contract, with no guaranteed shifts, no pension or sick pay, and wages that can vary would be a financially risky and damaging strategy for any family.

Whilst providing evidence to your customers of looking after the mental wellbeing of your teams is not so obviously easy, success in this area would be powerful.

A recent CIPD survey of employees found that a third (33%) said their line manager or employer had not checked in on their health and wellbeing since the onset of the pandemic. And so it’s not surprising that more than four in ten (43%) said they felt anxious about returning to a workplace because of COVID-19. All these affected people will be your customers or within the close network of your customers.

NEED 4 – your brand is one of trust, transparency and advocacy

Communities have come together in 2020 supporting the vulnerable and elderly but conversely there has been divisiveness at a national and global level with political battles, heightened tensions around Black Lives Matter and the climate crisis.

Customers are being more aware of greenwashing which is the practice of making an unsubstantiated or misleading claim about the environmental benefits of a product, service, technology, or company practice. Greenwashing can make a company appear to be more environmentally friendly than it really is.

Buyers of 2021 will be looking for businesses that are transparent and trustworthy. Ones that lead by example and drive the agenda of doing the right thing for our economy, society and planet.

2020 will be a year never to be repeated for our customers.

2021 will be a year that allows our customers to make the purchases that meets their needs.

A business on a sustainable journey will be one which has maximised their chances of meeting their customer's needs

If you would like to understand what your next steps could be you can download our Prepare for Sustainability recommendations here

‍