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Consumers everywhere have a wealth of information readily available, giving them more control than ever regarding who gets their business. They know they have choices and switch providers when frustrated with their experiences.
The result is the emergence of what Accenture calls the Switching Economy—the $5.9 billion of consumer-oriented commerce that is annually up for grabs globally due to dwindling consumer satisfaction with and loyalty to their established providers.
Read more to find out how companies can keep pace with today's all-powerful and ever-changing consumers—who recognize and reward companies that meet them on their terms and punish those that do not—by adopting a new customer model that effectively leverages social media.
Accenture’s 2013 Global Consumer Pulse Research—that included more than 13,000 consumers in 33 countries—revealed that 66 percent of consumers globally have switched providers because of poor experiences in at least one of 10 industries surveyed.
An overwhelming majority of consumers (85 percent) said they switch providers because companies simply do not make it easy to do business with them.
It is not for lack of effort on providers’ part. Most companies have failed to keep up with consumers’ expectations and behaviors because they have been playing “not to lose” when developing their customer relationships.
Social media has become one of the many ways consumers get information and interact, and it is no longer a distinctive, separate channel according to Accenture’s 2013 Global Consumer Pulse research.
Nearly two-thirds (63 percent) of consumers said they use online information from sources such as expert-review or product-comparison sites.
Just under half (48 percent) said they use online information from social media sites to learn about products and services.
A slight majority (52 percent) of consumers are using social media at least several times a month to interact with family and friends for private purposes (66 percent for emerging markets consumers).
Close to 30 percent of consumers are influenced by positive or negative comments on social media about companies or brands, affecting both consideration and purchase decisions.
About four in 10 (42 percent) consumers globally (and 63 percent of emerging-market consumers) read about companies’ products or customer service delivery on social media sites at least several times a month.
One-quarter globally (and 40 percent of those in emerging markets) said they write about customer service delivery or personal experiences on social media sites at least several times a month.
One-quarter of consumers globally (and one-third of emerging-market consumers) interact directly with companies on social media sites or other digital channels about their products and services at least several times a month.
Twenty-six percent said they like seeing companies get directly involved in contributing to discussions on social media.
Twenty-three percent said they are more likely to do business with a company that they know they can interact with in a social media environment.
For providers, social media can be a blessing or a curse.
About three in 10 consumers in our survey said positive or negative comments on social media about companies or brands influence them, contributing to their consideration of a product or service as well as their decision to buy a particular offer.
Almost one in three consumers trust comments made on social media by people they know.
Consumers’ expectations and needs have changed over the years, leaving many companies struggling to keep up. Companies wanting to play to win need to build the capabilities necessary to create and maintain a strong and consistent social media presence—as well as more effectively leverage the data social media generates—to better engage consumers and help prevent them from switching.
Mining this rich source of data and becoming part of the social media conversation can enable companies to become more relevant to consumers and to evolve as consumers do.
Most companies lag in two areas that are critical to taking full advantage of social media’s potential: ensuring that social media is well connected to other channels, and managing online reviews as part of their social media, not e-commerce, activities.
Accenture suggests that companies should:
Integrate social media with other, more established customer-interaction channels or risk conflicting messages sent to consumers and a bumpy customer experience that can frustrate them.
Recognize that online reviews are a part of social media, not e-commerce, and manage them accordingly. Three actions are critical to helping a company more effectively capitalize on the power of online reviews:
Extend social media management technology capabilities to include reviews.
Shift responsibility for review management from the e-commerce team to the social media team—or at the very least, foster greater communication between the two groups.
Implement new processes for monitoring and leveraging relevant review sites.
July 16, 2014
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