The Impact of Changing Customer Needs & Spending Patterns
- Markets and marketing strategies are constantly changing as a direct result of the changing wants/needs of customers, which affect their spending patterns
- There are many different reasons for changes in customer spending habits and patterns
- There are many different reasons for changes in customer spending habits and patterns
- Businesses that conduct ongoing market research are able to identify and interpret the changes that are happening in markets
Diagram: Reasons for Changes in Spending Patterns
If businesses fail to respond to changing customer needs, then they are likely to fail
Changes in tastes and fashions
- Trends in some markets can change very quickly
- E.g. Wide-leg jeans are now more fashionable with Gen-Z customers than 'skinny' jeans worn by Millennials
Change in disposable incomes
- High unemployment or inflation may lead to customers to buy cheaper products, e.g own brand breakfast cereal
Demographic changes
- Populations in most developed countries are becoming older
- Demand for products that meet their needs has driven many market changes
- E.g. Sales of specialist travel insurance for mature holidaymakers has increased
Global influences
- The arrival of well-known international brands can change demand and purchasing patterns in a market
- Increased travel, support from celebrities and extensive promotional activity drive demand
- E.g. American fast food chains now dominate the market for fast food across Europe
Changes in technology
- New technology makes old technology less desirable or obsolete
- E.g. Products such as smart speakers are replacing sales of radios