Page 1: Changing customers expectations
The 1980s were marked by a growth in consumer spending and a housing boom. Easy access to credit made it possible for people to realise their dreams and encouraged them to spend. With the downturn in the economy came fear and uncertainty about unemployment and the harsh realities of recession left many consumers with debts and homes which had been transformed from investments to burdens.
In the 1990s these experiences have left their mark on consumers. There have been changes in outlook and attitude towards spending. For many, purchases have to be justified on a need rather than a want basis. Customers primarily seek best value for money. Best value for money, in the customer's eyes, is not reflected by price alone. It is a combination of quality (product durability, benefits and service) against the best price. Customers are more willing to shop around for goods to get best value and there is greater reluctance to purchase on impulse.
Satisfying customer needs has become a major strategy for organisations to compete in the rapidly changing markets of the 1990s and, as price is only part of the "value" equation, organisations realise that they cannot compete on the basis of their products and prices alone.
This case study focuses on MFI's Sales Division Strategy launched in 1993. This strategy is based on the simple realisation that the future success of MFI's business depended on MFI's ability to meet and exceed customer expectations profitably. The purpose of every organisation is to fulfil the needs of customers who in turn make it possible to achieve the aims of the business.
When businesses such as MFI become larger, it becomes more difficult to answer simple questions such as:
- Exactly what is it that I do?
- What have I actually done?
- How do I know I've really done it?
- Who among my customers will confirm it?
- What is the evidence that my skills are state-of-the-art?
The purpose of the strategy was and continues to be to develop systems, structures, processes and an employee skills base which would provide the information and skills to act on these issues. The new strategy would help MFI to focus on the real demands its customers make, with the flexibility to respond to customer needs and requirements within the framework of a larger company.