Marketing Viewpoint by Ruth Winett
Tips for Responding to Changes in
When was the last time you bought a business suit? People and their behavior change during times of stress, such as the pandemic. To survive tectonic shifts in customer behavior, companies must recognize changes in customers' tastes and preference and anticipate the impact of these changes on buyer behavior. Here are some businesses that have pivoted or could pivot as customer preferences have changed.
For Zoom meetings conducted from a converted bedroom, one executive wears jeans or sweats and a dress shirt, adding a blazer and tie for more important meetings. As work-from-home became common, a clothing store could have stocked up on athleisure clothes, added or expanded online shopping, and targeted remote workers.
The Cremation Association of North America has seen remarkable changes in preferences. "In 2020, 56 percent of Americans who died were cremated… [compared with] 27 percent two decades earlier, according to the ...CANA," and the percentage of cremations may increase to around 80 per cent in 2040, according to the CANA and the National Funeral Directors Association. Noting this trend, cemeteries could set aside areas where families that choose cremation can place gravestones without the expense of a traditional burial.
Like crematorium owners, owners of office buildings are experiencing changes in behavior. Everywhere office occupancy rates have sharply declined as many companies have given workers the option of working at home. In Cambridge and Natick, Massachusetts, developers want to turn vacant offices and retail space into much-needed labs for biotech companies.
Some changes, such as work from home, were considered temporary. In 2010 Starbucks had "2,400+ stores with drive-thru, which represented 40 percent of its portfolio. And those 40 percent were driving more than half of the brand's cash contribution," according to QSR. The migration to drive-thru challenged Starbucks' original "sit and sip" business model. However, Starbucks adapted and improved the drive-thru experience. By second quarter, 2021, when remote workers resorted to drive-thru coffee, drive-thru accounted for over 50 percent of Starbucks’ sales.
While it is hard to unload or reconfigure unused real estate, nimble companies can find good alternative uses. However, they must first assess whether the changes are permanent. People bought smaller cars during the gasoline shortage of the seventies but later reverted to even larger cars and trucks. Will people ever want to work fulltime in offices? If the changes appear to be permanent, businesses could evaluate alternatives, keeping in mind their skills and resources and their ability to compete in a new area. Finally, they should consider whether the modified business model will be profitable. They should involve all affected departments. A "cross-functional team" at Starbucks is evaluating how to grow their drive thru business.
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