The Customer Is Always Wrong

How many times have we purchased the wrong items, merchandise we don't need, or things we already have in excess?

Some women would do these types of purchases frequently while some men would tend to overspend because they don't understand what they get for the product cost.

These characteristics should throw light on my analysis of today's shoppers, that they are always doing the wrong transactions. It is irrelevant as to whether the purchase was on impulse or because of great salesmanship. The bottom line is the purchase decisions are often wrong.

As a customer myself, I find my frustration builds up every time I go shopping.

Many times I feel lost with the product communication.

Plenty of money is spent on research and analysis, studying consumer behavior on habitat, spending power and household income and education, in an effort to determine and justify the next purchase or selection of merchandise.

But what is exactly inside the mind of the customer? What drives and instigates a purchase? How do retailers convert the customers *want' to become a *need'?

Despite all the necessary elements - such as ability to purchase, products, supply and demand - I believe that the concrete action of a purchase will take place if the dreams and aspirations of the customer converge with the messages presented by brand owners or retailers through the products.

Billions of dollars are spent annually on product marketing; some of this effort had successfully achieved the objective of promoting sales.

Some market studies get lost in the attempt to drive sales revenue when attention is diverted to short-term single transactions on impulse, rather than focusing on understanding and replicating repeat transactions.

Let's take the renowned luxury brand Louis Vuitton as an example; the brand communication is clear and subtle.

The brand have been at the top of shopping list for many women as the most aspired handbag to own.

The brand LV prominently carries an impeccable image that addresses dreams and aspirations to these customers, hence they spend on multi transactions simply to be seen wearing the LV logos on their shoulders.

It's about creating an attitude and lifestyle, making the customer understand the whole process of brand exposure, making impressions, and eventually driving sales.

In this case, the concrete action of making a purchase takes place. This shows the difference between good retailers and great retailers.

A shoe retailer once said it only takes 10 minutes to complete a sale to 80 percent of walk-in customers.

The remaining 20 percent would either just browse, or cancel the purchase. A great retailer would concentrate and experiment on attempting to reduce the 20 percent to 10 percent, whilst the good retailer would focus on the 80 percent and forget the 20 percent.

The great retailer would try to ensure that the customers receive the best shopping experience, and ensure the purchase is done really well, with a higher probability for repeat transactions in the future.

The well-known phrase:"The Good is the Enemy of the Great", is possibly nowhere more applicable than in retailing.

With the global population nearing seven billion, world demand for goods and services is swelling. The movement from developing societies (with traditional retailing) to highly developed societies (with modern retailing) continues apace.

Demand alone has been the primary driving force behind good retailing globally. A new trend in retailing will change the global game. In principle, it becomes an urgent priority for brand owners and retailers who aspire to survive and thrive in today's competitive and difficult economic conditions to aim high and to become great, since good *on its own* will no longer be acceptable to the customers.

In most cases, the advance is in recognizing important distinctions, and responding appropriately, and distinctly, rather than leaving it to customers to sort it out by themselves. As the world changes to new technologies, consumer shifts, and new competitors, new conventional wisdom will shape the way we see retailing today.

We all have been there - misinformed, subject to miscommunication, misjudged - hence we have made all the wrong purchasing decisions wasting money and worst of all, time. The future of modern retailing should be in the hands of the customers, we should decide on the interventions or sales pitch to create the necessary impact on exposing the products, making impressions on the merit of the products, and lastly reinforcing an undeniable drive to complete the transactions.

I, for one, as a customer, wait for that day to happen.

Asian Economies Rebound In Spite Of The West

Before the current recession, some economists speculated that Asia's economies had become so vibrant, and trade among them so important, that the region could shake off its traditional dependence on the U.S. and continue to grow quite nicely no matter what happened in the world's largest economy. That "decoupling" theory got tossed out the window as soon as the worst of the Wall Street meltdown bit into U.S. consumer spending in late 2008, sending most economies in Asia into recessionary spirals. Asia found out to its dismay that the region was still far too reliant on exports of PCs, blue jeans and plastic toys to the U.S. to thrive in the face of an American slowdown. Decoupling was laughed off as a fantasy.

But enthusiasts of decoupling may get the last laugh. As Asia inches toward recovery, it is becoming clearer that, in certain respects, the decoupling theory had some merit, and more important, that Asia will very likely become more decoupled from the U.S. as a consequence of the recession. "Yes, decoupling missed big parts of the picture — but so did 'decoupling R.I.P.,' " commented Hong Kong–based Merrill Lynch economist T.J. Bond. "Without it, you can't understand what happened in Asia since September 2008." Read this

The most obvious sign that Asia can generate growth without the West is the relatively robust performance of the region's biggest economies. China achieved 6.1% growth in the first quarter even though exports have plunged at least 17% every month this year. India, in the quarter ending in March, beat estimates with 5.8% growth, and even Indonesia, not considered one of Asia's healthiest economies, managed 4.4% growth. Though such rates are far below what these economies had produced before the recession — especially in the case of China — they still place these countries among the world's best performers.

That growth is being driven primarily by demand from within their own borders. Part of the decoupling thesis was that Asians had become wealthy enough to maintain an acceptable level of growth even if exports to the West sank, by buying and selling goods among one another. Though that was an exaggeration — consumer spending in the region can't fill the gap left by falling exports to the U.S. — domestic demand appears to be holding up Asian economies amid the global downturn. Take China. In May, industrial production jumped 8.9% from the same month a year before, even though exports dropped 26%. The reason is that Chinese factories are churning out goods for domestic consumption. Retail sales increased a hefty 15% in May. Consumer goods of all types are selling like hotcakes: passenger-car sales surged 47% in May from a year earlier, while sales of furniture rose 33% and jewelry 29%. Household-survey data from the first quarter show that spending in rural areas is trending upward. "Consumption is certainly becoming a more important engine of growth," noted Goldman Sachs economists in a June report.

Even more important, there are budding signs that the growth in China is beginning to stimulate economies around the region, as decoupling theorists had predicted. Though a richer China, once again, can't completely replace the U.S. as a source of demand for Asia's smaller economies, it can provide for other Asian nations new customers that didn't exist in the past.

Research from Merrill Lynch asserts that Asian exports in April began to tick upward from the earlier months of the year, even though those to the U.S., Europe and Japan continued to decline. How can that be? The revival, Merrill said, is due to a jump in exports to China from the rest of the region. "The rise in Chinese demand has been the major driver of the current phase of Asian export recovery," Merrill contends. (Japan has traditionally been a strong source of demand and investment for the rest of Asia, but it too has become interwoven into Asia-wide supply networks, with exports to China an increasingly important element of its growth.)

There is a chance that this boost to the region from China could be temporary, a result of the massive but short-term government stimulus Beijing is using to revive the economy. For example, China's roaring car market is being fueled in part by government subsidies and tax breaks, measures that are part of Beijing's wider stimulus package. But the government is also taking longer-term steps to encourage greater domestic spending, which could turn China into a more important destination for Asian exports in the future. Beijing is spending $125 billion over the next three years to expand its health-care system to cover 90% of China's population. With medical costs still a major financial burden on the country's poor, the improvements could well persuade Chinese to spend more and save less.

Other Asian economies are positioning themselves to tap into that new, and potentially very large, pool of customers in China. Take Taiwan. After getting slammed by the collapse of American consumer spending — first-quarter GDP plunged a record 10.2% — it has become a priority government policy to find new buyers for Taiwan-made goods. "We were hard-hit by the shrinkage of the export market in the U.S. and Europe," Taiwanese President Ma Ying-jeou told TIME in May. "So one lesson we learned is we should diversify our export markets." China is clearly on Ma's mind. He is pursuing a comprehensive economic agreement with China that would reduce tariffs on Taiwan's exports to its giant neighbor. China has been a major destination for Taiwanese manufacturers, but to a great degree those exports were components that went into final products assembled in China and shipped to the West. Now, says San Gee, deputy minister of Taiwan's Council for Economic Planning and Development in Taipei, policymakers want Taiwanese companies to sell more directly to Chinese consumers. "The Chinese market is a very important market for us to build our brand names," he says.

What all this means is that Asia is looking more to itself for future growth. In other words, the region is becoming increasingly decoupled from the U.S. The American economy "matters a lot less than people thought," argues Andrew Freris, senior investment strategist for Asia at BNP Paribas Wealth Management in Hong Kong. Decoupling has shifted from a concept to a policy, and that fact may prove to be one of the most important consequences of this great recession.