They say only two things are certain in life: death and taxes. That second part is especially true when it comes to the annual budget speech, which always seems to bring with it some additional pressure on consumers.
This year saw Pravin Gordhan declare his aim to raise an additional R28 billion in taxes. While the highest earners will have to cough up 45% of their earnings, everyone else will feel the pinch of a 5% increase in dividend withholding tax, as well as a higher sin tax and fuel levy.
It's a tough pill to swallow, at least if social media reaction is anything to go by. But it's not all bad economic news. BankservAfrica's Economic Transition Index data shows signs of an economic upturn. And we've seen much heavier rains than this time last year, which means food prices could bounce back a little from the effects of the drought. However, even if the heavier rains bring farmers some much-needed relief, it's still going to take some months for the cost savings to ripple down the supply chain to consumers.
All of this has had an obvious effect on retail. According to the TransUnion Consumer Credit Index, household cash flow is at its lowest level since 2009. This has led to them shopping more at low-cost supermarket chains. Consumers simply don't have the disposable cash to throw around, and that's made them choosier than a Tinder user.
So how can you get them to swipe right on your product or service? You could just slash your price, but that's not going to prevent your competitors from doing the same - just look at the vortex effect that's been occurring in the telco sector, with tariffs plummeting, as providers race to be the cheapest. With products and services becoming more commoditised every day, low prices aren't quite the differentiators they used to be.
Businesses need to think beyond the usual specials and discounts and answer a more fundamental question: how do you get customers through the door in the first place? And that's one area where IT can play the role of enabler.
Don't take customers for granted
First, forget all that nonsense you read about playing hard to get. Healthy long-term relationships are built on mutual respect, and that means constantly nurturing engagement with customers. If you're not approaching consumers from a place of customer-centricity, you might as well not even bother.
Consumers simply don't have the disposable cash to throw around, and that's made them choosier than a Tinder user.
Yes, your business may dominate the market today, but there are always new digital rivals just around the corner, wearing sharper suits and offering something new. Just last month saw the launch of SpreeMAN, for example, offering a tantalising alternative to brick-and-mortar menswear shops like Truworths and Markham.
Just like any other menswear line, SpreeMAN has some famous faces promoting its clothing lines - Kyle Deutsch, Siya Kolisi and Tbo Touch among them. The digital has become real, which means the physical needs to up its game.
Up your physical attraction
Alright, now that you've recognised you're just one of many suitors vying for the attention of a customer, you need to figure out how you can actively attract them to your products or services. In the dating world, that means upping your physical attractiveness. In the business world, that means upping your 'phygital' attractiveness. Consider how the business can use digital to entice people to its physical spaces and offer them seamless experiences that will have them coming back for more.
One great example of a company that's getting this right is McDonald's. When I was in Paris last year, I got to eat at a McDonald's with a difference. Instead of standing in a queue waiting to order, all I had to do was punch what I wanted at a self-service touch kiosk. I could customise as I wanted, pay using my phone, and collect it all at the counter when it was ready. It was fast food at its fastest.
That's not the only way McDonald's is using digital to enhance its unique selling proposition. From apps that deliver free vouchers to partnering with UberEATS for next-level delivery services, the fast food giant is continuously blurring the lines between digital and physical, to deliver better service. And as a massive multinational company that doesn't have the flexibility or willingness to onboard all these digital technologies itself, it is partnering with more agile start-ups, using strategic partnerships to overcome its own limitations.
Okay, so now that we know what business can do to make itself more attractive to customers, how can IT enable this romance? For a local roadmap, we need only to look at how Mr Price is merging physical and digital to enable a more seamless customer experience in-store to great success. The clothing retailer uses an out-of-the-box end-to-end touch-screen POS platform to more quickly process payments in-store. At the same time, it's put in place integrated ERP systems to streamline logistics and delivery systems to make them nimble and responsive.
Can you say the same for your business? Are you providing the data it needs to drive things like customer campaigns, product targeting and volume-pricing mix? When looking at your own IT initiatives, are they giving your organisation what it needs when it needs it, to make the kinds of strategic business decisions that will delight customers?
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