Consumer confidence declines amidst price hikes – how can brands win over customers?

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The latest ONS figures show that retail sales declined by 3.7% in December, meanwhile GfK’s Consumer Confidence Index has dropped four points to -19 as the cost of living increases.

Retailers are fully aware that at this time of year, revenues will take a hit due to consumers spending less following the expensive festive period. However, despite England’s plan B restrictions lifting, customers are even more reluctant to spend with energy costs continuing to rise and inflation at a 30 year high.

“With inflation, price hikes will undoubtably follow – meaning there must be a continued focus on empathy as part of the customer experience. While organisations may not be able to exert control over many of the variables affecting inflation, they can provide clear and regular communication, flexibility and understanding to their customers.

In 2022, resolving frustrations and ensuring that customers feel heard and valued will have higher stakes than ever – particularly when you consider that last year, 30% of customers ditched brands they had previously been loyal to due to poor customer service. It’s not about delivering the impossible, but about having the data and tools to be able to communicate empathically and provide options and flexibility. As such, technology will open more doors for companies to deliver personalised experiences that secure customer loyalty even in the face of inflation.