In March 1962, John F. Kennedy delivered an address to Congress where he said consumers are the largest economic group, affecting almost every economic decision, yet their views are often not heard.
JFK’s words still ring true. As our own politicians gear up for the election, the treatment of consumers by private and public sector organisations must once again be front and centre of the political battleground.
Successful businesses know that by giving people the products and service they want, at a fair price, they’ll have happy customers who are more likely to stay loyal. But firms harm their own reputation and damage trust in their industry when they neglect the basics and fail to put the customer first.
Arming consumers with better information
To earn the trust of consumers then they need first to convince the public that they have nothing to hide.
At its worst, poor information can lead to serious consumer detriment as we have recently witnessed with the horsemeat scandal.
But, even when the information is accurate, it is often provided in an unhelpful way – for example, it’s virtually impossible to accurately and easily compare the cost of different bank current accounts. Doing much more to arm people with information they can use to make better choices would represent a significant shift in attitudes from businesses towards their customers.
Businesses must offer genuine choices
However, people power can only be exercised if there is also genuine choice in a market. The rise of challengers in the food retail market is one example of where providing something distinctly different and simple can turn a market on its head.
But in essential markets like energy and banking, many consumers feel there is no point in switching to another supplier because there is no discernible difference in the service and they can’t always tell if the price they will pay is fair.
Listening to consumers
So information alone is rarely enough. Businesses must also listen to their customers. Consumers want products and services that make their lives easier, provided by firms that treat them fairly and with respect.
For business, getting this right can bring great rewards: people say they are twice as likely to choose responsible, ethical, sustainable brands over their competitors. People are also far more loyal to brands that demonstrate responsible, ethical behaviour.
It’s 50 years on from JFK’s speech but it’s never too late for businesses to learn from the basic consumer principles of information, choice and a right to be heard that he set out.
More consumer power is essential for building trust in business. Markets that work well for consumers are good for the most responsive, innovative and efficient businesses. And that is good for growth in the economy.
This piece originally appeared on the CBI’s Great Business Debate website. Richard Lloyd attended the CBI’s event, debating with CEOs from major companies on what more business can do to rebuild consumer trust.