Customers today have more choices than ever. Not only that, they have more information about those choices than ever. And they can get that information anytime, anywhere, and on whatever device they happen to be using at the moment. These changes have collectively put customers in the driver’s seat.
If you’re a fan of strategy guru Michael Porter, you can think of this as a shift in one of his five forces of competition: buyer power. But even without a sophisticated analytical framework, you can feel this change in your daily life. That’s because you’re a customer, too, by virtue of the fact that you buy goods and services, day in and day out.
Try comparing the power you used to have as a customer with the power you have today. I recently tried this exercise by comparing the way I picked my bank in 1998 — when I moved to the Boston area for a job — with the options I have for picking a bank today.
In June of ’98, I wanted to switch to a local-area bank but didn’t know where to begin. I dreaded doing the research on top of moving my home and starting a new job. The woman who recruited me suggested that I sign up with Bank Boston because it had the most ATMs in our area. With a sense of relief, I did just that and went on with my life.
Over the intervening years, Bank Boston was acquired by Fleet Bank, which was later acquired by Bank of America. Today that makes me a Bank of America customer, even though I never decided to do business with it. Fortunately, the relationship has worked out okay. But what if it stopped being okay and I wanted to switch? How hard would it be to pick a new bank and switch in 2012?