The Evolution of Consumer Behavior in the Digital Age

The Evolution of Consumer Behavior

in the Digital Age

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The Evolution of Consumer Behavior in the Digital Age
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‘The Less Than Zero Moment of Truth’

Adapted from Forbes – June 2019

“We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten.” – Bill Gates

One of the best examples of how we both overestimate and underestimate changes in the future is the evolution of consumer behavior throughout this century.

The digital age has altered how businesses market their products. It has completely shifted the playing field and companies have to review their strategies to reach their customers. Imagine the world we were in 15 years. Back in those days, the way shopping was done for products was drastically different from the way we shop today. Everyone still trusted brick-and-mortar stores with no price comparison services, and consumers were at the mercy of large corporations for discounts.

How did we go from that “primitive” world of shopping to the consumer experience we have today in the digital age? There have been major paradigm shifts in the marketing world in the last 15 years due to the emergence of digital technologies and e-commerce platforms such as Facebook, Amazon, and the adoption of smartphones. More specifically, in just 15 years, shopping went from a linear, retail-focused model, to today’s iterative, digital-centric model of customer behavior.

Imagine yourself as a customer in the year 2005. You just walked into a grocery store to buy a bottle of shampoo. You look down the aisle and see over 10 shampoos of different brands and types, and you need to make a decision on which one to purchase.

You may consider several factors when making this decision — the design of the label, the position of that shampoo on the shelf, and the detailed explanation on the label. Coined in 2005, the “Moment of Truth” model is one of the most celebrated marketing frameworks because it so accurately captures the customer’s decision process when buying a product, experiencing a product, and eventually becoming loyal to the brand. This original “Moment of Truth” model does not incorporate digital technologies or the internet into customers’ shopping behavior.

Now, as a customer, you have sufficient access to smartphones and the internet to go beyond the shelf when evaluating the product. In fact, you might not be at the physical store at all since ecommerce stores have also become significantly more popular, serving as viable alternatives to the physical retail store.Therefore, when you need a shampoo, you are unlikely to go directly to the store to purchase, but rather go online to search something like “the best shampoo in the world”. Digital channels such as social media and search engines can now influence the customer decision journey.

The significance of searching on-line is that it is perhaps the first marketing framework that emphasized the importance of digital channels as a critical part of the customer decision journey. This encouraged companies to start considering “buzzwords” such as SEO (Search Engine Optimisation) and SEM (Search Engine Marketing).This is the turning point of the digital age in marketing. A new model popularised by McKinsey in 2009 gave marketers an even more up-to-date way to think about the new, iterative customer journey created by new technologies.

In many ways, the value of a big brand name has diminished somewhat. Marketers will not create a sales spike by virtue of being a big company. Smaller companies have just as much power in making themselves into success stories.Nowadays, customers are bombarded with thousands of pieces of information every single day over the internet, and a customer’s evaluation cycle is significantly crunched from a stage of multiple days or hours to a matter of minutes or seconds.

The significance of this new “accelerated loyalty journey” is that it doesn’t just focus on providing information to help customers evaluate the company’s products. It also emphasizes the importance of delivering that information in the shortest amount of time to the most targeted customer segments. This allows marketers to get these customers to take immediate action and convert. In other words, having the information is not enough. You need to push that information aggressively in front of the customers at the exact moment their needs are generated.

Digital marketing channels provide as much coverage to smaller companies as they do to established brands.Under the traditional marketing mindset, customers behave in a funnel. They start by becoming aware of the product and brand. Then, they eventually go through several steps to purchase a product and become loyal customers.In each of the stages, customers may “drop off” in the funnel. The marketer’s job here is to prevent these drop-offs by optimizing their messaging in each step of the funnel.However, with an enormous amount of decision power and information unlocked by smartphones and the internet, customers no longer interact with companies in this linear model.

These proliferation of huge amount of information has been fueled by the concept of Big Data. This is the biggest game-changing opportunity for marketing and sales since the Internet went mainstream almost 20 years ago. The data big bang has unleashed torrents of terabytes about everything from customer behaviors to weather patterns to demographic consumer shifts in emerging markets. The companies who are successful in turning data into market growth will excel by using analytics to identify valuable business opportunities from the data to drive decisions and improve marketing return on investment (MROI). It will then be turning those insights into well-designed products and offers that delight customers and finally delivering those products and offers effectively to the marketplace.

With good implementation of what is called as ‘’Big Data’’, Marketers will have meaningful information about their customers, financial insights and operationalbehaviour. In marketing, big data comprises gathering, analyzing, and using massive amounts of digital information to improve business operations. It helps in getting a 360-degree view of their audiences. The concept of “know your customer” (KYC) was initially conceived many years ago to provides insight into customer behavior that was once limited to large financial institutions. Now, because of the accessibility of big data, the benefits of KYC are available to even small and medium businesses. Customer engagement, specifically how your customers view and interact with your brand, is a key factor in your marketing efforts. Big Data analytics provides the business intelligence you need to bring about positive change, like improving existing products or increasing revenue per customer.

The 360-degree view from big data allows marketers to present customer-specific content when and where it is most effective to improve online and in-store brand recognition and recall. Big data can help marketers leverage real-time data in cloud computing environments.

Customer data helps marketers understand their target audience. The obvious data of this type are facts like names, email addresses, purchase histories, web searches and indications of audience’s attitudes that may be gathered from social media activity, surveys, and online communities. Proper analysis of these data can lead to improved performance and reduced costs.Whether you are trying to improve customer loyalty and engagement, optimize your performance, or make pricing decisions, big data in marketing has proven to be an indispensable tool.

Analytics is an essential component of big data. It provides business intelligence that results in time and cost savings by optimizing marketing performance.

Big Data is a leading factor to create the ‘’Less Than Zero Moment of Truth’’ which is the influence in a person’s life that causes him or her to start looking for or researching a product or service. Such events are opportunities for a company to actively reach out to a customer via social media, email marketing or target advertisements – even before the potential customer starts searching for information. Such a proactive approach will require data collection, advanced targeting and monitoring of customer activities on social media, but it may drive a potential buyer to your website instead of your competitor’s. The modern customer’s decision process is much more iterative. Customers today hop between different stages of the funnel between multiple companies, thanks to the power granted by the internet. Their decision journey has drastically shifted.

Enabled by advanced technologies such as machine learning and artificial intelligence, more and more companies have started to conduct this type of “hyper-speed targeting” to their audience. This marks a new age of marketing automation and acceleration.

While these shifts in marketing may seem very different, the underlying theme is the same: customers are becoming more powerful in making their own purchasing decisions.

As the information available to customers proliferate, this trend will only accelerate in the next decade, making “customer-centric” marketing even more important for companies to succeed with some major shifts in the marketing approaches in the digital age.

The digital age has changed everything about the way companies market themselves. It has revolutionized the reach of small businesses, while demanding more from already established businesses. While many people have complained about this new world, it has spelled opportunity for many others.

SECTION A – Case Study Questions


(a) Describe the consumer behaviour 5-Stage Model.

[10 marks]

(b) Using examples from the case study critically analyse how Digital Technologies are disrupting this consumer behavior model?

[15 marks]


(a) Distinguish between the different ‘’Moments of Truths’’ in marketing.

[10 marks]

(b) Using examples from the case study, critically analyse the 5 ‘’Moments of Truth’’ in the customer decision journey.

[15 marks]


(a) Evaluate the importance of ‘’Big Data’ in Marketing today.

[10 marks]

(b) Using examples from the case study, critically analyse how Big Data has disrupted the Market and Marketing Research process.

[15 marks]



‘’…every company knows the importance of customer service. What every company needs to know however is, that customer service is not just one department, it is the whole company…’’ (Institute of Customer Service.)

(a) Using the Extended Service Mix, critically analyse how a business organisation can become a World-Class Customer Service.

[10 marks]

(b) Using the Key Characteristics of Service elements describe how SERVQUAL attributes are used to analyse Service Gap in an organization.

[10 Marks]


The definition should be according to authors and should be related to the Extract. Please read the extract carefully before answering. The (a) part can be in general and from extract and (b) should be from extract. Pay Attention

1. Please divide the answers into Question 1,2,3,4 and Part (a) and (b)

2. Allocate the number of words according to the marks.

3. it’s ok to exceed by 200 words

4. please write references based on harvard

5. Need to include diagrams to explain the definition and should be in appendix

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