What women want: the power of the female economy
– Professor Moira Clark is Director of the Henley Centre for Customer Management at Henley Business School. The opinions expressed are her own. Reuters will host a “follow-the-sun” live blog on Monday, March 8, 2010, International Women’s Day. Please tune in.–
“What does a woman want?” was a question that tormented Sigmund Freud despite thirty years of research into the “feminine soul”. He felt he was never able to answer this question, and sadly it would seem that many companies today still haven’t figured it out.
In a nutshell, women are a serious economic force to be reckoned with. Globally, women account for about $20 trillion spent annually on consumer goods; 85 percent of all consumer purchases are made by women, and women represent the majority of the online market. Seventy percent of all US and UK wealth is owned by the over 65s (who are mostly women) and it is estimated that female millionaires will outnumber male ones in the UK by 2020. By 2025, women will control 60 percent of the nation’s private wealth.
The statistics regarding the power of the female consumer go on and on, yet many companies are ignoring or downplaying this extraordinary trend. Could this be because of male dominance in the boardroom (only seven percent of board members are women) or the reluctance to acknowledge that gender really does make a difference when it comes to consumer behaviour?
There are many examples of companies that misjudge the power of the female consumer. The car industry, consumer electronics and financial services offer countless examples of poor service to women – largely not understanding what they want and not knowing how to speak to them.
Too many companies don’t have a strategy that is female-centric; you only have to go into a car dealer as a lone female customer to know what being ignored really feels like. They even have a label for female customers – “tyre kickers”, which is supposed to sum up the fact that these lone customers are time wasters and will only really buy a car if a man is present!
Mobile phone shops are another bastion of male dominance – mostly staffed by young, male technophiles who speak a language only they really understand and that is incomprehensible to many of their female customers.
Companies need to recognise that men and women have different buying behaviours. When men go shopping they tend to dash in get what they want and then leave as quickly as possible. Women, on the other hand, tend to take their time, preferring to shop around, chat with people and look for “the perfect purchase”.
The companies that understand the female consumer are few and far between, but those that ‘get it’ stand to reap significant rewards from this lucrative market. Gaining female customer insight and actioning that insight is at the heart of success for these companies.
Take for example Giant, the world’s biggest bicycle manufacturer. They understand the power of the female consumer. They have bicycles designed by women for women and have fundamentally redesigned the bicycle to be more female friendly – for example changing the frame, the seat and the relative positioning of the handlebars to fit the female form.
Then there is Ford, which is at last recognising that dialogue with customers should be tailored to who the customer is. Ford’s sales staff complete e-learning courses to relate better to female customers and they are endeavouring to recruit more females into their dealerships.
Even Harley-Davidson, long a symbol of masculinity, has added a “Women Riders” section to their web site with riding gear and apparel, advice on riding safely as well as personal rider stories. Harley has done this in response to the growing popularity of motorcycles amongst women, who now buy 10 percent of all Harleys sold, compared to just two percent in 1985.
The growing economic power of women consumers is irrefutable and is here to stay. How companies choose to respond to this will determine their future success. International Women’s Day serves as a timely reminder to the corporate world not to ignore the female economy. It affords us an opportunity to celebrate the economic and social achievements of women and is as relevant in today’s society as it was 99 years ago when it was first launched.