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Consumers rate products, service, experience over low prices: Report

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The report sheds light on the evolving preferences of consumers in India

New Delhi: For Indian consumers, product and service quality, excellent customer service, and easy digital experience take precedence over low prices, according to a report by Qualtrics, a Seattle-based experience management company.

Titled the 2024 Consumer Trends Report, the report is based on responses by 1,200 Indian consumers.

The key drivers for making purchase decisions in 2024, as identified in the report are as follows:

Product & Service Quality: Consumers in India prioritize the high quality and excellence of products and services when making purchasing decisions, with a significant 57% emphasizing this factor.

Customer Service Support: About 53% of Indian consumers value effective customer service support, ranking it as a crucial consideration in their decision-making process.

An Easy Digital Experience: Ease of a digital experience plays a substantial role with 34% of consumers prioritising seamless interactions and transactions in the digital realm.

Price: While price remains a factor, it takes a backseat for Indian consumers, with only 29% considering it a primary driver when choosing products or services.

Social responsibility: For as many as 26% of Indian consumers, a brand’s positive impact on society influences their purchase decisions.

These findings challenge the conventional belief that price is the primary factor influencing consumer choices, emphasizing the growing importance of overall customer experience.

Key learnings for businesses

The Qualtrics study identified areas on which retail organizations must focus.

Maintaining the human touch: In the realm of AI adoption, addressing consumer concerns about losing the human touch is crucial. While 64% of Indian consumers are comfortable engaging with AI-powered services, their primary worries include the potential loss of human connection, job displacement, and misuse of personal data.

Listening to consumers: Since 2021, the direct feedback share from consumers after a negative experience has dropped by 7 percentage points to 53%. Despite this, consumers are providing feedback in less direct ways, such as in call centre conversations, online chat, product reviews and social media posts.

“Consumers in India expect more than ever from the organisations they engage with. Brands need to find ways to capture valuable customer feedback in all the places where it’s being shared – such as through surveys, on social media, call transcripts, chat logs, and review sites – and combine it with operational data – such as average spend and visit frequency – to gain insight into what consumers are doing and better understand how to serve them better,” said Moira Dorsey, Principal XM Catalyst at Qualtrics XM Institute.

Offering human support: While digital channels contribute significantly to revenue and have an outsized impact on loyalty, the study indicates consumers are less satisfied with their digital support experience compared to human-assisted interactions. Addressing this trend is pressing given the increasing reliance on digital channels by brands around the world.

Satisfying internal customers: The Qualtrics report also highlights a critical barrier organizations need to address—raising morale and enabling frontline employees. Frontline employees play a pivotal role in shaping customer experience.

However, the research indicates that this group is less satisfied with pay, development opportunities, and support compared to non-frontline employees.

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