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Age of the Customer

Why market share doesn’t matter … customer relationships matter

Brand / Market Share

Historically brands and / or companies were “rated” by their brand / market share. The business logic was the higher the market share, the “better” the brand / business was being managed. Big brands / companies such as Nike regularly stated they were “market leaders” to highlight their success.

Age of the Customer

Due to a number of factors, driven by the internet, consumers are now more informed than ever. This has led to consumers engaging differently with brands / companies. Consumers are more likely to research a product / service online before purchase and have more information available. For example, 45% of people use online reviews before purchasing a product instore (Bazaarvoice). By having more information during the decision-making process the power has now shifted from the brand / company to the consumer. Due to this fundamental shift in power many label today as ‘the age of the customer’.

Jim Blasingame, in his book Age Of The Customer, explains the shift as the consumer now controlling the product information and UGC (user generated content) during the decision making process. Historically, the product information was controlled by the brand / company and UGC was not widely available. Jim explains that:
‘This paradigm shift is largely caused by online platforms that are:
1) Increasing the access customers have to information about Sellers and their products
2) Allowing customers to express and share what they’ve learned about and experienced with a business’

Age of the Customer

 Source: Age Of The Customer

Customer relationships matter

Due to the age of the customer successful businesses are now focused on building better long-term relationships with their customers. By utilising a customer centric strategy they are able to achieve long term sales / profitability by ensuring the customer is satisfied at every step in the buying process. The buying process has now grown to include online research before purchase and also engaging with customers online, e.g. Facebook.

John Hall, in his book Top of Mind, suggests companies should now adjust from “me marketing” to “you marketing”. The simple logic is that businesses are not managing a brand or company but rather are managing a relationship with their customer. John eloquently explains the logic as
“People don’t care about your products and services: they care about their needs.”

Australian Example

Most Australian readers will agree that due to the internet customers are more informed. Some Australian readers will question whether customers have more power due to the limited level of competition in Australia.

Australia has one of the most concentrated supermarket (grocery) industries in the world. Depending on which data source is used, Coles and Woolworths had approximately 70 – 80% share of packaged groceries in 2000, when Aldi entered Australia (factcheck). Using ‘the old’ brand / market share thinking Coles and Woolworths were well managed and Aldi was not a threat.

Today Aldi has grown to be a successful retailer in Australia. Aldi Australia now operates 500+ supermarkets on the Australian mainland (Aldi). Roy Morgan research suggests Aldi has 12.1% market share, estimated sales of over $8 billion. Business insider even reports that Aldi is more profitable (% not dollars) than Coles and Woolworths. So how did Aldi achieve these long term financial results in such a concentrated market? Tom Daunt, Aldi Australia CEO explains:
‘If you look after employees you have a better customer experience, if you look after customers they repay that favour and come back next week and spend their money with you, so that’s the long term approach we take.’

Simply put Aldi put their relationships with their customers first. They did not follow the “market leader” or launch a “me too” supermarket. Aldi Australia created a unique business (in Australia) based on the needs of their target market. This business approach has also resulted in many customer awards such as:
2018 Most trusted brand in Australia, Roy Morgan
2018, 2016, 2015, 2014 Most satisfied supermarket customers in Australia, Canstar Blue

Another way of viewing this is that once loyal Coles and Woolworths shoppers were willing to trial and sometimes switch to Aldi for the majority of their grocery shopping. Roy Morgan (2017) research has highlighted that 72.7% of grocery buyers shop at Woolworths during the year but 8.0% only shop at Woolworths. Similarly, 70.0% of grocery buyers shop at Coles during the year but 6.6% only shop at Coles. So, today the “market leaders” are focusing on building better relationships with their customers. For example, Woolworths uses its ‘Voice of the Customer’ research to determine how satisfied their shoppers are.


Historic measures, like brand / market share, do not always indicate a well-managed business.

Changes in technology have increased the power of customers. Empowered customers mean modern businesses should adopt a customer centric strategy. The benefit for these businesses is that they will achieve the best business results in the long term. Others that focus on historic measures, e.g. market share, may not be able to compete in ‘age of the customer.’


The information provided in this blog post was general in nature. If you require more information I offer a free initial consultation by completing a contact us form.

Thank you,

Tim Bowen