Our world of several decades ago has drastically evolved due to advances in technology but the advent of Generative AI promises even more changes in a very short period of time that will impact lifestyles. Along with a report on Banking Trends, Accenture has published a report on Lifestyle Trends 2024, the highlights and some consequences of which I share below.

Inflation has hit the world’s economies hard and consumer prices have taken the brunt. Without exception, everyday products have registered significant price increases and have hurt the wallets of people. As the grumblings from unhappy customers grow louder, companies resort to a “shrinkflation” pricing strategy.

And what is shrinkflation? Accenture describes it as a reduction in the quantity or size of a product while retaining its price. Surely you must have experienced this but only meticulous customers would take notice. Next time you order your favorite dish in a restaurant, check out the ingredients. Or when you munch on a burger, its size. Or when you nibble on some french fries, the number. Are they smaller in size or fewer in number? Are the omnipresent sachets really just to make the product more affordable? Try adding up the quantity in several sachets of a product and compare that with the quantity in its regular size bottle or box. I wouldn’t be terribly surprised if the sachet comes out to be more expensive on a comparable per unit basis. It happens even to lipstick. My “kulit” daughter tells me that when her favorite US brand proudly announced a new packaging, the size of the “improved” lipstick actually was reduced.

Of late, this unpleasant practice has been bestowed a nastier label by US-based National Public Radio’s Public Money — “skimpflation” — which is characterized by a decline in the quality of a product or service.

This could mean swapping quality ingredients for cheaper alternatives or compromising on quality assurance processes to save time and money. And how many times have we experienced “surge pricing,” the practice of charging higher ticket prices for peak sports and cultural events or higher prices for “new and improved” product offerings?

Customer service has also deteriorated as evidenced by a US National Rage Survey which revealed a high degree of customer dissatisfaction over companies’ lackluster responses to complaints resulting in an estimated $887 billion in lost revenues up from $494 billion in 2020.

I don’t know of a similar formal survey in the Philippines but there is popular empirical evidence that suggests an equally high level of dissatisfaction with customer service, particularly of companies with a high volume of transactions such as banks, airlines, public utilities and broadband streaming services.

Customer service has also deteriorated as evidenced by a US National Rage Survey which revealed a high degree of customer dissatisfaction.

When was the last time you had to endure being passed from one chatbot to another or made to wait on the line endlessly? Unfortunately for the hapless Filipino consumer because of the oligopolistic market structure of most industries, unlike in the US where competition thrives, shifting to another brand is not an option. We either just drop the service entirely, which is not a realistic recourse, or we harbor ill feelings towards the brand. Either way it does not promote goodwill and is highly dysfunctional in the long run for the company that represents the brand.

In the Accenture survey, the level of trust in companies that sell products of mass appeal is consistently low across several varied sectors, i.e., only 14 percent for favorite tech brand; 15 percent for favorite fashion brand; 13 percent for utilities; 15 percent for travel providers; 22 percent for financial services; and 22 percent for food retailers.

The disturbing conclusion is the prevalence of customer mistrust in these companies. I wonder what Filipinos most distrust? I can only guess that high up on the list would be the government, its agencies, and its officials and personnel.

So what does Gen AI have to do with all this? While businesses, as well as governments, are expected to provide service, they have to do so without losing money. Thus the chase to squeeze costs that is causing pain to those intended to be served. The challenge is how to balance satisfying both ends.

Gen AI with its ability to efficiently granularize critical marketing data on processes, logistics, sales patterns, customer reactions to pricing, branding and the like, promises to provide the necessary analytical tools to achieve a balance between cost and service.

Until next week… OBF!

For comments, email bing_matoto@yahoo.com.