Brand loyalty used to be common practice among consumers. With fewer services and products available, people would pick a brand and stick with it. The plethora of choice available today means consumer behaviour has shifted and commitment to brands has waned. Just 23% of consumers say they have a relationship with a brand, according to Rave Reviews.
Pre-technological revolution, it was much harder for brands to get their names out there. Consumers were blindly loyal to businesses they had bought from before; they had built a trusted relationship with them and it was more difficult to find competitor’s offers.
The introduction of the internet and communication tools like email, meant brands could be more publicised, reaching a far greater audience than ever. Word travels fast, and consumers find themselves with more choice than ever. Comparing prices, services and quality are much easier – there are even websites dedicated to it.
Rave Reviews conducted a study that found that adults are exposed to an average of 360 brand messages per day. That makes for a lot of competition. The ease of email brings consumers and brands closer meaning personal affiliations can be attained quicker, but there’s a lot of noise to break through. Marketing tools such as segmentation and personalisation (like discount codes and rewards) makes grabbing customer attention easier and retention likelier.
Perks and rewards, suggestive selling, personal discounts and engaging physical spaces are all good for brand loyalty. Today’s shoppers can be fickle in their purchasing practice; they want to find the best deal possible. Customers will buy from the brand that offers them the best deal rather than because they have bought from them before.
“The ease of email brings consumers and brands closer meaning personal affiliations can be attained quicker, but there’s a lot of noise to break through”
With so much competition, sub-standard products now have a short shelf-life. Customer expectation has risen and companies now have to actually compete as to who is better, cheaper and more rewarding. E-commerce means retailers don’t need a bricks and mortar store to sell products. This enables an increased number of small businesses opening whenever they please – giving new and independent companies a chance to thrive and compete with more established names. Generally, competition is high, making attaining customer loyalty a difficult challenge.
Because of this, consumers have become more judgemental and factors such as poor service or items out of stock, can greatly impact brand loyalty. With competitors like Amazon, which offers next-day delivery and rarely goes out of stock, brands need to implement technology to help eliminate inventory issues and make sure they aren’t handing customers over to Amazon. According to Chain Store Age “When consumers had to shop for everything at a bricks and mortar store, retailers could often get away with poor inventory levels and out of stocks… Upwards of 24% of Amazon sales can be attributed to customers who first tried to buy the product at a local store but found it out of stock, according to IHL.“
“Brands need to implement technology to help eliminate inventory issues and make sure they aren’t handing customers over to Amazon”
Consumers are more informed now, constantly on the search for the brand with the best total proposition. Product, service and brand all contribute to the overall perception. This means brands have to be at the top of their game with a strong understanding of their target audience, creating products and messaging that meet their customer’s expectations.