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Relevancy beats personalisation

News, 16 August 2016

LONDON: Consumers are more interested in relevancy than personalisation, according to a new study by the Direct Marketing Association exploring the changing nature of consumer engagement with brands.

The DMA undertook qualitative and quantitative research – the latter involving a survey of 1,000 consumers – to explore the language people use when describing experiences with brands.

This found that 40% of respondents were "actively loyal" to brands for both routine and special purchases, while 27% were "actively disloyal" and tended to have no brand loyalty.

Almost a quarter (23%) of consumers fell into the "habitually loyal" category – loyal when buying routine items but shopping around for special purchases.

The remaining 9% were "situational loyals" who were flexible about routine purchases but loyal for special purchases, although this figure rose to 15% among 16-24 year olds.

The DMA noted that, in general, disloyalty increased with the value of the items purchased. So, for example, 46% of consumers said they shopped around for big ticket items like furniture and 41% for electronic products, but these proportions dropped significantly when asked about shopping around for more day-to-day items like beauty products (21%) and clothes (24%).

And as the relationship between brands and consumers changes, the DMA argued that relevancy beats personalisation; for example, 40% of consumers wanted services that could not only remind them about an upcoming birthday, but give relevant suggestions on what to buy.

The research also showed that customers are willing to share their data when they can see direct benefits such as lower prices, loyalty rewards or special deals.

"It's this point on data sharing that is most important for the future of customer engagement," the DMA said, "underpinning the relationship between brands and their customers."

Data sourced from DMA; additional content by Warc staff