Just 8% of consumers consider themselves committed loyalists to their favourite brands, according to Nielsen’s Global Consumer Loyalty study.
Everyone else is ready to play the brand field and actively looking for a good reason to try a new brand at the expense of what they’re used to.
One reason is that switching is now seen as less of a risk due to rising incomes relative to the cost of many products, especially in emerging markets.
A significant 42% of global consumers say they love to try new things by switching, and almost a further half (49%) say that, while they prefer to stick with a brand they like, they can still be persuaded to shift in order to experiment.
Asia-Pacific consumers have the highest readiness to change their brand, with 47% willing to try new brands and switch. Consumers in Africa and the Middle East were next (45%), followed by those in Latin America (42%); those in North America and Europe tended to be relatively less likely to switch brands (36% and 33% respectively).
“With the overwhelming majority of consumers actively or passively open to unfaithful actions, the risks for brand owners have never been greater,” said Joe Ellis, Senior Vice President, Nielsen Consumer Insights.
Ellis attributed part of this to a so-called "Amazon effect", which expands choice and allows consumers to compare prices efficiently. But he believes more is at play than this phenomenon.
“It’s WeChat groups in China on the hunt for deals or even brokering deals,” he said. “It’s unbranded fresh food, delivered to the door in the UK at prices that go head to head with supermarkets. And it’s traditional grocery retailers trying to find ways to retain profitability levels in a world where home delivery undermines margins.”
Around the world, 39% of consumers name value for money as the overriding factor influencing their choice of brand, followed by better quality (34%), price (32%), and convenience (31%). Only 28% of people said they are influenced by a brand being well known and trusted.
Regionally, only consumers in Asia Pacific don’t list value for money as the biggest influence on what they buy; 42% instead opt for enhanced or superior quality.
Ellis underlined the implications of not rethinking campaigns that focus on winning or retaining loyal customers: “The drag effect of consumer demand for choice and voting with their wallets will overwhelm existing marketing and product development efforts if brands don’t more aggressively address disloyalty in the marketplace.”
Sourced from Nielsen; additional content by WARC staff