Customer loyalty used to queue repeat purchase based on consumption satisfaction. Now, it’s a conditional high churn rate. Strategy has thus become increasingly complex as a result of, on the one hand, reduced brand royalty, i.e., status regarded by customers as the most sustainable and successful in the market, and on the other hand, enhanced product and customer review, i.e., the taken precedence measuring stick of consistency. Then, the most primal condition ever assailed by man, convenience, is also back in play. Customers nowadays repeat multiple turnovers, instead, to be pragmatic, first, be it noble, loyal, or not.
According to a study of more than 30,000 internet consumers from different regions in over 64 countries around the world, Nielsen Company, Thailand, has found that the rate of brand change of heart, or customer churn, is on a constant rise where only 8% of consumers around the world believe in brand royalty or still loyal to a brand. As little left for what it’s worth, the survey depicts a somber presage for brand loyalty. Let’s take a look at 3 key success factors to take advantage of the high churn rate.
1. Customers churn for novelty
Over 42% of the survey participants like to churn, i.e., try new things, while 49% would churn interesting options even if they were already loyal to a brand. To retain fickle consumers given to novelty, a brand must not only constantly churn out new options, buy also stay true to it’s unique identity as well, i.e., amplifying brand image in the same token. Killing two birds with one novel stone is far more effective than allowing customer churns to the competitors’ leverage.
2. Price is a plus but quality is a multiplier.
Price is an important element that influences the purchasing decision. However, while 43% of the survey participants found promotion discounts encouraging, 52% were given to value and quality of the product. That said from a branding perspective, long term satisfaction and loyalty is contingent on the quality of the product in the context of how reasonable the price is set. The brand’s job thus is to do its homework on is considered quality and what’s the most reasonable price it can be offered for. The right combination will bare direct impact on the value of the product perceived by the customer.
3. Online presence
Consumption behavior has changed with online applications that play an increasing role by the minute in the lives of customers. From simply making a trip to the store for something needed, customers now research the internet, get a second, third and quadruple opinions, and compare multiple reviews prior to making a decision.
The survey also found that 32% of consumers are attracted to brands that offer products online. Online presence is paramount in terms of encouraging experimentation and consumption. To build a credible brand image and become a key player in an expanded market, every business has to commit to an online presence with easy access. With it, businesses can offer otherwise complex services, e.g., omni-channel and swift return, to give consumers a seamless service between offline stores and online marketplaces. They take their online muntra to heart, “the more online access, the more hearts and minds to churn”.
On the other hand, given the rapidly expanding fickle consumption and multiplying choices, competition and marketing efforts are also on the rise at the same rate. A brand thus has no choice but to continually develop products to remain relevant, have a shot at maintaining royalty and loyalty and perhaps welcome customers who are ready to have a change of heart. It’s a great time to embrace the new age of brand churning. That means, of course, back to your brand, too, over and over again, versus a permanent change of heart.
Compiled by BLOG.SCGLogistics
References brandbuffet.in.th, marketingoops.com, globthailand.com
Photos freepik.com, unsplash.com