Brand loyalty a recession – and post recession – casualty?

May 28, 2009 by Dirk Singer

The other week I posted about a Y&R book talking about the impending brand bubble, where the authors held up the huge gulf in what companies think their brand equity is worth and how consumers value it.

An interesting study that supports this comes from Experian who looked at how shopper habits will change post the recession. And the conclusion that they came to is that brand loyalty will remain weak even once things pick up again.

According to Experian owned Future Foundation:

“More than a quarter (27 per cent) of UK consumers are more likely to have shopped around for the best deal on a product during the last six months than was previously the case. A quarter are spending more time choosing products, and 80 per cent have become increasingly aware of the price of goods.” (From The Retail Bulletin)

And The Future Foundation reckons that this behaviour is now the norm. Keeping consumers’ attention will be harder from here on in, even once the recession has ended.

As analyst Joe Staton says, post the recession: “The biggest casualty will be brand monogamy as consumers demand higher levels of service than ever before, and drop brands we do not believe fully appreciate and reward their custom.”

The Future Foundation says that this points to a need for brands to push multiple benefits at the same time: So price + service + rewarding loyalty.

Image – Untitled Projects