In 2022, consumer loyalty is all but dead. A recent study conducted by Reach3 Insights found that nearly half of consumers have tried a new product or service since the beginning of the pandemic. Of these consumers, 85% intend to stick with their new choice(s).
In an episode of Outliers, our weekly live event series featuring market research experts and thought leaders, I spoke with Matt Kleinschmit, CEO & Founder of Reach3 Insights, and Ben Hudson, Senior Director of Marketing at Rival Technologies, about the quickly eroding nature of brand loyalty in the face of COVID-19. Throughout the conversation, we also touched on key lessons discussed in Matt’s newly released eBook, Keep Your New (COVID-era) Customers. Here, he explains what brands can do to drive consumer loyalty, and tap into the thoughts, opinions and behaviors that will encourage ultimately allow brands to keep their new customers.
Watch a recording of the event below or scroll further down for our key takeaways.
The pandemic highlighted just how fragile consumer loyalty is. A more useful way of thinking about loyalty is to think of it as a predisposition to buy from a certain brand.
37% of consumers were motivated to buy something new to shift things up… The loyalty that brands worked so hard to build isn’t as robust as it seems—it can change in an instant. This trickled down from buying a brand new $200,000 dollar boat to even trying a new dish soap.
In his book, How Brands Grow, Byron Sharp theorises that for people to purchase a good or service, they must have two things:
Matt reiterated during the session that both Mental Availability and Physical Availability need to exist at the time of a consumer’s need. During COVID-19, the importance of these elements was amplified. Therefore, the companies that were both top of mind and conveniently accessible quickly reigned supreme. Key examples of this were HelloFresh, Zoom, and SkillShare, which were all readily accessible online and fit evolving COVID-19 habits.
If market researchers want to attract new customers, they’ll need to ensure their products or services are mentally and physically available. To establish a strong brand connection, companies must remain culturally relevant. Examples of this include brand distinction, tag-lines, icons and influencer endorsements. In all cases, cultural relevance is closely tied to an emotional connection which will help keep your brand top of mind with consumers.
To establish physical availability, many brands will need to expand beyond traditional channels of distribution. When a consumer is looking for a new product or service, there will be multiple brands who will meet their criteria. The brands that are directly available will naturally attract and retain these new customers through convenience.
If consumer opinions and attitudes are changing, your brand needs to be the first to know. That means being constantly vigilant. Right now, people want choice, control, and flexibility. A relevant example is shopping options. In a recent study conducted by Reach3, we learned that 76% of the people we spoke with said COVID is impacting how they shop (this was even higher at 83% for Gen Zs). Some clear examples of this were taking more precautions when in-store shopping (68%) and shopping online more to avoid in-store trips (57%).
They’re not just new customers who have come along the same familiar path to purchase that you’re used to. They’re an entirely new customer segment, where you have to understand those hooks, those nuances, and how fragile that new relationship is. What works today might not work tomorrow.
Due to its rapidly evolving nature, insight leaders need to establish ongoing research programs that will enable them to understand their consumers. “As an insights leader, there are three aspects we’re trying to answer”, added Matt Kleinschmit. “If in one research touchpoint you can understand the behavior, the emotions, and the context of your consumers, you’re able to get a little closer to understanding why they made that decision.”
Another strategy to consider is investing in market research technologies that allow brands to engage with people in real time on the channels they’re already familiar with using. As consumer sentiments continue to change by the week, brands need to adopt agile research methodologies so that they can continuously engage their consumers in those key decision-making moments. The brands that can keep a pulse on these rapidly changing dynamics, and ultimately foresee long-term trends will build consumer relationships and earn their loyalty.
Many of the insights discussed in this Outliers session were gathered using the world’s best market research platform. If you’d like to learn more about how brands are keeping a finger on the pulse of the rapidly evolving attitudes, needs and expectations of its consumers check out the recording of our Outliers event below or download Reach3's eBook, Keeping Your (COVID-era) Customers.