New research commissioned by Emarsys shows a high level of brand disloyalty among Australian consumers.
The ‘Loyalty Index’ study shows that 65% of Australians will typically switch products for a cheaper price.
Having a wide range of products (60%) was the most common reason among all consumers surveyed for maintaining loyalty to a brand, with consistently low prices (51%) and regular discounts, loyalty points, and incentives following close behind.
Emarsys managing director, APAC Adam Ioakim said, “For these consumers driven by incentisivation, it’s important to reward them for behaviours and transactions – and keep them engaged in between purchases.
“Knowing who they are and ensuring that the channels they use are consistent and personalised for them as individuals is the core to what we have found drives true loyalty.”
Emotional and ethical factors lagged significantly behind incentivisation but still featured in a notable portion of responses.
Just over one in five (21%) of consumers listed strong social and ethical values as a top reason for brand loyalty, while having an emotional connection with a brand was cited in 23% of responses.
“By encouraging positive consumer behaviour through communication in between purchases, this will create a solid brand-customer relationship that can lead to a loyal customer base,” Ioakim said.
Emotional connection rose to one third of responses within the 16 to 24 age group while it was only seen 15% of the time in those aged 45 to 54, indicating that this factor may continue to gain importance as the younger generation ages and becomes a larger portion of the consumer base.
More than one quarter of respondents revealed they buy regularly from a brand despite disagreeing with their ethics.
This phenomenon was dubbed ‘silent loyalty’ by Emarsys and represents consumers who have loyalty to a brand but without advocacy.
‘Silent loyalty’ was one of five types of loyalty identified by Emarsys along with ‘incentivised’, ‘inherited’, ‘ethical’, and ‘true loyalty’.
‘Incentivised loyalty’ is won through discounts, offers, incentives, and rewards while ‘inherited loyalty’ is built through associations with other brands.
‘Ethical Loyalty’ is based on emotion, ethics, and strong consumer values, while ‘true loyalty’ is built through brand love and is the most unshakeable form of loyalty.
“Regardless of where they shop, whether online, in-store via mobile app, or over the phone, a consumer sees value in that brand beyond the transaction.
“True loyalty for a consumer is how that brand engages with them outside of a purchase and rewards them with something that is relevant and of value to them whether or not they are looking to buy,” Ioakim said.
In constructing the ‘Loyalty Index’ Emarsys surveyed 7,000 consumers in five countries, including around 1,000 Australians.