Report: Australian consumers aren’t loyal to brands

New research reveals brand loyalty eroded by price sensitivity

Australian consumers don’t care about brand loyalty when shopping, and price is the main factor driving it, according to a new local marketing report.  

Salmat’s 2018 Marketing Report compares consumers’ shopping habits with the perceptions and practices of marketers. It found customer loyalty continues to be a challenge for marketers in Australia, and to maintain brand loyalty, marketers must focus on value and quality.

The report reveals nearly one-fifth of Australians are loyal to only one or two specific brands and two in five consumers buy the products they need without taking much notice of the brand.

The findings show consumers are increasingly price sensitive, meaning price is a bigger influencer of purchase decisions than brand loyalty. Sixty five per cent of respondents agreed they like to try new products if they're on sale, or if they receive a discount or points for purchasing.

Following competitive pricing, consumers said quality of the products (80 per cent) and customer service (76 per cent) are the the most important brand attributes to maintain loyalty.  Positive online reviews (61 per cent) and free trials, samples and discounts (48 per cent) were also rated as important factors for maintaining brand loyalty.

“Winning customer loyalty is almost impossible to do today. Instead, the opportunity for marketers is to focus on ensuring they are getting the best price for their products in front of consumers via the right channel,” according to Salmat head of sales and client engagement, Andrew Lane.

“This could be through an integrated approach using  print, letterbox and digital - depending on the consumer’s preference. Marketers are under a lot of pressure to increase brand loyalty and the recent research shows that if brands can remain competitive on pricing, and communicate that to consumers through the right cost effective means like catalogues, search and email, they have a higher chance of increasing sales.”

What's also stopping marketers from delivering on brand loyalty are technology challenges.

According to the report, 86 per cent of marketers agree technological advancements help collect better customer insights and customer analytics, but 68 per cent of marketers found it challenging to use the same technology to help create lasting one-on-one relationships with customers  

Additionally, consumers demand personalised shopping experiences. Consumers reported they expect marketers to use the information they have on them to offer a more personalised and one-to-one experience.

Half of respondents agreed the number one reason brands are collecting their personal information is to deliver relevant offers (51 per cent). However, marketers are struggling to deliver on this promise and develop long-term relationships with consumers.

“When it comes to technology, marketers should focus on using the right tools to understand the vast amounts of data they are faced with,” Lane said.

“By understanding the data, they will be able to use it in the most effective way to reach consumers on the channel they want to be reached on, at the time of day they are most receptive, and with the products most relevant to them. It is these personalised experiences that will help drive loyalty considerably amongst customers.”

And while marketers are trying different tactics to encourage brand loyalty, Salmat’s research finds there’s a disconnect between what marketers are doing and what consumers find important.

According to the research, marketers said they are focusing on creating loyalty through quality customer service (47 per cent), offering trust, respect and promise (45 per cent), and developing quality products (40 per cent). But the research shows that first and foremost, consumers look for good value for money and competitive pricing (85 per cent) before anything else.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+:google.com/+CmoAu


Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Using artificial intelligence to surprise your customers

​We have expected artificial intelligence (AI) will become part of our everyday lives for quite some time.

Katja Forbes

Founder and chief, sfyte

Is customer segmentation dead?

Ginni Rometty, the CEO of IBM, announced the death of customer segmentation five years ago saying, "The shift is to go from the segment to the individual. She might have been a bit premature for most marketers, but if customer segmentation isn't dead yet, it's definitely on life support.

Richard Taylor

Senior digital strategist, Spinach

How people buy brands

Andrew Ehrenberg was a giant in the field of marketing science. He believed scientific methods could reveal law-like patterns of how people buy. In this post, I summarise one of Ehrenberg’s most important discoveries and its implications on how people buy brands.

Kyle Ross

Strategist, TRP

If a business games me happy than there is a higher chance I will go to them.

Martinez

The Iconic: becoming customer-focussed transformed our business

Read more

That’s a great example of surprising AR ad that went viral because it was first of its kind. Probably a similar effect to some scale can ...

Natasha Kvitka

Using artificial intelligence to surprise your customers

Read more

Hey there! it is a really meaningful post. I too have written a few similar articles about SEM, SEO, Social Media, Digital Marketing Tren...

Rohit

Digital advertising continues to dominate marketing budgets

Read more

Thanks for sharing the strategies ! :)

Isabella Richardson

Marketing the most of martech for revenue and CX

Read more

Glad to be a part of this informative post... Thanks for sharing this useful info!!! It is very important to stay updated about the lates...

Aaron Alexis

Predictions: 9 digital marketing trends for 2019

Read more

Latest Podcast

More podcasts

Sign in