Loyalty Programs, Customer Retention, Consumer Psychology
Often when you hear brands concerned with consumer loyalty, it’s usually due to an overwhelming interest in how unwavering support is cultivated. But what about the factors that contribute to a decline in loyalty?
We’ve written a list of five issues that challenge consumers’ ability to be loyal during the consumer journey.
1. Rising prices
Some issues only rear their ugly heads every once and a while, but when they do, consumers certainly take notice.
With the recent rise in inflation, brands have had to raise their prices in order to stay competitive. Consumers, who’ve had to spend more money as a result, haven’t been very welcoming of the change. In fact, the rising prices have had a direct impact on consumer loyalty. While some consumers have cut back on discretionary spending and taken a few things out of their baskets, others have chosen to outsource in hopes of fulfilling their needs.
The desire to spend less money isn’t just a matter of consumers wanting to manage their finances — it’s also a psychological affair. When consumers part ways with the money in their wallets, they view it as a loss and one that impacts them emotionally. And as one might expect, any negative feelings associated with brands don't do much to benefit consumer loyalty.
2. Consumer inundation
Having open lines of communication with consumers can certainly help in building consumer loyalty, but too many marketing messages can alter the relationship between consumers and their favorite brand.
Consumer inundation is the repetition of constant contact between consumers and brands that becomes overwhelming for consumers. Such communication can have a number of negative psychological effects on consumers, including annoyance. Those feelings can lead consumers to unsubscribe from an email or text list and decide to interact with another brand.
3. Consumer empowerment
Consumers aren’t struggling to find brands that will serve their needs. If anything, brands are interested in finding consumers who want to shop with them — and consumers know they’re the ones who are high in demand.
When consumers have multiple options to choose from — especially if those other brands offer quality products for equal or lesser value — there isn’t much keeping them committed to one company. Consumers have a lot of confidence, and it’s turned into consumer empowerment.
Having a lot of options can lead consumers to feel like allegiance to a certain brand isn’t necessary, since there are others available that are just as capable of fulfilling their needs.
4. Lack of trust
At the core of any strong consumer relationship is trust. It’s what gets consumers to purchase a product and turns them into returning customers.
Loyalty and consumer retention are built on trust. When consumers know a brand is reliable, offers quality products and will correct any issues that occur, they’re much more inclined to become loyal customers.
5. Absence of focus on personal values
Consumers are no longer loyal to a brand strictly based on its ability to meet their needs — the brand must also appeal to consumers’ values.
Ethical consumerism is the process of consumers supporting businesses based on their relationship to a few key pillars: human rights, the environment, animal protection, community involvement and social justice. It’s the latest trend determining what brands consumers decide to interact with.
A 2022 survey by Harris Poll discovered that 82 percent of consumers want to shop with brands that have similar values. If a brand doesn’t share their values, consumers aren’t afraid to go elsewhere. (Generation Zers have been known to walk away from brands if they don’t match their beliefs.)
Loyalty isn’t set in stone. Consumer feelings toward a brand can always change, and some things accelerate the onset of negative emotions. Brands should do what they can to avoid touching on any of these factors and adamantly work to support customer needs.
