Amazon feels love but overall brand loyalty takes a hit

amazonAmazon may be not have had the best media coverage of late, but in UK consumers’ eyes it can do no wrong, after being named once again as their standout favourite online retailer.
However, it is not just in retail that the company has a powerful base, as, according to the DMA’s latest ‘Customer Engagement 2018 Report, Amazon also features across several other sectors second among media or entertainment, and fourth for technology companies. This is despite being attacked by the Archbishop of Canterbury Justin Welby over its use of zero-hour contracts.
Even so, one in three (33%) consumers said they did not have a favourite brand or one they are most loyal to and nearly two-fifths of people in the UK (39%) feel less loyal to brands and companies than they did a year ago.
Conducted in partnership with Pure360 and Foresight Factory, the report shows that loyalty is changing and the challenge for businesses is understanding what their customers really want.
Customers claim that they feel less loyal, but this may not translate into a change in their behaviour and needs. Year-on-year the figures have remained steady with half of consumers (49%) still falling into the ‘Active Loyal’ group and around one in five (22%) as ‘Active Disloyal’ – with the remainder either loyal through habit or in certain situations.
When it comes to the top five favourite brands, consumers also report feeling genuine loyalty to those brands, rather than this simply being based on convenience or habit. This was particularly the case for John Lewis and Marks & Spencer, with 89% and 88% of consumers agreeing respectively. Interestingly, two-thirds (67%) of people who chose Amazon as their favourite brand are loyal to them for genuine reasons – rather than convenience alone.
DMA managing director Rachel Aldighieri said: “Brands must renew their focus on the most important part of their long-term success, their customers. Whether marketers decide to offer more personalised experiences, new loyalty schemes or flexible subscription models, successful brands will be those that can put the customer at the heart of everything they do.
“We feel like we’re less loyal, but this feeling is belied by our continued support for the brands we know and trust. It’s contradictory, of course, but moreover the issue of loyalty is an increasingly more complicated problem too. Consumers have more choice than ever before, but the key for brands is ensuring they are utilising the data and marketing channels at their disposal to build genuine long-term relationships with their customers.”
Read Group customer engagement director Scott Logie concluded: “In the post-GDPR era, building long-term trust and loyalty is more important than ever. By looking at loyalty trends across different years, we have seen how many consumers are actually more loyal than they believe they are at heart.”

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