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The Effects of the Pandemic on Customer-Brand Interactions
By Communicate StaffWed, Jan 20 2021

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YouGov MENA conducted an exclusive research for Communicate, to understand how brand loyalty has been impacted during the course of 2020. Communicate discusses the findings with Zafar Shah.

the-effects-of-the-pandemic-on-customer-brand-interactions

Market research firm YouGov conducted an Adhoc online research in UAE, amongst 500 respondents using their new audience segmentation tool, YouGov Profiles to discover if the pandemic impacted brand loyalty. Based on the responses, the research team segmented their audience group based on who remained loyal to their preferred brands versus those with diminished loyalty.

Loyalists are those whose brand loyalty remains the same even now while the diminished loyalty group consists of people who have lost loyalty towards certain or all of their previously preferred brands. Communicate discusses the findings in detail with Zafar Shah, Research Director, Data Services MENA, YouGov MENA.

How has the relationship between the consumer and brands been affected as a result of the pandemic?

Prior to COVID-19, consumers gave the utmost importance towards brand (71%) followed by quality and price. But since the onset of the pandemic last year, consumers began shifting their importance towards price (70%) and value for money (68%). Since last year, the shopping habits of consumers have drastically changed. 50% of respondents stated that they now shop based on necessity, rather than just spending impulsively. As a result, brand loyalty has also dropped among consumers. A quarter of respondents (26%) have begun exploring alternate options based on price and availability.

Using our Profiles tool, we discovered that the diminished loyalty group is now significantly more likely than loyalists to shop based on necessity and also explore other brands compared to their usual ones. In the past, price was not an important parameter for this group but now, price has jumped to the top of the list of parameters that influence their purchases.

What are some of the changes in the consumers' expectation from brands today?

While it's a given that brands should continue maintaning high standards of hygiene and sanitization, 51% of respondents are also expecting brands to offer fast and free home delivery as well as provide more offers and discounts on products. This point was considered to be especially important among the diminished loyalty group. Consumers are also expecting their preferred brands to adapt quickly to changing circumstances (42%) and create an online presence (41%).

Have brands lost loyalty from consumers this past year? If so, how can they rebuild it?

Our study recorded that while 30% of respondents stated that they continue to be loyal to all of their preferred brands as before, 58% have shown a shift in brand loyalty. As mentioned earlier, more importance is now being given to price (70%) and value for money (68%). Brand has dropped to the bottom of the list with only 33% considering it to be important (as opposed to the 71% pre-COVID). Among the diminished loyalty group, these respondents were significantly more likely to disagree with the statement "I prefer a meaningful connection with brands over a short term connection that will fade away" than loyalists. Hence, reiterating the fact that brand value is of low importance to this group.

Hygiene factors like purchase experience, quality, price, recommendations and customer service must continue to be dependable as they are observed to have a direct effect on brand loyalty. Customers now seem to be more affected by how much the brands contribute to the society and the company’s overall image. They also do not trust products recommended by celebrities / influencers – something to consider while targeting them in their communications.

While demographically, there weren’t many striking differences between the two segments, a key point that we uncovered for the diminished loyalty group was that their household financial situation seems to have become significantly worse as the months progressed, in comparison to loyalists. Apart from being financially very cautious, they also tend to be significantly more confused with financial matters than the loyalists and feel that they will never be able to save for a rainy day. This does explain to an extent why the group gives more importance towards price and have slowly moved away from brand.

According to the research, how should brands approach purpose driven marketing? What are some of the tenets to keep in mind?

From the previous MEPRA study that we had conducted in November/December of 2020, we found that certain motivational factors emerged as being important to customers. Respondents really care about how well their [preferred] brand aligns with their own personal values, the brand’s overall persona, their contributions to society and how well their own employees promote the brand. Customers are observed to spend more when they get a great ROI on their purchases but now they also find it important that their personal values are in alignment with the brand values. The underlying need here is that people want to spend more with a brand that is positively impacting society.

Customers now want their preferred brands to use their position to speak their minds, since they're able to reach out to the mass public, set examples and make contributions to the society.  While brands should speak more about their products, services and their overall business performance, customers also want to now know more about the social initiatives that their brands undertake, events they sponsor and their stand on different social issues.

RELATED TOPICS
Yougov Consumer Loyalty Zafar Shah Brand loyalty Mena Uae
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