Amid rising prices due to inflation, consumers are having to make difficult choices on where to spend their hard-earned money. By monitoring and benchmarking key trends in consumer behaviors, we’re able to see patterns and develop strategies for our clients to maintain and increase customer loyalty when market conditions are uncertain.
Three Trends to Watch
- Deal Seeking – consumers are more inclined to sign up and use loyalty program discounts and benefits to seek value. A recent survey found that 8 out of 10 Americans are members of at least 1 loyalty program and half see those programs as more important due to rising costs.
- Compromising – to counter higher costs, consumers are trading down by choosing a store brand, cheaper substitute or postponing or foregoing purchases altogether.
- Self Reliance – post-pandemic, and with the market uncertainty, consumers are taking more on themselves to stretch budgets further like DIY projects, cooking at home, etc.
Loyalty and the Consumer Experience (CX) Connection
Consumer loyalty does not always correlate with spending trends, but brands most affected by inflation and supply chain issues are experiencing a waning in consumer loyalty. Research from one of our insight partners, Resonate, shows that 76.4M Americans (18 and older) are 62% more likely to buy cheaper brands, 50% more likely to change brands because of price increases, and 31% more likely to have switched brands in the last 12 months.
Brands are investing in integrated loyalty offerings to help win customers back and retain those that might be on the verge of shopping around for the best deal.
- Airlines are offering subscriptions with perks like priority boarding, guaranteed overhead bin space, and drink vouchers.
- Restaurants are creating or enhancing loyalty programs to offer customers more valuable incentives and introducing subscription models to entice repeat visits like Taco Bell’s Taco Lovers Pass and Panera’s Unlimited Sip Club.
- Retail is also seeing an increase in subscription services for consumables, clothes, and every day re-order items like vitamins or pet food.
Poor CX due to cancellations, lack of staff, lack of product, and sub-par communications can further degrade the consumer’s loyalty to a brand. Consumer expectations continue to increase and push brands to rise to the challenge. Consumers expect excellence in service that offsets the uncertainty of the current economy. Brands who prioritize and invest in CX now can not only rebound faster, but they can create seamless customer experiences that engage and drive demand in the short term.
Interested in Assessing Your CX Readiness?
Ansira has developed an online assessment that can help brands gain key insights into your company’s overall readiness across the CX landscape. Uncover the biggest gaps and where to prioritize efforts across critical CX capabilities to meet the needs of your customers. Evaluate your readiness and see where your brand strategy stands by taking the assessment today.
Ansira can help develop solutions to elevate the consumer experience with the brand, such as expanding your direct-to-consumer communication channels, designing new digital experiences to better serve your consumers, or creating a clear and mutual value exchange through integrated loyalty programs.