Brand loyalty is a hot commodity today. With plenty of tools that make online shopping and purchasing extremely easy, the path to purchase is no longer linear, but rather, an irregular journey with brands entering and exiting consideration sets up to the point of purchase.
Car brand loyalty, in particular, has seen its share of decline as price and quality bands have narrowed, and as make/model/trim combinations have skyrocketed. Generally speaking, there aren't bad cars on the market anymore, nor are there bad deals, which makes breaking through the clutter to win a customer's business all the more challenging. The car shopping experience is changing and marketers need to heed the trends.
McKinsey & Company conducted a study about brand loyalty. We think the results are interesting and we wanted to share them with you. Here are the highlights.
In the study of the more than 125,000 consumers shopping for more than 350 brands in 30 product categories, only 3 categories - Mobile Carriers, Auto Insurance, and Investments - were loyalty driven. The remaining categories, including automotive, were shopping driven. In fact, the automotive category sat near the bottom of the study with 90% of consumers driven by shopping in this category, and only 10% driven by loyalty.
The study suggests that marketing professionals need to make an impact on consumers when they are initially considering which brands and products to purchase, recommending "they'll need a fine-tuned understanding of who those increasingly fickle consumers are, what triggers them to shop, and how best to enter what's known as the initial consideration set."
In the shoppers group, a meager 13% purchased the brand they originally intended (considered "loyalists") with a full 87% continuing to shop around. Of the 87% of shoppers, 29% ultimately didn't change brands but 58%, on the other hand, were enticed away. Surprisingly, the brands that were included in the initial consideration set were twice as likely to be purchased as those that were not, indicating the importance of marketers winning consumers over much earlier in their journey to purchase.
With social media influences, the availability of online tools and information, and peer recommendations, the car shopping experience has been transformed from one of loyalty to one of experimentation. Therefore, it's important for marketers to beef up their budgets to build brand awareness, brand value propositions, and initiatives that promote product testing (particularly for newbies).
Need conversion tools for your website to turn shoppers into buyers? AutoWeb can help.
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