Invest in your customers and reap the benefits - Business Works
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Invest in your customers and reap the benefits

Phil Singh, VP EMEA for Business Development, Epsilon The UK results of the Epsilon 2013 Consumer Loyalty Study have just been released in the report, Invest in Your Customers, and the UK Could be The Jewel in Your Retail Crown. The study revealed that only about a fifth of Britons (22%) feel strongly about their own or their familyís financial prospects and over three quarters of the countryís consumers are experiencing low savings rates.

The repercussions from the financial crisis in 2008 are still reverberating around the country as austerity measures continue and the government struggles to navigate the country away from a triple-dip recession. The British high street has undergone significant changes in the past five years as a result of the economic woes, with several iconic brands exiting the market altogether. This isnít helped by the fact that UK consumers are currently extremely cautious with their disposable income, with more than half (57%) choosing to shop around for the best bargains and just 15% willing to spend extra to purchase luxury branded items.

"The backdrop of uncertainty has provided many challenges for brands," says Phil Singh, Vice President, Business Development for EMEA at Epsilon. "The push to try and create loyal customers has left many brands scratching their heads after spending significant amounts of time and money on loyalty programmes with little or no return on investment. Consumers are seeing the advantages through discount cards, price reductions and coupons but thereís minimal, if any, gain for brands because customers do not necessarily remain loyal."

"Loyalty appears then to be the new frontline of competition in retailing. If brands can offer what consumers want ó which half of respondents identified as being value and quality in the products or services they are offered ó they have a good chance of encouraging customers to remain loyal."

The study reveals that the most loyal consumers can be found in the mid-income bracket, twice as many as high-income earners in all sectors except travel. Ten per cent of the mid-income clothing shoppers gave the highest loyalty score compared to three per cent for higher earners. Similarly, in the grocery and financial services sectors, only a respective 15% and 14% of respondents in the mid-income level considered themselves exceptionally loyal versus only eight and four per cent of high income consumers respectively.

Meanwhile, the high income group is found more self-reliant than the other income groups in gathering information that half of them (50%) trust the information on review websites to make their purchase decisions, whereas only 36% of the mid-income and 31% of low income consumers will rely on that channel. "A consideration for retailers should be to utilise the positive public and social ratings of their product or service to create differentiation. Itís worth trying to add the key rating on the message or e-commerce site and develop a retail offer for top ranking products and promote across touch points to improve click and purchase outcomes, or at least test for it," says Phil.

"In this complicated, crowded market, brands cannot afford to be anything but approachable, informative and targeted in both their marketing and communications. Get it right and there is an enormous opportunity in the UK; get it wrong and brands risk losing everything."

For more recommendations on helping improve customer loyalty and other findings from the study, download the full UK report from:

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