New Ernst & Young survey shows that ‘chameleon consumers’ fail to connect with brands on Facebook.

Brand loyalty is well and truly on the wane in mature markets according to a new survey from Ernst & Young, with just 25 per cent of US consumers calling themselves brand loyal compared to a global average of 40 per cent. The consultancy firm ascribes this partly to the rise of social media which has led to the creation of a generation of ‘chameleon consumers.’

Despite this companies are largely failing to engage social media users, according to the survey. Brands’ use of social media fared particularly poorly: 85 per cent of social media users believe companies don’t optimise social media to communicate with consumers. Technology has changed consumers’ expectations of service levels, as well as how, when and where they consume, the survey found, with 62 per cent of consumers venturing online for at least part of their shopping journey.

“In recent years, customer behavior has changed beyond recognition,” says Richard Ingleton, advisory partner at Ernst & Young. “The consumer has undergone a radical metamorphosis and this change has significant consequences for all customer-reliant organisations. Consumers are equipped with all possible product, price and stock information, and can simply bypass retailers that don’t compete.” The surveys calls these ‘co-creating consumers.’ Quality and price are seen as the two main drivers of brand loyalty.

The report says that “customer experience is the new brand” and that the telecoms market enjoys the most brand loyalty while financial services comes last.

“In today’s retail setting, very little is fixed and many things are fluid – whether it’s behaviour or brand loyalties, trusted media or shopping habits, market segments or the role of physical stores,” the report concludes. “Understanding the implications of these trends and developing solid principles of effective marketing will help organisations navigate through this new consumer environment.”

None of this is very surprising, except perhaps for the low brand loyalty score in the US where consumers receive more marketing messages than anywhere. But as many of these, from retailers particularly, are designed to woo hitherto loyal customers away from their usual choices maybe this isn’t very surprising either.

The findings also beg the question: is it actually worth chasing ‘chameleon consumers’ via social media? most companies may be failing to connect with such consumers this way but it’s hardly for want of trying, with marketing spending on Facebook, for example, going through the roof. Maybe Facebook users just aren’t interested in brands? Twitter users certainly don’t seem to be.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.
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