Report: Brand Loyalty Declines as Consumers Push for Transparency

Following two tumultuous years, consumers are returning to their pre-pandemic ways. Spending on experiences and activities is up, and shoppers are returning to stores in person. Consumers are looking for the best selection and the best prices. What they’re not concerned with is brand loyalty.

Where has the love gone?

According to a new Brand Authenticity Report from Sitecore, just one-third of U.S. consumers describe themselves as “very loyal” to their favorite brands. Two-thirds (66%) say they have stopped shopping with a brand following a poor experience, and nine-in-10 (91%) say they expect brands to be transparent about communicating the reasoning behind price hikes and supply chain issues.

“While we’ve known that brand loyalty dynamics have changed, it is still surprising to see just how quickly shoppers are willing to leave brands that they were once loyal to. Their readiness to stop shopping with a brand after just one poor experience shows how high customer expectations are in the post-pandemic world,” says Sitecore Chief Marketing Officer Paige O’Neill.

With endless options for brands and marketplaces to shop from, both online and offline, shoppers in 2022 have become fickle. O’Neill says consumers are basing each individual purchase on their specific criteria: looking for the best products, best prices, and best shopping experience.

Data from Sitecore’s survey of more than 1,100 U.S. consumers backs up O’Neill’s assertions. Seventy percent of consumers say they want “deeper, more personal connections” with brands, and 82% say they’re more loyal to brands with customer service agents who “ditch the script” and have the autonomy to effectively resolve their unique issues. Eighty-six percent say showing empathy and understanding of what they need in the moment is “powerful” in building a stronger relationship with a brand.

“While loyalty seems to be dying, it’s not yet dead. Brands must understand the power of personalization to win customers back, and this starts with taking the time to understand who their customers are at their core,” O’Neill says. “A one-size-fits-all approach will not work in 2022, and brands must adapt their strategy to meet each customer where they are shopping with the experience they crave.”

In addition to knowing their customers, brands should have their own identity and promote what it is that they stand for. O’Neill says Sitecore’s data overwhelmingly shows that customers want stores to be inclusive and reflect the diverse world around us. Shoppers also want to purchase from brands that have similar values to their own. If brands fail to effectively communicate their values and create an experience that makes them clear, shoppers will have no problem choosing a different retailer.

“Customer service issues play a huge role in the brand loyalty issues we are seeing today. Just one poor experience can push a shopper away for life – signaling the massive risks of not creating a supportive CX,” O’Neill says. “To prevent this, brands need to make it as easy as possible to shop with them. By creating an intuitive shopping experience across channels, brands can stop customer frustrations before they even happen.”

Using the Right Tools

When problems do arise, O’Neill believes it’s important that brands have the right tools and resources in place to support customers and resolve issues. 

“This is another area where personalization is so important. Brands must take steps to ensure that each customer support channel has the right information on the customer and situation to ensure they resolve any issues quickly and effectively.”

Unifying data is one way brands can alleviate the underlying issues identified in Sitecore’s report. Siloed data leads to departments drawing contrasting conclusions from different data sets, making it all but impossible for organizations to identify the discrepancies.

“Unified data can help personalize customer experiences, such as remembering past orders and inspiring shoppers with curated product recommendations or offering unique reward programs.” O’Neill says. “Brands are getting more sophisticated with how they use data to enhance CX and their overall operations, which is a crucial step toward rebuilding shopper loyalty.”

Stephanie Miles is a senior editor at Street Fight.