Brand Loyalty in the New Normal Era: What You Should Do to Attract Loyalty Driven Consumers
COVID-19 has been the ‘topic of the day’ for the first half of 2020. Most brands have pivoted their marketing approach to be more in line with the pandemic. Brand loyalty is becoming more influential on a brand’s revenue. On Thursday 16 July 2020, the Doctor of Research in Management at BINUS BUSINESS SCHOOL invited Dr. Diena Dwidienawati, M.M. and Dr. Asnan Furinto, S.T., MBA as speakers in a Knowledge Updating Forum and Info Session titled ‘Brand Loyalty in the New Normal’.
Held via Zoom, the event was attended by practitioners, professionals, and academics. The two speakers, who have had many years of experience in marketing, shared their knowledge in building brand loyalty, especially in the new normal era.
COVID-19 Impacts on Consumer Behavior
The Coronavirus is not the first pandemic that Indonesia has faced. According to an IMF report that was presented by Mr. Asnan, there were significant differences between Indonesia’s economic growth during SARS, Ebola, and COVID-19.
While the rest of the world experienced a visible increase in their economic growth during SARS, Indonesia’s economy remained stable. There was no decline in Indonesia’s economic growth during Ebola either. However, both Indonesia and the international world have seen sharp declines in their economic growth as the COVID-19 outbreak began to spread in early 2020.
COVID-19 makes consumers more afraid of making purchases since they are unsure about the nation’s economic state and their own financial state. The public has started to make vertical shifts in their purchase intent, focusing only on their basic needs. More and more people have become more rational and practical when buying products, turning away from hedonistic behavior. Consumers begin a circular shift, forgoing their work-life balance and adapting their work-life integration.
Many believe that brand loyalty is just as important as attracting new customers. Unfortunately, there are only three loyalty-driven categories in the market. The consumers are more willing to be loyal to their chosen mobile carrier, auto insurance, and investments.
This means that the public has a specific consumer journey, which will affect their decision-making. There are four focal points in a consumer journey. The first one is the initial consideration set where the consumers start considering a set of brands. Secondly, brands enter and exit the active evaluation step. Thirdly, one brand is chosen during the moment of purchase. Last, but not least, the loyalty loop where consumers repurchase the current brand without looking for others.
Different Generations, Different Approaches
Ms. Diena revealed that there are four generations currently active in workforce: Gen Z, Millennials, Gen X, and Boomers. The younger generations are more familiar with digital technologies, making them more interested in online shopping rather than offline shopping. Specifically, the Gen Z and Millennials have low perception of loyalty as they have more access to other brands via the internet.
Gen Z who have lived most of their lives with the internet are more risk-averse than the older generations. They are more cautious and have modest demands, making them pure consumers who are more focused on personalized consumption. Older generations get emotional gain by buying various products, whereas Gen Z can attain the same emotional gain from their smartphones.
Empathy is the New Marketing Tool
The pandemic limits people’s activities to go out and forces them to be more digitally conscious. This is a proper marketing medium for brands to engage with existing customers and attract new customers. Moreover, there is no better time to increase your brand loyalty than now. People are more interested to buy the brands that they can relate to, brands that have great stories, and brands that care about their customers.
The younger generations like Gen Z and Millennials are proven to be more aware of environmental issues. More than 50% of them are actively reducing the use of plastic waste and willing to purchase from brands that are more environmentally conscious. Narratives that are filled with empathy are the new marketing tools to invoke brand loyalty during the new normal. ** (Erin-pid)
Unsplash, https://unsplash.com/photos/xwrTgGvLwdE, @rebapocket