New research from Salesforce has revealed what it believes to be precarious customer loyalty for retailers.
Salesforce has released the fifth edition of its State of the Connected Customer Report, in partnership with the Australian Retailers Association (ARA), showing that 61 percent of customers have switched brands at least once in the past year.
The report surveyed 16,936 consumers and business buyers from 29 countries, including 654 from across A/NZ, and analyzes how and to what extent customer expectations and behavior have shifted during the global pandemic and the new digital-first landscape of customer engagement.
The survey found that 42 percent of customers have changed brands in the past year for better customer service, and 51 percent say they feel like sales, service, and marketing departments aren’t sharing information. It shows that brands are under pressure to connect online and offline customer interactions, with 79 percent of respondents being more loyal to companies that provide consistent interactions across an organization.
“The State of the Connected Customer Report shows that customers are reassessing established brand loyalty as their priorities and behavior shift,” said Jo Gaines, Area Vice President of Retail and Consumer Goods at Salesforce.
“At a time when it has never been easier for customers to switch brands and loyalty is elusive, retailers need to focus on creating great experiences, both digital and physical, and their customers’ recency and history with their brand. Appreciate.
“While now more than ever, customers have a distinctly digital-first mindset, they expect retailers to know, understand and give them a human, thoughtful, and personal touch, from personalized offers to recommendations based on their past purchases,” she says.
“The retailers who don’t create these experiences risk damaging hard-won relationships.”
Gaines says that as more shoppers seek fully connected in-person and offline experiences, retailers need to create moments and interactions that bring all elements of their brand together.
“It’s never been more important to gain, build, and maintain customer trust,” she says.
“We are now also in the consumer-conscious era, with shoppers increasingly shifting to more value-driven brands that address the issues that matter to them, such as climate change.
“While people want brands that are clear about their values and stand up for them, they don’t want to pay much more for them.”
Paul Zahra, CEO of the Australian Retailers Association, says customers are now more impatient than ever before.
“If they don’t have a positive experience when they enter your store or visit your website, they move very quickly and search for competing brands and products,” he says.
“This survey is an important reminder for businesses about the importance of knowing your customers, what products they like, the communication channels they prefer, and the best personalized offers.
“More and more Australians are buying the things they need with a few taps of their fingers, and people now expect the best shopping experiences to be delivered online and vice versa. Social media is also playing a bigger role as part of the integrated online shopping experience, meaning that investing in the digital and innovation space is incredibly important for companies if they want to stay relevant,” says Zahra.
“Consumers are becoming more values-driven and shopping with brands that reflect their social and environmental concerns, so issues like sustainability and climate action are becoming increasingly important for companies to strengthen their customer relationships,” he says.
“The climate change debate is over, and it’s not if, but how and when companies can achieve their sustainability goals.”
Key findings:
Brand trust is becoming increasingly important in times of change: As customers navigate a rapidly changing world, trust increasingly affects their relationships with companies. In A/NZ, 90% of customers believe that trust in businesses becomes more important in times of change, but 71% lose that trust when there are inconsistencies across multiple organizational touchpoints. In addition, 48% lose confidence when they receive communications from brands that don’t match their interests. Customers are adopting a digital-first mindset: Today’s customers are increasingly shifting their preferred experiences with brands to online channels. Over the next three years, customers expect to use more augmented reality (50%), video appointments (55%), virtual experiences (53%), and social media for shopping (50%). To meet their unique needs and preferences, 57% of customers say they are open to companies that use artificial intelligence to improve their experiences. The shift to digital is driving personalization at scale: brands are pressured to merge online and offline interactions into personalized experiences. 51% of customers are willing to share their personal information with a company in exchange for personalized offers or discounts, while 41% expect company offers to be personalized at all times. 48% say personalized rewards would increase their use of loyalty programs. Customers expect companies to demonstrate their values: Today’s customers increasingly expect companies to respond to and act in the best interests of society. If you don’t, you risk impacting profits, as 55% of respondents change brands because the values match theirs. 90% of customers are influenced to shop from a brand based on its environmental practices, its actions against economic injustice (86%), acts against racial injustice (83%), and community involvement (86%).
