Brand Loyalty Is Sinking, Can Mobile And The Likes Of Foursquare Be A Savior?

A new report published recently by comScore indicates a steep decline in consumer brand-loyalty over the past two years, leading the way for emerging concepts such as mobile marketing and mobile social concepts like that of Foursquare to pick up the slack.

The comScore study evaluated the change in brand loyalty within a number of consumer goods categories, including health & beauty aids, OTC medications, apparel, food, household products and housewares. As the economic downturn has continued, the percentage of shoppers who typically buy the brands they want most has steadily declined across the categories examined.  In March 2010, for example, less than 50 percent of shoppers reported purchasing the brand they want most.

For most categories, the drop in likelihood to shop for the brand wanted most is not restricted to buying other brands on sale.  Rather, a sizeable percentage of the change in shopping approach is being driven by a decision to convert to less expensive brands to save money.

“A decline in loyalty to consumer goods brands is typically one of the byproducts of a recession as consumers give greater consideration to price,” said Mr. Fulgoni, comScore’s chairman. “Research we’ve conducted at comScore ARS has quantified the impact of the ‘trading down’ effect within a number of different product categories, highlighting consumers’ increasing willingness to switch brands in the face of pocketbook constraints.”

Though the decline in brand loyalty is undoubtedly effected by cost-savings from a consumer perspective, it also has to do with the brands themselves.  Adopting new methods to engage customers and keep a brand relevant should be a top priority for businesses — especially those engaged in consumer goods — and the time couldn’t be better.

Utilizing mobile concepts to engage an audience on new levels and insert a brand image in contextually relevant and highly targeted content can do wonders for a brand that’s quickly seeing a loss in customer loyalty.

Social media, and especially location-based social media marketing is another tool that’s highly under-utilized by brands still.  The ecosystem slowly growing around services like Foursquare, Gowalla and others is creating a truly unique opportunity for brands to engage their audience on completely new levels and through concepts that consumers enjoy the most.

Though the use of direct branding through traditional channels was once sufficient in maintaining brand and customer loyalty, the landscape is perpetually shifting.  As comScore’s survey results suggest, consumers are shifting the way they see their favorite brands, and loyalty is decreasing by a sizable rate.  Utilizing in-direct branding through mobile and social media marketing can be a savior for brands if used properly, it’ll just involve thinking outside the box.