Is the Coronavirus Hurting Brand Loyalty?

Over the past few months, the coronavirus pandemic has not only changed shopping habits (think: spending on household goods over nonessential items), but also reshaped consumers’ perception of brands.

According to a new study by Braze, shoppers today have been quick to replace the brands they’ve long known and patronized with those that better align with their values: In a survey of roughly 8,000 people around the world, the consumer engagement platform found that only 10% of respondents ranked “familiarity” as a top consideration when deciding where to make purchases. This came in contrast with 91% who said that a company’s response to the outbreak — specifically toward employees and customers — was an important criterion.

“COVID-19 has changed the consumer retail experience forever,” president and chief customer officer Myles Kleeger said in a statement. “As demand for e-commerce looks to become permanent, customer loyalty has been upended and spending patterns have changed.”

Researchers for Braze discovered that 89% of shoppers in the United States were most likely to switch from a brand due to their response to the pandemic, compared with 86% in the Europe, Middle East and Africa region and 94% in Asia-Pacific countries.

What’s more, roughly a quarter (or 26%) of global consumers tried at least one new brand during the course of the COVID-19 health crisis — and a whopping 95% said that they intended to buy from one of these new brands again in the future. Among the pool of respondents, 47% reported that stores’ current safety policies will inform their decision to shop with that particular retailer.

As the coronavirus outbreak continues to drag on, the study’s authors suggested that consumers increasingly want to use their purchasing power to reward brands that demonstrate corporate empathy. It added that the mistreatment of employees, environmental harm, opposing political stances and not taking a stand on certain issues were among the reasons consumers have opted to drop their patronage of a brand.

“To effectively serve customers and drive future growth, prioritizing customer engagement is more important now than ever,” Kleeger explained. “Brands that double down on digital and place personalization at the heart of their strategy will emerge from the pandemic stronger than before.”

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