Engaging Brand Enthusiasts Is Key To Snagging Customers

Forget loyalty, think enthusiasm. In a world where good product quality is table stakes, brand touchpoints are ubiquitous, and transparency is critical because of our omni-channel environment? The 2014 IBM Consumer Products Study finds that loyalty actually isn't relevant if it isn't interpreted correctly. And loyalty exists, but it doesn't supplant a willingness to shop competitive brands. And it isn't necessarily associated with repeat purchasing. In fact, the key is enthusiasm. 

The study —  based on an IBM Institute for Business Value survey of 18,462 consumers in 12 countries on six continents across age brackets and income — identifies four primary consumer groups with different degrees of enthusiasm for a brand. The most loyal — brand enthusiasts, who are 25% of the sample group — had a high propensity for recognition and two-way engagement. Ambivalents, among whom 36% are positive about brands, are reluctant to engage. Product purists may want to be recognized by brands but aren’t engaged. 



The latter group prefers locally made products. Finally, disassociated shoppers  about 14% of the cohort — are highly price sensitive and aren't likely to be engaged with brands. 

The study shows that a critical group, and most likely to be brand enthusiasts, are Millennials — constituting 51% and 41% of enthusiasts and ambivalents, respectively. And the enthusiasts and ambivalents are highly represented in the global growth markets China, India, Brazil, Mexico Russia, South Africa. 

The study says enthusiasts are more willing than any other group to pay for products with premium features, and comprise 47% of the high-income and affluent population in the global growth markets. But the ambivalents are by far the biggest portion of the sample size, and are represented evenly in growth and traditional markets like the U.S. and Europe. They are the bulk of purchasing power, with 34% of total disposable income.

And the largest block of Millennials fall into this group (41%, compared to 35% who are brand enthusiasts, 15% of Millennials who are product purists and 9% who are disassociated shoppers.) Thus, says the study, Millennials "have yet to formulate an opinion about the role they want brands to play in their lives. They crave selective engagement and are waiting for brands to make the first move." They are, however, willing to pay for products with greater health benefits, socially responsible practices and brands that offer full transparency into how products were sourced and made. 

Brand enthusiasts are ahead of other consumers both in technology and in defining brand engagement, per the study, which finds that 72% have Internet access via phone, versus 57% of ambivalents and 35% of purists. Over half said they look up product information on their phones when in stores, and over half post comments on the Web sites and social pages of brands they are enthusiastic about. Over three-quarters said they want to submit ideas and feedback on innovation. They are also five times more comfortable sharing personal information, including location-based data, than the other three groups. 

All of the groups said that in the next two years they will dramatically increase the use of alternate distribution like buying online and sin-store pickup and automatic replenishment. Thus, mobile-first is table stakes for any consumer-facing company. One of the study's key recommendation is to capture the valuable chess piece: the brand enthusiasts. "Companies need to continuously stimulate this population through a strong combination of reach and engagement strategies. Take advantage of their openness and willingness to share data by experimenting with new systems of engagement."

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