Five ways to navigate the loyalty crisis among Australian brands

14 April 2021 Consultancy.com.au 4 min. read
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Consumers in Australia are reluctant commit to a single brand, and rarely sign up to loyalty programmes – mainly owing to disappointing experiences. A new R/GA study highlights five high-impact focus areas to navigate the country’s “loyalty crisis.” 

R/GA ran surveys with around 16,000 consumers worldwide – with the Australian sample concentrated in the automotive, banking, insurance, retail, superannuation, telecom and utilities service areas. As it happens, brands in Australia just aren’t making the cut for customer retention. 

“Of all the purchases people made in Australia, 60% were unsure if they would make the same choice if they had to do it over again,” explained Michael Titshall, vice president and managing director at R/GA Australia.

R/GA’s Australia CX report

And this is despite the notion of digitalised and personalised customer journeys taking hold through the business environment. Many factors are at play in this disconnect – crystalised by the design and innovation consultancy into five key areas of improvement. 

Cutting the hype

One is a widespread sense of disappointment. More than half of Australians have found a disconnect between the promise of a product or service and reality. Over 50% also report that their first experience with a brand isn’t entirely positive. 

For Titshall and his team of experts, this boils down to overselling – where brands set high expectations and fail to meet them repeatedly. “This hype job is a double-edged sword. When the expectation doesn’t match the experience, the likelihood of repurchase plummets.”

The key lies in tying up the initial steps of the customer journey nicely. “Just like in any new relationship, the first few moments together can make or break. Set expectations from the start, and deliver on them repeatedly.” 

A long-term view

The second theme also relates to the “precious post-purchase moment,” where customers seek support and information on getting the most out of their product, and are most open to building a long-term relationship.

Per the survey, nearly 80% of Australians don’t just enjoy a seamless experience – they expect it. Far from considering the job done once a purchase is made, brands need to build “a long-term, customer-centric strategy that uses brand values to inspire, data to decide and people to engage.” 

A personal relationship

Brands have realised the value of data for personalisation – although their execution tends to be aggressive, even creepy at times. Around 85% of consumers do want curated recommendations from a brand, although the main clincher for them is a personalised post-purchase experience. 

Nearly three-quarters of Australians are interested in a one-on-one concierge service after a purchase – to build a personal relationship with the brand and have their questions answered. For R/GA, this eagerness to connect can be leveraged to gain deeper insights into customer preferences – via an easy and useful data sharing platform – to deliver products that “work for customers, not just ‘someone like them’.” 

Loyalty not frequency

Loyalty programmes in Australia tend to chase purchase frequency, and are considered successful if a customer returns multiple times. Consumers notice this, which is why 85% of Australians think loyalty programmes are important, but only 12% have actually signed up for one. 

Per the researchers, loyalty is a much deeper emotional bond – where consumers will buy from a brand no matter what they produce, owing to a connection with its value and service. With droves of customer data at hand, brands should be creating a sense of community, connecting with consumers at a personal level, and “creating a habit” rather than a series of disjointed purchases.

Crafting a community

An elusive notion: a brand community can be anything from a vast base of users that new consumers seek to be part of, to a small niche that receives specialised services. Few Australians are sure of what a brand community is, while less than a quarter feel like they belong to one. That said, well over half want to be part of one – giving brands a reason to build a clear identity.

Combining these realisations can help brands go beyond clinching a sale to building a set of loyal consumers – an achievement that will be more challenging than ever and just as rewarding in the post-pandemic economy. “We see an enormous opportunity to drive business growth through post-purchase innovation,” concluded Titshall.