COVID-19 has changed the face of the business landscape as we know it. Sudden social distancing rules combined with a pending recession has meant that customer needs and priorities have rapidly shifted. People are now reassessing what is an essential purchase versus what is an unnecessary luxury. However, amid the chaos and uncertainty, people are still remaining loyal to brands that have demonstrated value to them.
Even before the pandemic struck, one study found that meaningful brands earn a 46 percent higher share of consumers’ wallets – that is to say, people are willing to spend nearly double on companies they value. Part of the reasoning is that younger generations expect brands to play a large role in positively shaping not only their lives, but also the planet in general. It is these types of responsibilities that can give a brand real value – other features like customer service, product quality, UX, and messaging have an impact too.
Beyond loyalty, showing value has a host of advantages for companies. To better understand consumer behaviours and ways to leverage the current business landscape, here’s why customers are willing to go further for brands they value.
To bridge brands & people
Trust is always extremely fragile between brands and customers – it can be damaged by a bad experience or even external factors. For example, trust in the media as a whole has dropped during the COVID-19 crisis.
The reality is, brands cannot establish or maintain trust with consumers by themselves. Brands need ambassadors who bridge the gap between the business and everyday people. The more value a brand has, the more likely it is to have advocates who make repeat purchases, reshare content, and promote the brand to their community. Ambassadors do all this automatically and for free.
Why? Brand ambassadors have the advantage of working more closely with brands, often being asked for feedback on new products or services before they launch. They can also direct brands on how best to target appropriate audiences. This relationship creates a constant gratification loop, where the customers are guiding brand growth, and where brands have a solid representative in their market.
In fact, ambassadors are the best, most organic type of marketing a brand could hope for. According to a Global Insights Survey, ‘today’s consumers trust the wisdom of the crowd, what somebody in their network says about something’, over what a brand says about itself. If a consumer values a brand then, ‘the crowd’ anticipates that they recommend it.
To cut through saturated markets
With COVID-19 forcing millions of businesses to digitize, the surge in online companies has meant markets are heavily saturated. Prior to the virus, in e-commerce alone there were more than 20 million companies. With such a large volume and not a huge distinction between services, many customers face a long process to find, trust, and commit to a brand.
If there are brands that provide value in any sort of capacity, customers single them out and emphasize them to other people (demonstrating the wisdom of the crowd again). The idea is that by recognizing genuinely useful or ethical brands, customers can cut through the overwhelming selection of companies on offer.
That said, because competition is so fierce, it’s harder for brands to prove their value. The ones that successfully do so, are rewarded with customers who are loyal and actively contribute to the brand mission. These people go the extra mile for the brand precisely because they have already put in the effort to filter through all the market noise.
To make a difference
88 percent of consumers say they want brands to help them make a difference. This statistic is key in highlighting what customers see as value and why they respect such value. Many people believe they can create positive change but don’t have the tools to do it. They also believe that businesses have a responsibility to aid this change.
Brand value then, is not merely a business saying it supports a charitable organization, but is a business that consciously uses sustainable processes throughout its supply chain. For example, computer technology company, Dell, uses solar panels in its factories and plastics found in the ocean to make new commercial materials. Meanwhile, clothing brand, Levis has introduced a collection of jeans that use 96 percent less water to manufacture.
The planet is not the only area where people want to make a difference. Brand ethics are taken into account by many consumers these days, who want to know that staff have fair wages, good working conditions, and equal opportunities in the company. For example, Patagonia provides on-site childcare for its employees, Starbucks pays for workers’ university tuition or online training, and Salesforce has a Women in Tech User Group to advance careers for women in the tech sphere.
Brands that convey their value in the form of environmentalism and social or economic equality tend to garner the strongest loyalty from customers because these are the greatest concerns for people. Moreover, crises like the current pandemic often encourage people to recalibrate their ethics and commit to ‘doing good’ for the future. The incline in conscious consumerism means that companies position themselves as having a moral compass, and in turn, can enact real change on a long-term basis.
A mutually-beneficial relationship
Bridging the gap between brands and people, cutting through saturated markets, and making a difference are just a few of the reasons why customers go further for brands they value. For both sides, the relationship can be mutually-beneficial. Customers feel that they are buying responsibly and passing on the value to their own communities, while brands earn ambassadors, a powerful reputation, and the momentum to really disrupt their industry.
In the midst of COVID-19 – or any other difficult time for that matter – opportunities can arise for brands to pivot their existing value propositions according to new customer needs. If they can do this successfully, there is scope for brands to prove their value even further, and reap the benefits of devoted customers.