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Viewpoint: Brand loyalty is (almost) officially dead

It is pretty much official. Brand loyalty is dying as it gets booted into touch by growing numbers of consumers during the recession. The continued search for low prices and the abundance of special offers and promotions is leading to a collapse in the levels of loyalty shoppers are showing to brands. By Glynn Davis, City editor

GENERAL MERCHANDISE

Viewpoint: Brand loyalty is (almost) officially dead

It is pretty much official. Brand loyalty is dying as it gets booted into touch by growing numbers of consumers during the recession. The continued search for low prices and the abundance of special offers and promotions is leading to a collapse in the levels of loyalty shoppers are showing to brands. By Glynn Davis, City editor

Experian has found that consumers have radically re-thought their buying routines and that this had resulted in the end of what they termed 'brand mo
nogamy'. This is leading to the slow death of brand loyalty, and the even worse news in all this is that shoppers expect to stick to these new patterns of buying behaviour once the recession is over.

Further evidence of the demise of consumer loyalty to FMCG brands comes with the publication of a new report from the Institute of Practitioners in Advertising that uses data from Dunnhumby and the Tesco Clubcard.

It shows that while promotions have increased in some categories by as much as 80 per cent (between the fourth quarter of 2007 and the same period in 2008), levels of loyalty have declined.

Although the fall equates to around only one per cent in each category this equates to a significant amount in terms of value and volumes of product sold. The IPA reckons the solution to this dire situation is for brand owners to work more closely with retailers on their promotional activity. Otherwise the supermarkets will likely continue to slowly kill off any remaining brand loyalty.

glynnd@theretailbulletin.com

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