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BizReport : Research archives : May 06, 2010

comScore: Loyalty may not be enough in economic pinch

Loyalty may not beat price point, at least at this point in the economic recovery. That, according to a recent comScore report which found that even loyalty consumers are influenced by price point as they try to save more money. The report finds that, although most consumers want to continue showing loyalty to their favorite brands, they are now finding price point a dictator of exactly what brands they buy.

by Kristina Knight

Just where are consumers trading down? According to the report about 12% of Apparel purchasers are buying less expensive brands, 7% of Health & Beauty aids are now choosing cheaper alternatives and OTC Medications buyers are choosing less expensive brands. And, of the consumers who say they buy their favored brands no matter what there has been a 10% to 15% decline in purchases in Health & Beauty, OTC Medications and Apparel.

"A decline in loyalty to consumer goods brands is typically one of the byproducts of a recession as consumers give greater consideration to price," said Gian Fulgoni, comScore chairman. "Research we've conducted at comScore ARS has quantified the impact of the 'trading down' effect within a number of different product categories, highlighting consumers' increasing willingness to switch brands in the face of pocketbook constraints."

Within the segments, there is also a disparity between which areas consumers choose brand and which they choose price. For example, consumers choosing a branded mouth rinse has declined by 17% since 2008 and their choice of branded shampoos has declined by 13%. In the Apparel category, jeans brands are most likely to feel the effect of consumers not spending and in the OTC Medication category cough and allergy brands are most likely to feel a cooling in consumers' choices.

Tags: brand marketing, brand shopping, comScore, loyalty marketing, price comparison, price point

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