Businesses have long known that price, service, and quality are the key drivers in a decision for consumers to buy, or not to buy. Now, customers are also becoming increasingly concerned about the social and political views of companies, and it is influencing who they want to spend their time, and more importantly their cash with. A recent report from the customer review website Feefo found a huge 74% will always take into consideration for company brand values.
Feefo’s 2021 Brand Perception Report shows that nearly three-quarters of consumers in the UK want to know about the brand values of a business before they decide to invest. The report took opinions from 2000 consumers shedding light on the ways in which people perceive different brands.
It has become clear that shoppers are focusing much more on the way companies behave and their social responsibilities. Not only that, but consumers are willing to walk away or switch companies if they are not happy with a brand’s core values.
Feefo’s Marketing Director, Keith Povey says: “Today, it’s crucial that brands define their purpose and communicate it effectively to their customers. Companies need to demonstrate that by doing business with them, their customers will be supporting a transparent, trustworthy, and socially responsible brand. Our research emphasizes the need for businesses to create two-way conversations with their customers to better understand what they care about.”
1. Brands Can Help Persuade Consumer Choices
It is clear to see that it takes a lot to beat price and convenience when it comes to consumers choosing products and brands. Sustainability and social responsibility are beginning to play a part in this, but there is still a bit of customer skepticism of what companies say and what they are actually doing. Brands that do not consider their social responsibilities will begin to experience a possible downturn in their business, with 57% of UK consumers saying that companies must be socially and environmentally responsible.
Businesses have the power to persuade consumer choices by providing more options to their customers. It is no surprise that customers want a business that is able to offer them the opportunity to make an informed decision about their products. This could be locally sourced compared to imported products. This is a choice that consumers have always had, but it hasn’t always been so accessible. Knowing where to start with communicating and determining brand values can be a challenge for many businesses, but the efforts are certain to be worthwhile.
Brand Marketing and Communication Manager for Bright, Vic Hayward, says: “Understanding what your brand truly stands for should be the motivation behind your core purpose, and brand values should authentically echo this. What’s the point in having a set of values you never live, or worse, never look at again? This newer focus on brand accountability for sustainable initiatives can feel daunting for some, especially if you’re not at the forefront of an environmental revolution. For brands like this, taking a step back to reflect on your brand purpose, code of ethics or CSR policy can be an enlightening experience and a way to further engage prospects and employees.”
2. Consumers Support Brands That Champion Their Values
Brand values do not just positively impact businesses, they can have the opposite effect if consumers are left disappointed. If a company’s words or actions around a social or political issue leaves customers feeling uneasy, then nearly three-quarters said they are less likely to make a purchase from them. Technology means that scandal and negative press can spread very quickly, and consumers are often struggling to filter out fact from fiction in the online world.
More than a quarter (26%) of UK consumers stated that if their favourite business was involved in an ethical scandal, they would no longer buy from them. This can be a major blow for customer loyalty and repeat business, which is incredibly valuable. Nearly half (48%) of people said that they would be willing to give a brand a second chance if they were accountable for their wrongdoings. Just 17% revealed that they would not be affected by a scandal or poor word of mouth, admitting that every business has some problems.
3. Word of Mouth Still Powerful
Today, social media usage is so prevalent in society and there are so many review platforms providing information on businesses, that word of mouth and effective online marketing can have a powerful impact. This impact can be both positive and negative, but either way, it needs to be carefully managed by brands.
Jonathan Emmins, Founder of Amplify says: “Disenfranchised from politics, let down by celebrities and questioning brands’ ethics, consumers are looking for heroes who share and champion their values. This presents both an opportunity and a threat for brands as spending is an area where audiences know they can exert influence. Pre-pandemic, this trend was already on the rise, particularly amongst younger consumers. Amplify’s YoungBlood research that targeted 18-35-year-olds highlighted a paradox where young people’s passion and stance on sustainability meant they aspired to buy Finisterre or Patagonia, even if at this early life stage they could only afford Primark or BooHoo. We’re yet to see whether it’s a temporary or more permanent change, but facing the global challenge of the pandemic, consumers are more empathetic, aware of their impact on the world, and open to change.”
When it comes to brand ownership, 52% of consumers believe that a company is the owner of a brand, while just 13% think that the customer owns the brand.
John Galpin, Co-Founder at Design by Structure says: “Brands don’t hold the reins completely. Consumers hold power in their ability to vote with their feet. If they don’t like what a brand does, represents, or aligns with (influencers/ambassadors) they simply won’t purchase, or more importantly repeat purchase — that’s real power.”
Ultimately, the way consumers perceive brands is more important than ever before. Customers are calling out for businesses that are purpose-led and share similar beliefs and ethics to themselves. Brand values are crucial for driving sales, creating customer relationships, and improving loyalty. So, if you are just setting up a business or online business, you should carefully consider such factors.