Brand switching is the opposite of brand loyalty. It means that clients stop buying from a company and choose another brand with similar products.
Brand switching is always painful for companies since they know they have a 60-70% probability of selling a product to their client, while closing a deal with a prospective customer makes only 5-20%. We can infer that retaining customers and working on increasing customer loyalty decreases your chances of facing the problem of clients who switch brands.
If your company has faced this issue, you should know the possible reasons. Read on to get to know them in detail.
4 Reasons for Brand Switching
- The price-value gap
- Poor customer service
- Brand stagnation
- Desire to conquer all niches
It seems implausible for clients to switch brands just for fun. You should know that each strategic decision can make your customers say goodbye. The price increase, the unprofessional customer support staff, desire to conquer all niches may lead to brand switching. Let's examine each problem in detail.
- The price-value gap. The price itself is not a decisive factor. Of course, buyers are sensitive to changes in pricing, but they won't make them leave you if they have a brand affinity. This term entails customers who are loyal fans of your brand. The important thing here is value. People pay not for products but for the value they provide them, and thus the tangible price increase should be justified. Clients want to see what makes the difference between your more expensive product and your competitor's analog. Make sure you can communicate this to your audience.
- Poor customer service. By poor service we mean not only unfriendly staff but the way they deal with dissatisfied customers. For example, your client received a defective item or clothes of the wrong size. The person responsible for the exchange of goods and refund plays the central role here. It should be a proactive person able to do their best to make this client happy. Once you start arguing with a customer, be ready to experience brand switching. Another critical factor here is the time your customer support team needs to respond to a client. The longer you make your customer wait, the sooner they will switch your brand.
- Brand stagnation. This issue and the next one both belong to brand fatigue. This phenomenon means that clients are tired of a particular brand. Stagnation implies a company that focuses only on producing one product and does nothing to optimize and improve it. As a result, customers switch to a brand that continually innovates to meet their clients' needs and preferences. Competition incentivizes brands to develop and improve.
- Desire to conquer all niches. This problem also belongs to the category of brand fatigue. Companies that enter almost every market scare away both prospects and loyal clients. Such dilution makes companies shift their focus from their main product, which made them successful. Recall a brand that produces carbonated soft drinks. Bet, you think about Coke. Perhaps, this is what makes this brand successful. In the end, it's impossible to succeed in everything.
Now that you know the reasons why your clients can switch your brand, we'll share some tips that will help you fight and prevent this phenomenon.
How to Prevent Brand Switching
- Be clear with your unique value proposition
- Invest in customer retention
- Provide personalized communications
- Build a winning customer support team
- Work with negative feedback
This section will offer some tips that will help you both prevent and fight brand switching. Following them will contribute to building customer loyalty.
- Be clear with your unique value proposition. UVP is what makes your brand stand out among competitors. It will help you persuade your clients that your product is the best decision. To create it, identify your clients' pains and needs and the product that will solve them better than your competitors' alternative. Be ready to explain your benefits when customers will resent the price increase. Unveil the value they will receive paying your brand more.
- Invest in customer retention. Customer retention allows brands to get higher revenue, increase sales volume, collect customer information, and build long-lasting relationships. To retain clients effectively, you need to set expectations, create a loyalty program, share killer case studies, ask customers for feedback, and use it to improve your products and customer service.
- Provide personalized communications. People love brands that approach each client individually. Carry out segmentation to create groups of clients with similar needs and preferences. This method will help you craft personalized offers for them and provide the best customer experience. For example, SendPulse allows users to collect personal data about clients via subscription forms to send segmented and personalized email campaigns. As a result, you'll get more sales and build trustful relationships with your audience.
- Build a winning customer support team. Since customers deal primarily with customer care agents, they judge the brand accordingly. The person who is in charge of conflict resolution is your best card. Your team should be close-knit, helpful, and proactive. For the best customer experience, make it work 24/7, speak the language of every client, and be able to answer immediately.
- Work with negative feedback. No matter how hard you try, you will definitely receive negative reviews. 57% of clients will switch a brand if it doesn't address the negative feedback. Sad but true. You can use a service that looks for brand mentions across any platform. Thus, once you meet a negative review, pass it to the person responsive and do your best to satisfy your customer. Depending on what went wrong, you can offer a discount for the next order, free shipping, or a special gift. Never let dissatisfied clients go.
And now you know why customers can switch a brand and have a list of effective tips to prevent and fight this. Make use of SendPulse services to build strong and lifelong relationships with your audience.
- In this article, you'll find out more about the reasons why customers switch brands.
- This article covers the topic of brand switching analysis.
- This article provides tips on how to deal with brand switching.
Last Updated: 21.03.2023
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