Study: Consumers Saying 'No Thanks' To Relationships With Brands

Thursday Feb 22nd 2001 by eCRMGuide.com Staff
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Impiric says performance problems and poor treatment are to blame.

NEW YORK--Despite marketers' enthusiasm for 1-to-1 and "customer relationship" marketing, a new study from Impiric, an integrated marketing solutions company, reveals that many consumers don't feel the same way.

Findings in the "Brand Partnership: What Consumers Want From 1-to-1 Marketing" study include:

  • Only a few brands have earned true "relationship" status in consumers' minds. Just 35% of consumers claimed to have a solid, growing relationship with any of the 40+ brands they use in seven major categories. The rest (65%) indicated they either have no relationship or a problem-plagued relationship with these brands.
  • Consumers' expect more from the brands they have relationships with. They expect "relationship-worthy" brands to do two things: meet their needs better than others, and treat them in a way that demonstrates they know and value them as customers.
  • Consumers cited a few brands as relationship "winners," while many disappoint. Among the strongest "relationship brands" are Dell Computer, American Express, Palm and Walmart. Among the worst: Priceline.com, local cable companies and Sprint.

"There has been a great deal of talk about customer relationship management by marketers, so we decided that it was time to talk to the consumers themselves," says David Sable, President & CEO, Impiric New York.

Impiric says the study is a nationally representative survey of 1660 US adults. Designed by Impiric's Strategy & Insights group, the study polled Americans about their bonds with a wide range of brands, as well as the factors and channels that drive them. Harris Interactive conducted fieldwork for the study.

More findings from the Impiric study include:

  • Consumers were asked to rate the strength of their relationships with over 40 brands in seven technology, service and e-commerce categories: credit cards, airlines, retail stores, websites, Internet service providers (ISP), telecommunications, home PCs, and consumer electronics. Overall, 35% indicated that they had strong relationships with the brands they used, 18% reported "problem" relationships that will probably endure, 6% had a "troubled" relationship that probably won't endure, and 41% said they "just used" the brand and had no relationship.
  • The credit card, retail store and ISP categories had large percentages of consumers reporting solid, growing relationships, while for the most part consumers slammed airlines, websites and telecommunication providers. In several categories there were both relationship "winners" and "losers."

    In the Internet service provider category, AT&T Worldnet scored among the highest % of consumers with ""solid/growing" at 65%, while Juno was significantly lower at 16%. Among retailers, Walmart (45%) beat out Kmart (30%) and Sears (29%). Delta Airlines (47%) surpassed United (21%), and e-tailer Amazon.com (39%) reports significantly stronger relationships than Priceline.com (10%).

  • The majority of consumers are reluctant to bond with brands because their expectations are not being met. Two distinct factors were identified as necessary for consumers to have relationships with brands.

    The first, which the study calls "Performance Advantage," measures how strongly consumers feel the brand meets their needs in contrast to the competition. The brand is a "power player" in delivering a basic benefit. Sony, for example, an R&D and product innovation leader, performs strongly on this relationship-building factor. First USA has neither the highest performing credit cards when compared to American Express or Discover. As a result, it has very low performance advantage ratings.

    The second key factor consumers look for in potential brand partners is "Experience Advantage," which measured whether the brand treats customers in a way that demonstra

tes it understands and values them. Amazon.com, with its personalized website that "remembers" your last visit and preferences, scores highly on this factor.

Among the brands that mainly performed well on "Performance Advantage" were Sony, Panasonic, eBay and MSN. "Experience Advantage" brands included Amazon, Discards, Delta Airlines and Gap. Brands such as Dell, American Express and Palm, which performed well in both categories, have the most solid relationships with consumers.

  • Customer loyalty programs did not stand out as being a significant driver of relationships with brands. While these types of programs do have some impact on relationship strength, it is relatively minor compared to the Performance Advantage and Experience Advantage factors. They were reported more frequently among consumers who claim to "just use" brands and have no relationship with them.

    47% of consumers in solid brand relationships reporting belong to a loyalty program, while 82 % of these same customers indicated the brands were strong on the Performance Advantage factors and 72% indicated strong performance on Experience Advantage factors.

  • Brands with problematic or troubled relationships made the most contact with consumers across channels. This runs contrary to the commonly accepted practice amongst marketers that more frequent contact, particularly 1-to-1, leads to a stronger relationship.

    Consumers with "solid" brand relationships interact with these brands an average of 28 times/year via telephone, mail, email, website or store/office visit. For brands with problematic or troubled relationships, this number is 34.

    While consumers with solid brand relationships have fewer contacts, they rate the quality of their contact higher - an average of 8.5 out of 10, compared with a score of 4 for those in troubled/non relationships.

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