Sustained growth harder for brands as Aussie consumers less impulsive
With a sluggish global economy, Aussie brands are struggling to lock in growth. Less than six per cent of brands will grow market share over a year, and of those brands, only six in 10 will sustain growth, and just one in 10 improving on their initial growth.
New Kantar research, Mastering Momentum, finds 88 per cent of Australians are ‘less impulsive’ in their buying behaviour so brands must now work much harder, says Kantar Australia Head of Brand Guidance, Gareth O’Neill.
“96 per cent of Aussies questioned said they were already familiar with the brand they had bought and of these, 67 per cent ‘knew a lot’ about it. Clearly brand exposure and familiarity still play a significant role in how consumers navigate purchase decisions, but it can’t end there. It’s disappointing to find that more than half of Aussies (56 per cent) feel they are not valued customers of the brands that they use.”
“The experience is perceived differently across generations, however. Interestingly, it is Millennials that are feeling the love (66 per cent feel like ‘valuable customers’) – much more so than Baby Boomers (22 per cent).” And this engagement is paying off in terms of loyalty. Aussie Millennials (39 per cent) are more brand loyal than other generations – Gen X (30 per cent) and Baby Boomers (28 per cent); however, the majority of consumers across all ages are still open to switching, and that is driven, unsurprisingly, primarily by price and promotions.
“It’s a fact of life,” says O’Neill. “Brands not only need to convert pre-disposition into sales, but they must also compete for those consumers that are not predisposed. It’s about balancing your efforts between those long- and short-term levers; but also, never forgetting the power of experience. Four in ten switchers are motivated by a ‘better product’ – 17 per cent due to dissatisfaction with their current brand, while a further 16 per cent switch based on recommendations”
Mastering Momentum also investigated touchpoint behaviours and attitudes, giving greater insight into opportunities across the path to purchase.
“Digital technologies are critical gateways to building a familiarity and predisposition towards the brand,” says O’Neill. “But brands must worker harder to use this tech to connect effectively with Aussie consumers.”
“Just over one-third (37 per cent) of Australians say their mobile is central to discovering new brands – this is actually around half of the global average (64 per cent). While Aussie Millennials are more digitally savvy when seeking brand information (67 per cent – aligned with global average), Australian marketers have a lot more work to do to leverage this medium in a meaningful way.”
As programmatic technology improves, the advertising that consumers see is becoming more focused. Just one-third of Aussies (36 per cent) find ads they see are relevant to them – but 45 per cent have clicked on a social media ad in the last three months. Platforms like Instagram are now being used as a central ‘discovery’ channel with people scrolling through to find new brands in the same way that they would a physical magazine.
As for influencers, “we see their rising importance,” adds O’Neill. “51 per cent of Millennials discover brands through the influencers they follow, but don’t assume it will work for your brand,” he warns.
“Do your homework and understand the specific context to your brand. Influencers are not a panacea, and Millennials are certainly not naïve – 56 per cent don’t trust influencers and know they’re paid to advertise brands.”
“Consumers are now far more discerning and are making decisions based on a layered understanding of the brand, built up over numerous interactions. Brands that want to grow in a sustainable way need to make sure they have their finger on the pulse of all of these moments. They need to understand how interactions in the short-term can contribute to the overall long-term picture.”
“For the best chance of success, marketers should focus on effectiveness at three key points in the consumer cycle,” says O’Neill. “These are ‘exposure’ to influence future sales, ‘activation’ to influence immediate sales, and ‘experience’ to influence repeat sales. Getting the combination right will create and influence sustained growth. Sustained, long-term growth is hard, but there is a huge opportunity for brands that invest effectively in their brands across these moments. They will be the ones that thrive and grow regardless of economic fluctuations.”
Consumer research for Mastering Momentum in Asia Pacific is based on a survey of 2,209 internet users across 11 countries: Australia, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, Vietnam. The survey was conducted in May and June 2019. Respondents were specifically questioned on their habits with regards to financial and personal care products. The BrandZ™ findings are based on data from 3,907 brands contained within the BrandZ™database, measured over a three-year period across 21 countries and 58 product categories.
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