Is loyalty just skin deep? Brand switching in Singapore's personal care market

By Pei Yoke Loh

Over a six month period, three in five consumers tried an alternative personal care brand to their usual purchase, according to our recent research.

This research forms part of a broader assessment of brand switching across a range of consumer goods categories, which we have called The Great Defector Study.  We chose to focus on the personal care market in Asia because of a profusion of brands and a buoyant market, with annual growth of 6.4% expected from 2015 to 2020.

It came as no surprise that advertising and promotion are the highest drivers of ‘defection’ – 71% of consumers bought a new brand because of advertising or promotion of the alternative brand.  Another major influence (particularly in personal care products) is point of sale (POS) marketing.  36% of consumers had tried a new personal care brand because of POS promotion; 35% of these were offered a free sample, and 24% purchased because of direct selling from an in-store promoter.

Across the categories evaluated in our study, people were attracted to different brands more by pull factors (e.g. advertising and product innovation) and less by push factors (such as dissatisfaction with their current brands).  The conclusion is that simply trying to satisfy customers with your product offering is no guarantee of customer retention.

One way to retain customers is by innovation. Consumers love browsing, and they love new products and innovation – especially in low risk purchases such as FMCG.  Product innovation combines technology and personalisation elements.  The personal care category sees frequent product innovation: a customised serum based on consumers’ skin condition, skin identification quizzes or moisturisers with hydration sensors embedded in the cap to determine how much product the consumer should use.

However, it’s worth noting that some people defect to alternative brands simply because of a lack of availability of their current brand, amounting to 28% of brand defectors.  To retain customers, brand owners in this category have to maintain their widest distribution across retailers.  Trade marketing can therefore be as important as consumer marketing.  BVA BDRC applies its proprietary trade brand equity technique Brand Margin® to help brand managers understand and showcase to retailers the financial value that their brands can command, and compelling reasons for retailers to stock their products.

For more information on this study, or the Brand Margin® methodology, visit our Brand Margin® page, or get in touch.

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