Why Brand Loyalty is Dead on the Web
It has been suggested that many mainstream demographics have not yet chosen their brand online, in stark contrast to their offline worlds. But will they ever chose a brand, or will they just chose whatever comes up first in Google? With the cost of switching being zero, is Brand Loyalty online dead?
The low cost of switching
Mike Moran suggests that Brand Loyalty might “not actually dead, but when loyalty is finally put to rest, its gravestone might say “I told you I was sick.“” Moran attributes this to the low cost of switching on the web.
When Web shoppers’ actual behaviour is monitored, it demonstrates that brand loyalty is on the wane…
Today’s typical Web shopper behaviour is not to head to a favourite online store—shoppers go instead to their favourite search engine and let fly. Whatever sites are shown in the search results become the consideration set for that purchase.
If your well-known brand name appears in the search results, it triggers more clicks than a “nobody,” but that is the extent of brand value today—it doesn’t draw people to your Web site the way it drew them to your physical store.
- Just 21% of web shoppers desired information about the brand. The rest wanted price comparisons and detailed product info.
- 92% of all Web users employ search engines such as Yahoo! and Google to shop or purchase online.
- 92% of searchers never use brand names in searches before making a purchase.
- And even those who do use brand names don’t start there—they start by using generic names at the outset. Only after their generic searches find some brand names do they search for brands (as they get closer to an actual purchase decision).
My experiences and anecdotal evidence certainly backs this up.
- Users are not afraid to give unknown websites a try.
- They are not afraid of the back button.
- In fact, they’ll give a site about 5 seconds to convince them it’s what they wanted.
- If it isn’t, they’ll go back to the search engine and try the next site down. It’s not cost anything.
- Actually, even if it was what they wanted, they don’t trust your website (brand or no brand), so they go back to the search engine and try the next site down anyway. Why not?
They’re not even that loyal to Google
Even Google, the one brand people will argue users are loyal to does not necessarily enjoy brand loyalty online. In a survey by Harvest Digital, the majority of people reported using Google, but notably:
- Only 24% reported that they use a single search engine.
- A full 20% said they regularly used four or more search engines.
But users do talk about online brands
One of the common counter arguments is that people DO search for brands online (if only 8% of searches), and they certainly mention only a small number websites in discussions – usually recognised brands. In fact, studies have shown that users only visit (or recall) six websites on average. Is this not brand loyalty?
Here are a few sites that have reached the masses and why I think it’s not the brand that’s driving what little loyalty they might have:
- Google – They’re loyal to the fact it is the internet – it gives results. Until it doesn’t, then they’ll try another one!
- Amazon – Can you name another place to find every book you could ever think of? (The Long Tail) And even users do go to Amazon before a search engine, they are often just researching and will then Google for the book name just in case they can find it cheaper elsewhere.
- eBay – Name a competitor. Go on, I dare you.
- MoneySavingExpert– This site is hugely popular in the UK and always gets mentioned in research. But are people actually typing in the URL or are they just on the email mailing list? Most people can’t even remember the URL – they call it ‘money saver.com’ or ‘money expert.com’ – guess what, it still comes up #1 or #2 in Google.
- TripAdvisor – The mainstream rave about TripAdvisor. But if they want to make sure their holiday hotel isn’t a hell hole, they search for the specific hotel in Google. They are more likely to click the tripadvisor link if it comes up first, and are pleased if it does, but they’ll try whatever comes up. And then they’ll go back to Google and click on the next link just to be sure.
- ASOS – Repeat purchases are not to be confused with brand loyalty. Is ASOS their first port of call to look for clothes, or are they just responding to email or magazine marketing for that particular dress they’ve been shown?
- mySpace – Are users loyal to myspace, or the significant amount of time they’ve invested in setting up their profile and gathering ‘friends’? Why are they also on facebook and bebo?
- Yahoo – Aren’t they just passing through on the way to checking their email?
- VirginMedia – Does their ISP give them any choice, or is this their homepage they can’t change?
Wired.com thinks that whilst there are more brands than ever, they’re “taking a beating” or even worse, being ignored. They place the blame squarely at the new breed of hyperinformed superconsumers. And the web is powering it.
The importance of search engines, even if you’re building a brand
A study by iProspect found that 36% of people believe that companies whose websites are returned at the top of the search results are the top companies in their field. Just 25% said that top search engine rankings had nothing to do with market or brand leadership. But UK users, despite relying heavily on search engines as a significant source of information, don’t trust the results they get.
- Just 22% of users reported that they were confident that search engines would always give them the information that they needed.
And what’s important to them on those results pages? Brands?
- 43% of searchers said that the most important reason for clicking on a result was that it appeared on the first page
- 32% said the relevance of the description was most important
- 17% saying that a result at the top of the first page was the most important criteria.
- And just 8% said that a reputable brand name or website was important.
Okay, so it’s a controversial stance…
“Brand Loyalty is Dead” is a always going to be a controversial statement, and there will of course be counter arguments. BrandChannel.com posted the topic up on their site for debate, and this quote stood out for me:
“Brand loyalty is not dead, it’s just more like loyalty to a girl/boyfriend than loyalty to a husband/wife. “
– Gili on BrandChannel.com, 27-Jan-2005
What do you think?