Consumers are ready to leave their favorite brands behind. Nearly 90% of shoppers say inflation has made them more likely to switch brands, especially when it comes to the food they buy, according to new research from Attest.
The survey of 2,000 U.S. consumers conducted in February found that most consumers believe brands are raising prices beyond what’s necessary. But price increases aren’t the only reason they stop buying from certain brands.
Rising prices drive down loyalty in grocery
Eight in 10 consumers believe brands are using inflation as an excuse to raise prices, otherwise known as “greedflation” — 53% feel that this is happening a lot, and 27% say it’s happening somewhat. More than half (58%) believe the government and/or media should do more to discipline brands that are guilty of this practice.
About three in four consumers (76%) feel they’ve seen the highest “greedflation” price increases in grocery products, well above categories like energy (37%), travel (27%), and clothing and shoes (27%). So it’s not surprising that they’re most likely to switch food and beverage brands (71%) when they need to cut costs. Brands that want to hold on to customers amid rising prices should consider their ESG (environmental, social, and governance) performance — sustainability is one reason consumers will stick to their preferred brand, rather than trading down when prices are up.
Categories where consumers are less likely to change brands, according to Attest’s survey, include health and wellness (24%), pet products (22%), and vice products like alcohol and tobacco (17%).
Consumers want brands to take responsibility
Aside from price increases, which 33% of consumers say is the top reason they would stop buying a particular brand’s products and/or services, brands are also likely to lose customer loyalty due to negative experiences (33%), bad customer service (14%), and high profile controversies (6%).
While about one-fourth of consumers will immediately stop buying products and services from a brand that’s involved in a high profile controversy, most (35%) will give the company time to issue a public statement before they decide to boycott. It’s also worth noting that 23% wouldn’t take any action in response to a brand’s involvement in controversy. But it largely depends on the issue surrounding the controversy — certain issues are more concerning to consumers, including racism (42%), other forms of discrimination (35%), and treatment of employees (35%) and animals (32%). Political and regulatory matters fall lower on the list.
When it comes to righting the wrongs, more than half (55%) of consumers expect brands to be completely transparent and address how they intend to correct the issue at hand. More than 40% believe brands should issue a public apology.
For more industry insights, see the latest research from Attest.