Brands warned of fickle Thai buyers
published : 16 Aug 2019 at 07:33
newspaper section: Business
Consumers in Thailand and around the world are becoming more disloyal to their favourite brands, with only 8% of people globally identifying as loyal to a specific brand of product, according to a study conducted by Nielsen.
Nielsen's Global Consumer Loyalty study found that consumers are likelier to take a risk on trying new brands, driven partly by rising income levels in developing markets.
Thailand ranked among the highest in brand disloyalty, mainly driven by a desire to find better value for price.
Some 42% of global consumers say they love trying new things, while 49% of consumers that normally prefer to stick with brands they know can be moved to experiment.
Consumers in Asia-Pacific have the highest brand disloyalty. Some 47% of respondents said they are willing to switch brands or try different products, followed by Africa and the Middle East (45%) and Latin America (42%).
Consumers in North America and Europe are somewhat less likely to switch brands (36% and 33%, respectively).
Thailand is in line with the rest of Asia-Pacific, where 46% of consumers are open to trying new brands and are actively looking for new products.
"With the overwhelming majority of consumers actively or passively open to unfaithful actions, the risks for brand owners have never been greater," said Somwalee Limrachtamorn, managing director of Nielsen Thailand. "Urbanisation in Thailand these past years has increased significantly and will accelerate in the next 5-10 years as several of the government's megaprojects such as the Eastern Economic Corridor and special economic zone project are developed.
"With this, people are seeking more convenience and flexibility in both shopping and shipping, while the growth of internet penetration also drives consumers' demand for complete clarity and access to information. As consumers are presented with more options, expectations are becoming more refined and marketers/retailers need to be agile enough to stay ahead of the curve, focusing on what consumers are going to want and need."
For Thais, value for money ranked as the top factor for choosing products, with more than half (52%) agreeing it influences their decision to try new brands or switch away from favourite brands, followed by enhanced or superior quality/function (43%). Both factors also rank the highest in Asia-Pacific.
Price, added benefits and convenience are also key influencers of brand choice (43%, 43% and 42%, respectively).
"The drag effect of consumer demand for choice and voting with their wallets will overwhelm existing marketing and product development efforts if brands don't more aggressively address disloyalty in the marketplace," Ms Somwalee said.
Consumers' willingness to try new brands is on the rise, with 50% of global consumers saying they are likelier to try brands they have never tried before, compared with five years ago.
On the flip side, a larger portion of consumers in Asia-Pacific (50%), Latin America (49%) and Africa and the Middle East (42%) have high interest in new products, demonstrating a rise in brand-switching.