Monday, January 23, 2017

Supersize Switching with Superconsumers

When customers keep shopping with you, that’s great. When those customers keep buying identical brands from you, that might not be great. There are times you’d like to encourage brand switching because it would benefit the customer and your profitability. A chief example is a switch to house brands—private label brands—which usually offer you higher profit margins than do the corresponding national label brands while also allowing you to offer your shoppers a price advantage.
     Consumers are more open to brand switching when moving from one role in life to another. This happens with college graduation, getting married or getting divorced, having a first child, and changing careers. However, you might not want to wait until a major life change occurs to switch the brand preferences. In this case, results from a set of studies at University of South Australia should interest you. These studies looked at brand switching in the opposite direction: How is it that brands attract new customers from those who had been using other brands?
     The answer is that it begins with the shopper giving the new brand a try for a while. The ten brands in the study, reflecting a range of consumer goods, which increased market share consistently were achieving more growth from trial users than from repeat purchasers.
     Building on this finding, it looks like your best odds for brand switching are with a category of shoppers researchers at Cambridge Group and Nielsen Company call superconsumers. These are people who are always seeking a broader range of products in a particular category. In the research on 124 consumer packaged goods categories, superconsumers accounted for about 10% of the category’s purchasers, but 30% to 70% of sales. Because they don’t require the same degree of marketing push to buy more from the category and because they aren’t highly price sensitive, superconsumers are a major source of revenue. The researchers identified a group of stapler superconsumers who owned, on average, eight of the devices. Researchers at Fairfield University and Louisiana State University found a similar phenomenon with shoe purchases by people they named “acquisitive shoppers.”
     These consumers are especially open to brand switching because they’re consistently expanding their horizons within the product category. Recognize the desire for ever-changing product specifications. Even though these customers stay alert to differences in seemingly identical items, assist the process by pointing out differences in brands yourself.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Increase Store Loyalty Using House Brands
Educate During Life Changes
Slow Switching by Asking About Prior Choices

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