Why do customers switch brands?

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If you have a business, it’s essential to have a strong brand, especially in today’s competitive marketplace. Customers recognise brands and prefer those that they trust. This brand awareness may begin with an advertising strategy, but it then develops over time and as the customer converts and has a direct experience with the brand.

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Although companies put in a lot of work and money to build their brand within their target audience, their brand ‘equity’ or the perceived value of the brand within their market, can be rapidly damaged by a bad experience. An example would be if a customer has a bad service experience or if the product doesn’t live up to their expectations. To avoid these types of issues, many businesses use a brand strategy agency to help them.

Why do customers end up switching?

There are various reasons why customers switch, and a brand strategy agency will have experience in anticipating and mitigating these situations before they happen, as well as tackling any brand damage that may have already occurred. Typical causes of a brand switch include:

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1. A cheaper competitor offering a similar product at a lower price

2. The customer experiencing something negative with the brand – such as bad customer service

3. People seeing negative reviews about the brand in the marketplace

4. The brand experiencing bad PR, for example, because it doesn’t have ethical business practices

5. Trends in the marketplace leading to broader switches – for example, customers no longer buying disposable plastic bottles, and switching to reusable or eco-friendly bottles

Avoiding brand switch risks

As you can see, the drivers behind a brand switch can occur at any stage of the product and market lifecycle, and can be driven by external and internal factors. A brand strategy agency will help a business to anticipate these risks using tools such as PESTEL analysis and also Porter’s Five Forces.

Businesses can also look at each stage of the marketing journey – covering product, price, promotion, people, places and so forth to identify any risk areas. Where risks can be identified, the brand can put in place mitigating strategies that protect its equity and which help it to remain strong and secure within the marketplace. This could involve strategies such as changing the packaging or product itself, improving customer service, reworking retail channels, adjusting the price and so forth.

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