Mounting price pressures are making many re-evaluate the brands they love. Despite sticking with their favourite products and services, a growing number of people say the need for better value is now an increasing need as prices rise.
- 55% of consumers remain just as loyal to their preferred brands as before the pandemic began. However, one in four (39%) are now looking for better value for money when it comes to some of the goods and services they purchase as the cost-of-living crisis hits.
- Similarly in the current account market, 33% claim to be very loyal to their existing provider, but nearly one in five (18%) feel that the cost-of-living crisis is forcing them to seek out more help like additional overdraft facilities. One in ten (10%) believe that they now need banking services that can help them better track their spending.
- Jo Ainsley, Senior Service Lines Manager at Pay.UK discusses the current account switching process and Consumer psychologist, Kate Nightingale, offers her top tips for those looking to break their brand loyalty, and shares insight into the psychology behind switching.
Most consumers have emerged from the pandemic with an unwavering sense of loyalty to their favourite brands. However, the tide may be turning as, for the first time, many begin thinking about whether switching away from their favourite brands could help them combat the ongoing cost of living increases. That’s according to new research conducted by the Current Account Switch Service.
In its latest research, the Current Account Switch Service found that 55% of consumers remain just as loyal to their preferred brands as before the pandemic began, with 52% of people stating that they would not think about switching from their current favourite brand unless it ceased trading.
Brand loyalty is particularly prevalent in relation to banks and building societies (30%), supermarkets (25%), mobile phone manufacturers (20%) and insurance (18%) providers, which were among the most common areas that consumers expressed a solid sense of brand dedication.
However, while most know the brands they like to buy from, four out of ten (39%) are now looking for better value for money when it comes to some of the goods and services they purchase. People are also increasingly aware of how brands align with their personal views. A quarter (26%) of people would be motivated to switch to a more ethically conscious brand, and 20% to a brand that was found to be more environmentally aligned to their views.
Current account switching
Default loyalty is particularly prevalent in the current account market. The Current Account Switch Service found that 29% of those that feel less likely to switch (post-pandemic) say that their existing provider’s performance through the pandemic has boosted their sense of loyalty. This is despite alternative current account options offering a better fit for their needs. One in five (22%) of this group also claim to be too busy with other things to switch current account.
When asked how they feel towards their existing current account provider, 33% claim to be very loyal and that it would take a lot to see any benefit in switching. One in eight (12%) claim they wouldn’t ever switch to another provider.
However, nearly one in five (18%) feel that the cost-of-living crisis is forcing them to seek out additional help like overdraft facilities and one in ten (11%) believe that they now need banking services that can help them better track their spending.
Jo Ainsley, Senior Service Lines Manager at Pay.UK, commented: “Given the current cost-of living- crisis, many people are now thinking carefully about their finance. While breaking brand loyalty to certain products and services can be difficult, switching to better options in many cases can be incredibly simple and stress-free. Switching current account is a great example of this.
“Through the Current Account Switch Service, people benefit from a service that’s free to use and handles their move from one account provider to another in seven days and its guaranteed. This takes the stress out of switching and means people could be benefiting from improved online banking services that help them better track their spending and even gain access to switching bonuses.”
Consumer psychologist, Kate Nightingale, added: “The unprecedented nature of the pandemic plunged many of us in a deep state of anxiety. As such, we’ve turned to brands that provide us with a sense of familiarity. This ‘default loyalty’ shouldn’t stand in the way of our wellbeing. With price pressures mounting, it’s now increasingly important that people challenge their own perceptions and think critically about how considering a new provider that could better align with their needs and help them save money.”