Incentives Second Only To Price In Attracting Value-seeking Consumers In The Cost-of-living Crisis

2095

Brands who offer customer incentives can cut cost of acquisition and retention in the year ahead

UK consumers say that incentives will be key to securing their loyalty and custom through the cost-of-living crisis, according to new research from Edenred.
The study, which asked 2,000 consumers about how they were changing their spending behaviour in the face of the cost-of-living crisis, found incentives were more important than a range of factors including reputation or customer service in attracting customer spend and second only to price.
With the majority of consumers (54%) having already made changes to their lifestyle to cope with the cost-of-living crisis, only 15% of consumers say their household budget can accommodate further prices increases and 42% say they would need to borrow more to deal with the cost-of-living crisis.
Against this backdrop, consumers are adopting a range of value-seeking behaviours as they shop, with one-in-four consumers (26%) looking for cashback or incentives when shopping and just under a third (29%) said they were using money-off vouchers or coupons to make their household budget go further. Around a third (32%) are shopping around for the best prices.
Close to four-in-ten consumers (38%) say they are more likely to recommend a brand that offers incentives while a quarter (25%) say they will be more loyal to an existing brand. Incentives will also encourage people to switch (35%) or trial a new brand (30%).
The most attractive incentives that brands can offer are rewards for loyalty (37%) followed by cashback (35%) or vouchers (31%). A significant majority also value the opportunity to share rewards with friends and family (29%) or with a good cause (23%).
Andy Philpott, Marketing Director at Edenred said:
“While these are tough times to compete for a share of consumer spending, our research shows that brands can attract and retain value-seeking customers and avoid a race to the bottom on price by using incentives.
Whether it is by reducing customer churn, rewarding loyalty or winning new customers through refer-a-friend schemes, incentives offer every brand the opportunity to minimise the impact of the cost-of-living crisis without having to resort to price competition.
By offering customers the opportunity to give to causes they believe in or simply the ability to share reward with friends and family, brands can also build preference and differentiation through the choice of incentives on offer.
As the battle for customers intensifies, it will be the sales and marketing teams who can best deploy incentives who are likely to attract and retain customers through the cost-of-living crisis.”
To download the full report, “The battle for new customers in the cost-of-living crisis”, please visit the Edenred website HERE