Capgemini
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How to build emotional loyalty in the COVID era

2nd Dec 2020
Capgemini
Blogger
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COVID-19 has caused a change in consumer spending behaviour.  With government lockdowns bringing in-person shopping experiences to a halt, and triggering a rise of online shopping, there’s no doubt consumption habits have been redefined. .

From the drop in high-street footfalls, to the rise in impulse buying and a new gravitation towards brands that demonstrate purpose – the pandemic has reshaped the retail landscape.  In fact, recent research from Capgemini underscores this point with more than half of respondents stating that they expect organisations to showcase their sense of purpose and give back to society both during the crisis and beyond. For brands, this means forming a deep and personal connection with their customers through establishing a foundation of emotional loyalty.

During this fast-paced and unpredictable environment, retailers need to be certain on their purpose and next steps to maintain their pre-crisis focus on customer relationships and engagement. While purpose and profitability should be kept separate in the mind of the consumer, the benefits of brand purpose is essential in the current Covid era, with purpose-driven organisations growing at more than twice the rate of other organisations according to Kantar.

As a result, retailers need to step up by showcasing their actions and dedication by giving back to society and community. We have picked out four key areas that brands should explore to showcase this responsibility, which in turn will help bring back loyalty.

1. Supporting staff

As the impact of the pandemic spans across the country, with fear, anxiety, and low-moods rife - kindness and compassion are essential.

Brands can demonstrate this sense of purpose through putting action to their words by supporting their staff through this challenging period. We’ve seen great examples of this such as supermarket Tesco increasing staff discounts on products to 15%, while Morrisons launched their ‘Colleague Hardship Fund’ which aims to support employees who are in financial difficulty as a result of the coronavirus outbreak.

This creates a great dialogue between employer and employee – with brands taking on measures also assists win back the loyalty and trust of consumers.

2. Assisting at-risk groups

With Covid-19 presenting a graver risk to elderly and vulnerable people, brands need to show compassion and special consideration to these groups. While displaying a more personal side, this behaviour assists brands through demonstrating an unquestionable care for people in high-risk groups, which may also improve quality of life at a much-needed time.

This has been exemplified by setting exclusive hours and separate ordering channels for the elderly while also allowing essential health workers a period to shop un-interrupted. Many supermarkets including Waitrose, Sainsbury’s and Morrisons all created a special time frame, usually earlier on in the day when the store is at its cleanest, to allow vulnerable and elderly people to shop for their groceries – keeping the store less busy and customers’ minds at ease.

3. Bolstering suppliers

Supporting staff should not stop with the brand name. Building a reputation and establishing relationships centred on trust must mean that every link in the supply chain is valued and considered.

This could be looked at in many ways such as through providing finance for struggling, yet strategically important, suppliers or logistic operators – particularly smaller or more vulnerable ones in the chain. While homing in on brand’s integrity to their purpose, this would also assist with maintaining operational continuity.

Unilever, for example, has offered a £438m of cash flow relief to support its small- and medium-sized suppliers in its supply chain. Part of this included early payment to assist with financial liquidity and extending credit to small-scale retail customers whose businesses were reliant on Unilever. While fashion retailer Primark committed £370m to its suppliers, accepting all products that were either in production and finished while their stores remained closed.

4. Community donations

While many communities are continuing to struggle, the lack of in-person contact has meant that many charities have been hard hit. According to research, a massive 77% of charities have said Covid-19 has impacted their finances, with 72% stating there has been an increased demand for their services as a result of the pandemic.

Half of all consumes agree that retailers have a responsibility to help the community by using their resources for good. We have seen large companies such as PepsiCo pledging to direct $45 million to communities hardest hit by the pandemic. Meanwhile French sporting retailer Decathlon announced plans to donate 30,000 snorkeling masks to hospitals in France and Spain to help overcome ventilator shortage.

Looking to the future

With the majority of UK consumers feeling pessimistic about recovery in the next sixth months, it’s inevitable that the way we consume and how we think about consuming is changing. Buying responsibly and looking after our communities are central to our shifting purchasing priorities.

With brands taking a step in the right direction, companies can use their resources to support people and safeguard livelihoods. In terms of customer loyalty companies can re-envisage what it means to have purpose, making ‘giving back’ a reality rather than just a sound bite.

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