Loyalty Matters in China

Comms8 blog: Brand loyalty in China

忠 ("Zhong") means loyalty in Chinese.  The latest study suggested that Chinese consumers are more likely to spend more and advocate their experience of the preferred brands with their peers. 

 

In the latest Epsilon's Chinese customer loyalty report, Epsilon looks at Chinese consumers’ spending attitudes and behaviours.   Their research identifies the top brands, as well as brand loyalty motivators, comparing the behaviours of loyalists and non-loyalists across product sectors.

 

This infographic highlights the key findings from the report. 

  • Loyalty Matters – Return on loyalty investment is high. 87% of Chinese loyalists were more likely to visit and spend more money on their preferred brands than their cheaper alternatives. 

  • At the top of the chart, Apple receives the highest score for brand loyalty across all categories. With their integrated online to offline approach, delivering a seamless customer service experience, something that was previously unseen in China, Apple has commanded the loyalty of Chinese consumers. 
  • Social Media is on the rise! – with 26% of respondents preferring to interact with brands via WeChat or related apps, email and mobile messaging are falling in popularity, particularly in the E-commerce, travel and luxury sectors.
  • Chinese consumers invest more in brands that can communicate and maintain excellent customer service, building up a long-term loyalty, and value quality more than brand recognition alone . 

 

Key trends by sector:

  • E-commerce:  Brands have retained the highest percentage of Chinese consumer loyalty, with brands Taobao, JD and Tmall at the top of the e-commerce brand rankings.
  • Travel: Chinese consumers are more loyal to international carriers with 88% of loyalists likely to refer brands to friends/family. 
  • Luxury: Niche Lifestyle and more affordable luxury brands, such as New Balance and Michael Kors, are gaining greater popularity than mainstream name likes Louis Vuitton, which dominated a few years ago.
  • Financial Services: The most important factor when choosing their financial service brand is how that brand suits their needs and lifestyle. 

Comms8 Inforgraphic: Loyalty Matters in China

The mindset of the Chinese consumer has seen dramatic change over the course of the years. Brands can no longer rely on price and availability to secure loyalty. With an ever increasing diverse range of brands to choose from, consumers are becoming more demanding in terms of quality and service, and willing to pay a premium to maintain product performance and endurance. 

 

With regards to customer engagement, social media is attracting more attention as an increasingly favoured platform for consumers to engage and build trust with brands. However, it is still worth keeping in mind, that this does vary across sectors, and therefore, it pays to know exactly which channel of communication your audience is most likely to be found. 

Lastly, it’s not enough to just attract customers. Brands that have maintained loyalists succeeded by committing to and rewarding loyalists through exclusive offers and excellent customer service.

 

As the research from this study shows, loyalty does reap its own rewards for brands.

 

 

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Carol Chan

London