Consumer Brand Loyalty In A Recession (Final)

Pulse Breakfast Series ‘09 Consumer Brand Loyalty in a Recession

The Economic Landscape

2008/09 Global Economic Scene “ Consumers continue trading down across spending opportunities.” “ Regardless of categories, consumers will adopt new mindsets, new behaviours, and new habits during the year to come.” “ The outlook for the global economy continues to remain bleak. IMF has estimated that world economic growth will fall to 0.5% in 2009, which is the lowest rate since World War II.” “ Consumers are making tough choices about the products they purchase and where, and they are looking harder for value.” "The outlook for the national economy, the outlook for the local economy relative to the national economy and the outlook for local sales growth range from moderately to deeply negative."

2009 Malaysian Economic Scene The Malaysian economy contracted at a slower rate of 3.9% in the second quarter of 2009 due mainly to higher public spending and positive growth in private consumption. Growth continued to be affected by weak external demand and private investment activity. All economic sectors registered improved performance with construction, services and agriculture registering positive growth, according to the Department of Statistics Malaysia .

The Survey

Methodology Objective The survey aims to study consumers behaviors and opinions towards the current economic outlook in their respective countries. How did we achieve this? 7 countries were selected (Australia, China, Hong Kong, India, Malaysia, Singapore, Thailand) to participate, where 500 national representative random respondents were selected from Planet Pulse in this 15-minute survey.

Facts and Stats

State of Economy 2009 Which of the following do you think best describes the current state of the economy? Which of the following describes what you think of the current state of the economy compared to 6 months ago? Although most think that the current state of economy is neither strong nor weak, many find it better compared to 6 months ago Base = n500 National Rep Malaysia 49%

Spending Habits How has the state of the economy affected the way you have spent your money in the last 6 months? More than 60% claimed they spent money more cautiously than before while almost half expect to continue spending cautiously in the next 6 months How does the current state of the economy affected the way you expect to spend money in the next 6 months? Base = n500 National Rep Malaysia 61%

Brand Loyalty Based on the current economic situation, how loyal are you to your favourite brands in the following categories? While many consumers are cautiously spending their money currently, most are still expected to stick to their favourite brands of FMCG such as personal care products, daily food items, and children’s milk powder Base = n500 National Rep Malaysia

Loyalty Drivers What would you say is a real loyalty driver for you? Value is main loyalty driver Base = n500 National Rep Malaysia

Brand Switching Factors What would make you switch brands amongst the following categories? Price is THE factor! Base = n500 National Rep Malaysia

Price Factor in a Recession Most people are more price-sensitive now and would consider switching products at a lower price. The recession has also effected where people shop. Base = n500 National Rep Malaysia

In today’s economy, would you like to see more or less advertising? How important are advertisements about promotions and sales? More advertising, please. Most find ads on sales and promotion important. Advertising Needs Base = n500 National Rep Malaysia

Are you attracted by tactical promotions and mega sales offered by retail outlets? What form of advertising is most effective to you? Advertising Platforms Print, TV, Online most effective Tactical promotions are working Base = n500 National Rep Malaysia

Which medium suits you best? Media Preference Online is the most preferred medium among respondents. A survey by Google South-East Asia reveal that 59% of active online consumers cite search engines as a specific source for researching a new product while 79% use the Internet during the purchase process Base = n500 National Rep Malaysia

Asia Economic Weather Map Base = n500 National Rep Malaysia

Conclusion

CONTINUE TO INVEST IN MARKETING

Less clutter, louder voice

Base = n500 National Rep Malaysia 2 ENGAGE WITH YOUR CORE Strengthen relationships with your Core audience 3 ADD AND DELIVER VALUE Enhance your proposition to Sensitive shoppers 4 RESEARCH AND INNOVATE Risk being different 5 GO DIGITAL Reach and engage customers With Media 2.0 6 BE TACTICAL Keep you ears close to the ground and be ready to react to changes swiftly

What’s Next…

Thank You! [email_address]