December 22, 2009
While the trend is not news, the recession has accelerated the rate at which consumers defected from iconic CPG brands in favor of less expensive store brands with on-par or better quality , according to an eMarketer report.
In a May 2009 study by ICOM, 59 percent of U.S. consumers reported switching to store brand food and household products over the past six months.
Of 12 leading CPG brands, only three experienced loyal consumers growth increases between the first half of 2007 and the first half of 2008, according to a study by the CMO Council and Pointer Media Network.
The remaining nine CPG companies tallied customer loyalty declines of between 2 percent and 9 percent, according to the study that analyzed the purchasing patterns of 34 million U.S. shoppers across 685 leading CPG brands and 24,000 retail stores over a two-year period.
“In today's recession, even lifelong devotees may bolt for lower-priced store brands,” e-Marketer wrote. “Offering coupons and samples does not necessarily seal the deal. CPG marketers need to get more creative, and fast. They must find new ways to reward loyalists while also luring prospects to their brands. “