Why shoppers stick or switch

Posted by Oliver Koll on Apr 26, 2019

In a brand owner’s ideal world all buyers of the brand would be loyal and no one would switch to any other brand. Clearly, if competitors enjoyed the same pattern there would be no room for growth. In reality, shoppers switch between brands and for numerous reasons: Variety seeking, out-of-stock, promotions, limited assortments or little brand attachment. So it is unrealistic to expect buyers not to switch, but it is worthwhile looking at when switching is more prevalent. In a new BG20 initiative, we investigate how brand-related factors (e.g., size or price), retailer-related factors (e.g., assortment size, PL-share) or trip-related factors (e.g., day of the week, retailer visited) impact switch or stick.

For example, shoppers are much less likely to choose the same brand on their next trip if

  • they visit a different retailer (even if the retailer lists the brand) – see below
  • the purchase was promoted on the first occasion
  • they are younger
  • more time has passed between the shopping occasions.

Such findings, when benchmarked against peers or against their own performance in different settings, help manufacturers understand under which circumstances their sticking rates decline disproportionately and how to counteract: They could, for example, focus on assortment optimization, size and price adjustments or activities catering to specific socio-demographic groups.