Consumer choice vs brand loyalty: how businesses can resolve the tension

We’ve all been there: the Black Friday buy we don’t need but that has 40% off; the delivery option that burns more fuel or adds more packaging but will get our shiny new things to us faster; the purchase of the latest book, beauty product, fashion item or gadget because everyone else has one.

In today’s complex society, decisions like these are an everyday occurrence – for many, they’re a multiple-times-a-day occurrence. We’ve been led to believe this is a good thing, but dig beneath the surface and a different reality emerges. As suggested in Keeping up with the consumer, a new report from the Kearney Consumer Institute, the array of choice on offer is overwhelming consumers rather than empowering them.

At a time when people’s scepticism of institutions is high, brands should pay attention. For example, Kearney research suggests that 48% of consumers globally don’t think brands have their best interests in mind, while 58% feel the same way about influencers.

It’s estimated that 30,000 new products are introduced in the US each year. Is it any wonder shoppers get stuck in the crisps or chips aisle or can’t make sense of all the different milks on offer? This “analysis paralysis” can also lead to consumers backing out of decisions, for example adding items to their online shopping basket that never make it through the purchasing process.

Seemingly endless choice also affects loyalty. On the one hand, shoppers are less incentivized to stay loyal, helped by the fact that switching costs are lower than ever; on the other hand, overwhelm can make consumers default to old favourites or tried-and-tested brands so they don’t need to think about it or be forced to decide from a dizzying array of options.

The consumer choice conundrum also creates tensions for brands. For a start, it’s more difficult to understand where consumers truly want or need choice (and where they don’t) and which elements of products and services they value (and which they don’t). This could lead brands into dangerous territory if they’re not careful.

For example, the misconception that more choice equals a better consumer experience could result in brands trying to do too much and spreading themselves too thin. It could be tempting to copy what seems to be popular for other providers, thus diluting your own unique value proposition. In this scenario, brand innovation takes priority over product quality, potentially alienating consumers who still value performance and reliability.

The net result is a potential triple whammy for brands, consumers, and broader society:

1. On the brand side, a perceived lack of authenticity quickly leads to confusion and loss of trust, both significant problems in their own right.

2. There’s also a potential negative financial impact on consumers who can’t afford everything they are buying (or being encouraged to buy).

3. Going beyond these immediate concerns, there are deeper issues around sustainability and the environment, topics about which many brands have made ambitious claims. If we take haul culture – the trend for purchasing large amounts of goods to wear once or showcase them online – this not only encourages over-ordering and excess returns; it is also largely built around fast fashion items that are produced cheaply and largely viewed as disposable.

In this environment, how can consumers make the right choices and how can brands help them do so in a way that meets both parties’ needs?

The first thing brands should do is make sure they are getting the fundamentals right. This means quality products that are relevant to customers’ lives and circumstances. Let’s face it: you can’t deliver a “wow” moment if you’re failing to meet basic needs. Brands would do well to understand more about the psychology of buying and what consumers really need and value.

The second aspect of building genuine connections is to foster authenticity and trust by deciding what you are really about as a company and zooming in on that. Instead of trying to be all things to all people, brands that recognize the conflict and tensions in this are more likely to deliver on their promise and less likely to confuse or discourage potential buyers.

Thirdly, it’s about finding ways to connect with consumers that communicate this authentic personality. For example, we are increasingly seeing brands step out of their signature niche in terms of the partnerships they form, the channels they use, the interactions they create and even the language they use. From KFC's crisis communications during a chicken shortage to Barbie's modern rebranding via Hollywood, brands are re-engaging with their identities and appealing to consumers in more relatable, authentic ways.

The fourth element is about improving the feedback loop with consumers. It’s crucial to know what you stand for as a brand, but it’s equally important to know and reflect what consumers think you stand for – which can sometimes be quite different.

Like most relationships, there will always be a level of tension between what consumers want and what brands provide but that doesn’t mean it’s game over. To manage this tension, brands can see it as an opportunity to pursue a truer understanding of consumers’ needs and wants, creating a more solid connection.

The good news for companies? For one thing, there’s the default human setting of seeking the familiar. This not only helps consumers avoid having to think about certain purchasing decisions, it also makes the job of unravelling the consumer conundrum and taking overwhelm out a far less daunting proposition.

Perhaps more importantly, while the lessons outlined here have largely been drawn from consumer goods companies, they can be applied to every type of organization that provides products and services to others. Here’s to a simpler buying experience – for everyone.