Proprietary model identifies consumer segments that are most likely to switch to and away from any given brand, and why
QuestionPro, a global leader in online survey and research services today announced the availability of a proprietary “switchable consumer” research model that helps brands cost-effectively reduce churn and acquire new customers. This approach uses surveys to derive individual brand-choice probabilities to identify both prospects who can be persuaded to switch from a competitor as well as which existing customers are at risk to switch to a rival.
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According to Ketchum’s Brand Reckoning 2020: How Crisis Culture Is Redefining Consumer Behavior, Loyalty and Values, brands are at significant risk for churn. “Nearly half of those surveyed (45%) report they have changed at least one brand preference already, and a majority (62%) expect that their brand preferences will change permanently before the pandemic is over,” a press release announcing the report notes. “For some, the importance of brands will be diluted; 63% report they will purchase more private label items in the future.”
It’s thus now more important than ever for brands to identify who among their existing customers are at risk for flight. But equally important is to identify consumers of rival brands who are switchable. The new model from QuestionPro does both.
The switchable consumer approach uses a logit-based driver model through surveys of both customers and general population consumers. The survey begins with questions that reveal brand preference and is followed by a series of questions that asks the participant to evaluate the relative importance of a series of attributes. From there, a binary or multinomial choice model is developed. The result is data that shows what percentage of consumers are switchable and what attributes would be likely to make them consider trial or change.
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Marketers, revenue officers and brand managers can use this approach to not only target at risk customers and switchable consumers with messaging specific to key attributes, but also make changes operationally to strengthen areas or attributes that could be contributing to churn.
“In normal times, the switchable consumer model enables extremely cost-efficient marketing by identifying and targeting only consumers most likely to switch,” said Dan Fleetwood, President of Research & Insights at QuestionPro. “But at a time where consumers are changing preferences and trying new products on a daily basis, it’s critical for brand marketers to use every tool available to both attract new customers and reduce churn.”
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