How Politics and Hashtags Changed the Face of Retail
Political polarization, voter tribalism, and more recent and fervent social movements like #grabyourwallet, #MeToo and #TimesUp have changed the face of brand engagement and consumer loyalty in the retail category, according to new consumer values and insights identified in the Brand Keys 23rd Customer Loyalty Engagement Index® (CLEI).
The annual survey conducted by the New York-based brand engagement and customer loyalty research consultancy has identified new consumer values that have combined to create unprecedented shifts in retail category values that “define” how consumers will view a retail category, compare brands and options within a particular retail category, and how they will ultimately buy, buy again, and remain loyal to one retail brand vs. competitors.
The important news for retailers in all categories is the fact that the “how” in retail has changed dramatically in 90 percent of the sectors tracked by Brand Keys. The fact is consumers aren’t looking at retail categories in the same way they did a year ago.
The shift in how consumers view retail categories resulted in brand leadership changes (and accompanying same-store sales and profitability) in 40 percent of the retail categories tracked. These leadership and perceived-value adjustments are startling in and of themselves, but the fact that brands haven’t had to deal with this kind of political polarization or social turmoil converging on consumers all at the same time is the truly noteworthy red flag for retail marketers. Many are totally unprepared to deal with these kinds of category and value paradigm shifts, and more social networking isn’t the remedy. Yes, all categories are sensitive to value shifts. Some are just more sensitive to one set of values than others.
The survey found that political polarization and tribalism included values related to personal responsibility, moral order, family values, fiscal conservatism and established social structures.
The retail categories most responsive and susceptible to those particular values were:
- Natural Foods
- Price Clubs
- Home Improvement
- Discount Retail
From a social activism point of view, leveragable values included empathy, equality, empowerment, individualism and pride. In this instance, retail categories most reactive to those values included:
- Athletic Shoes
- Department Stores
- Online Retail
- Sporting Goods
The shift in values, whether driven by political polarization and tribalism or social activism, has affected how consumers engage with brands. “Brand engagement” is best defined by how well a brand is viewed by consumers to meet the expectations they hold for the values that drive purchase behavior in a given category. For example, in apparel, personalization and customization are making a greater contribution to consumer engagement and the consumer perception of what’s ideal for them than ever before. In the sporting goods category, being viewed as a specialist can make the difference between making a sale and losing a customer.
While the aftermath of our most recent presidential election has raised levels of political debate, it has also raised more contentious issues, more social activism, and has created far more value-infused and complicated paths-to-purchase for consumers. The result has been enormous changes in what consumers really want and equally enormous gaps between what they want and what retail brands are seen to be capable of delivering.
Ultimately what it will come down to for retail marketers is their ability to accurately identify their category ideal — not from their own perspective or definition, but from consumers’ own points-of-view.
As those views have become more emotionally driven in the past decade, the addition of tribal political and activist values have transformed the brand space into something retail marketers haven’t faced before. If marketers think they knew what consumers’ “category ideals” looked like before, they're going to need to take a very hard look, very quickly at themselves, because as of now consumers have an entirely new view of what's the ideal for them.
The bottom line: Consumers are only going to buy from retailers that can deliver on what consumers define as “ideal” and what they truly expect.
Robert Passikoff, Ph.D., is the founder and president of Brand Keys, Inc., a brand engagement and customer loyalty research consultancy.
Related story: What Do Consumers Expect From Retail?