How to keep customers on your side despite rising costs.

Rising costs impact consumer trust in brands, so what could businesses do to engage their customers and instil loyalty? 

There are no two ways about it, we're living in unprecedented times. This has become a popular phrase over the past couple of years, and it's undoubtedly something we'll carry on hearing as the cost of living crisis heats up. 

Mounting prices are making consumers reconsider their trust in brands. It used to be that products and service preferences were the main drivers, whereas today's customers are happy to shop around for the cheapest option. With technology making it so much easier to find the best deals and compare and switch suppliers, loyalty is now more fragile.  

So, what can brands do to improve trust and retain customers if their hands are tied when it comes to costs? Are customers really only interested in price, or are there other ways businesses can engage with their customers and garner loyalty? 

First, let's look at the data…  

Our recent research reveals almost a third (30%) of customers say rising costs are impacting their trust in brands, with over a fifth (22%) admitting loyalty to the businesses and organisations they normally buy from has dropped in recent months. 

Brand switching has become the norm, which has sadly resulted in eroding trust. In fact, our 1,000-consumer survey also revealed one in five consumers have switched supermarkets, energy suppliers or mobile providers in the last 12 months. 

As well as rising costs, close to a third (32%) of consumers say good customer service is one of the leading factors influencing their trust in brands. Yet less than a fifth (18%) of respondents said they're happy with the customer service they receive from their current provider across the finance, banking, insurance, utilities, telecoms, mobile, and retail sectors. 

Investing in loyalty to retain customers.

Loyalty programmes that offer genuinely valuable rewards to help tackle inflation are proving an influencing factor, as our survey found 75% of respondents would switch brands for a better loyalty program. Food for thought, isn't it?

At the moment, many customers feel their hands are tied when it comes to purchasing choices. The rising cost of living means many have no choice but to pick the cheapest option. Price comparison sites are making it easier for customers to find the best deals, meaning brand loyalty is taking a hit.  

Despite the financial pressures, our survey shows that price isn't everything. Customers are turning to brands that go the extra mile. Many people want a brand that cares about how it treats its customers. And if a brand has good customer service or offers something that could help ease the strain on purse strings – for example, through rewards that are actually meaningful – customers are more likely to remain loyal. 

Building trust by displaying your values.

One in 10 customers also admitted that a brand's sustainability credentials are a key factor in their purchasing decision.

Nowadays, customers are becoming increasingly conscious of their impact on the environment. Many realise that one of the key ways they can combat their carbon footprint is by buying from companies that try to limit their own environmental impact. Customers are putting their money where their mouth is, and they want businesses to do the same.

Brands that demonstrate their ethical credentials are in a much better position than competitors that aren't as responsible regarding supply chain sourcing, employee treatment or paying taxes, for instance.  

For more insights, download our full 'The evolution of brand trust' report here.