We know brand loyalty is dwindling - but what impact has the digital world had on the growing traction of “the switching economy?” A lot according to Derek Wilson, Head of Hippo.co.za, SA’s leading insurance and financial comparison website.
“At Hippo.co.za, we are seeing huge growth in online visitors who are comparing prices and benefits from a range of insurance providers and then switching brands. We have dug deeper into some of the reasons this is happening.”
Accenture* research recently found that customers in emerging markets are more likely to switch providers due to poor service – particularly within the retail, financial, ISP and mobile provider industries. Unlike respondents in other emerging markets, South Africans were more likely to switch despite being offered preferential treatment or rewards for their business. The research revealed that 76% of SA consumers switched service providers in the past year due to poor customer service.
Too many in-store brands
An article by Storebrands.info* highlights that many people choose to switch from in-store brands to online shopping, as there are too many options on grocery store shelves. This results in unnecessary clutter, which makes it difficult for shoppers to find exactly what they want. They therefore find it more convenient to shop online.
Price and quality
The most important and frequently reported factors that lead to people switching brands are however still price and quality. Nielsen’s* research on switching brands shows that price was the most important switch incentive for North Americans and Europeans, whereas price and quality was regarded as equally important for respondents from Africa, Asia-Pacific and the Middle East. This means that consumers in Africa consider both the price and quality they receive from brand experiences when making the decision to switch brands.
“We know more consumers are going online to compare before they buy,” concludes Wilson, “And we know consumers are not afraid of switching, it’s an interesting economy out there right now, especially as consumers are becoming more cash-strapped and seek the best value for their needs.”
Established in 2007, hippo.co.za is South Africa’s leading comparison website that helps consumers save money by comparing a range of SA providers across financial products such as car insurance, home insurance, life insurance, medical and more. Hippo is free to use and saves consumers the time and hassle of shopping around for the best deal since the Hippo.co.za website instantly retrieves real-time quotes from the different providers using the latest Internet technology. At least 8 out of 10 people could save an average of R427* per month on their car insurance.
Hippo.co.za makes money by simply charging its partners a fee when a customer chooses to find out more about their products. The results consumers see, and the order in which they are presented, is in no way influenced by the fee hippo.co.za charges its partners or any other factors other than the price of the product being compared.
For more information, visit us on www.hippo.co.za, connect with Hippo on LinkedIn, http://www.linkedin.com/company/hippo-comparative-services-pty-ltd/, like us on Facebook, www.facebook.com/HippoSA, and follow us on Twitter @Hippo_co_za and YouTube, http://www.youtube.com/user/hippocompare.
Hippo Comparative Services (Pty) Ltd is an authorized financial services provider (FSP number: 16357).
*Based on a representative market research survey conducted by Kaufman Levin Associates, on behalf of Hippo.co.za in May 2014. Risk Profile Dependent.