For a Brand, it's a group of Customers who used to buy their Brand and then switched to their Competitors’ Brands.
Switch Loss is when a Brand loses a Customer who was previously loyal to their Brand. This is different from a Customer who simply doesn't care about Brands in a particular category. It usually occurs when a Customer previously preferred a Brand and suddenly changed its mind to purchase another Brand whatever the reason.
🧪 Switch Loss Example
Customers currently buy Anti-Dandruff shampoo from Brand A, however, Brand B is now offering a bundled promotion of Anti-Dandruff shampoo with Anti-Dandruff Conditioner at the same price. Therefore, Customers switched to buying Brand B.
Another example is, Customers used to buy a detergent from Brand A at 7$, while Brand B offer a lower price of 5$ because they have a better deal from the Supplier. Customers, then, switched their Brand B, simply because of cheaper Selling Price offered.
💡Apart from Prices and Commercial Offer Understanding factors which drive Customers to switch from one Brand to another
- Item Availability can cause a switch loss when Customers cannot find their current favorite products / brands, and they switch to buy Competitor's products / brands
- Customers Experience - Customers who have bad experience from current favorite Item, and they switch to buy Competitor's Item looking for a better experience. For example, Customers current favorite product quality is decreasing, and Customers become frustrated, then, they switch to buy Competitor's product for which quality seems similar and consistent over the time.
- Item Change - Current favorite product composition changes or adds new features that don't appeal to Customer. It is common to prefer a brand for its predictability, stability, and usability. For example, new update facial day cream which are now included Retinol but Customer is allergic to Retinol. Therefore, Customer tend to switch to Competitor's brand with the same day cream, but without containing Retinol.
- Curiosity - Customers become bored with a Brand or its products and feels like exploring new options. For example, Customers always buys same product from Brand A. Brand B is launching a new product with additional functionality, therefore, they switch to buy new product from Brand B to gain new experience.
- Needs - Customers needs change for example, Customers used to wear Student uniform while they were in University, once they graduated, they no longer wear University cloths, but Working cloths brands instead. Therefore, they switch to buy Working Cloths brands accordingly.
- Perceptions - Customer current concerns have changed and fits more to Competitor's product. Perception can be brand image, brand culture, company values, or product style. For example, Competitor's brand has a Campaign to promote their refill laundry detergent pack which is more eco-friendly than the usual Item Customer is purchasing and matching its core value. Therefore, Customer switch to buy Competitor's product to contribute to a sustainable development.
🖥️ Make it happen in Ulys CRM
How to access Switch loss in Ulys:7 Simple Steps
Step 1: Select Switching Menu from Segmentation Menu Bar.
Step 2: Select Create a New Customer List.
Step 3: Select the scope you want to measure.
Step 4: Select Switching loss from the Shopping Behavior.
Step 5: Select Customer profiling (Age, Gender, Ethnicity, Shopping Frequency etc.). If Personal Data Protection Act related to your Country allows you to store Personal Data Information of your Customers and ONLY if you have the consent of your Customers to use his Personal Data.
Step 6: See the Segment Summary and save the Segment.
Step 7: Customer List is created and saved in the Ulys platform (Saved Segmentation Menu) and can be downloaded.