Fuel & C-Store Perspectives: Next-Generation Gasoline Loyalty
Published in CSP Daily News
Consumers' brand-switching behavior evolves as they get older: NPD
PORT WASHINGTON, N.Y. -- The percentage of consumers loyal to one brand of gasoline has been in general decline for several years and is down six points over the past decade, according to a recent report from The NPD Group Inc.
The percentage reporting they "always buy one brand" measured 28% in the first quarter of 2009, compared to 34% in the first quarter of 2000. Several factors can be blamed for this trend, including the proliferation of big-box retailers offering fuel, the emergence of regional, private-brand c-store chains and volatile and rapidly rising pricesjust [image-nocss] to name a few, according to the report provided exclusively to CSP Daily News.
But could there be a more fundamental shift occurring in the consumer base that influences repeat brand purchase? Among the many variables that could be examined to answer this question, age trends stand out as offering some intriguing clues.
Older consumers (those over 65) have always been more likely to limit brand choice to only one brand, while younger consumers historically have been more willing to shop around. As younger consumers age and displace older motorists, will their brand shopping ways stay the same? An analysis of data from Port Washington, N.Y.-based NPD's Motor Fuels Index suggests this is the case.
When comparing first-quarter 2009 loyalty measures vs. the same period in 2000, the age group that experienced the greatest decline was the 30-to-44-year-old age segment. In 2000, 18- to 29-year-olds were the least brand loyal; in the intervening nine years, many of them brought their brand switching behavior into the 30-to-44 bracket.
Compared to overall brand loyalty, the 30-to-44 age group is now the most likely group to try multiple brands among those who have purchased a major brand. Expect this trend to continue as drivers ages 18 to 29 also exhibit less loyalty than previous generations. This group is beginning to be influenced by the "echo boom," which will be the largest generation of drivers in the history of the automobile.
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The NPD Group is the premium provider of consumer information for the North American petroleum marketing and convenience retailing industries. Industry leaders utilize the essential market information available in NPD's Motor Fuels Index and Convenience Store Monitor to assist in making more effective business decisions.