HubSpot predicts "the big switch off" as spam rates weaken customer loyalty in Australia

CRM platform, HubSpot, has released insights from the State of Customer Connection Report, conducted by YouGov, that shed light on the challenges businesses face in their interactions with customers. Issues included subpar products, customer service, and unwarranted marketing, with 44% highlighting spam as a major concern.

Amid a context of reduced discretionary spending by over 80% of Australians due to inflation, 89% of consumers reported negative experiences with brands.

The repercussions for businesses are evident, as 46% of respondents acknowledged that spam weakens their brand relationship, and 36% expressed willingness to unsubscribe altogether.

The Australian Communications and Media Authority (ACMA) has recently clamped down on spam, with fines imposed on Kmart and Commonwealth Bank earlier this year. 

See also: ACMA warns brands to “get it right” as it cracks down on spam this festive season

Globally, with 4 billion daily email users and 6.2 billion smartphone users, email and text channels remain integral to customer interaction. However, Kat Warboys, marketing director of APAC at HubSpot, remarked, "The bottom line is that effective connection is driven by quality communications, not quantity.

"The data suggests that brands aren’t routinely assessing their connection data and using this insight to inform their customer touch points. And it’s causing irreparable damage as consumers disassociate with the content."

The study found that 51% of business leaders felt the impact of disconnection in the past year, with 45% of Australian businesses identifying connection challenges as a top-three pain point. Unmet customer expectations, whether in products, services, or content delivery, leads to a loss of customer loyalty.

In the evolving landscape influenced by inflation, customer preferences for brand interaction are changing. The report indicates that 32% of Australian consumers feel some brands lack staff competency and show a disinterest in improving services.

Warboys urged businesses to reassess their customer experience strategies. "Rather than relying on the same strategies as previous years, in 2024 marketers should reassess by testing and learning and investing in the customer experience.

"Firstly, identify where your customers are happy to self-serve, and ensure you’ve enabled them to do so, and where they expect a human touch. Secondly, look at where your target audience is spending their time and meet them there – which may mean pivoting away from email marketing if your audience prefers SMS."

Warboys reassured that technology, especially AI, can help businesses work smarter and foster deeper connections with customers.

See also: Hubspot research finds AI saves the Australian workforce two days per week