You must have seen advertisements where a new product bought by a customer causes a stir in the entire neighbourhood. And suddenly, the product becomes the talk of the town and encourages other people to do the same.
Take another example of an advertisement where a certain product, let's say an automatic washing machine, positions its owner as a woman who is smart, savvy and an environment enthusiast.
All these marketing techniques are very common, and you can find them everywhere, promoting different products and brands. But the one thing that remains the same is the psychology behind this, i.e. social identity.
Every consumer in the market has a social identity that affects their preferences and responses to a certain product. Social identity is influenced greatly by the community to which a person belongs.
Therefore, to market and sell their products to people, organisations must have a proper understanding of the concept of consumer social identity. Organisations may receive favourable responses from their existing and potential consumers by tapping into the right social identity of a group.
This theory holds an important place in the marketing world as it explains consumer behaviour and how organisations can use it. Below, we have mentioned factors that make this concept crucial for business organisations.
A consumer's identity can affect a business in many ways. Proper identification, the community they belong to, and the context can be the difference between a successful and an unsuccessful marketing campaign.
Tapping into customers’ desirable image
People are constantly using products and brands to create an image in today’s world. The image that a person wants to project depends heavily on the community they belong to. Intensive research on people's social behaviour around different groups and in different contexts can bring out how people want to position themselves in society. This can help companies create a brand image that fits their target audience's needs and desires.
Consumers who are more connected to their social identity and community are more likely to associate themselves with a brand that they think represents their image to other people. Companies can use this as an advantage to attract more and more people with strong consumer social identities to position their brand with a specific quality or a strong USP.
Consumer is king. Organisations have realized this in modern times. Due to globalization, competition has increased, and customers have many choices. The best way to get a customer's attention is by providing a product that suits the consumer's social identity.
The marketing strategy and consumer experience can be customized according to the needs and demands of the target group. This gives the organisation an edge over the competitors.
Converting potential customers into real consumers
Before making a marketing strategy, companies conduct various researches to understand consumer behaviour and preferences. From data collection to preparing a strategy to sell the product, social identity and the context in which it regulates play an important role. In many cases, people who respond positively to a product may not do the same in different contexts or social situations. This provides an incorrect estimate of potential customers and incorrect judgement of the marketing strategy's success.
To convert potential customers into real ones, organisations should observe their customers in different contexts, i.e. how their identity changes their reactions to the brand. Only then, the organisation will get a correct sense of consumer social identity.
Building brand loyalty
Many groups of people like to associate themselves with different brands to represent their social identity. This social identity can be changed easily. Marketing research, if done right, can tell the organisations a lot about the social identity of a certain group. By tailoring your brand to give out a certain image that fits the social image of the target audience, colonies can create brand loyalty.
Companies can gain insight into a person's social identity using various tools. This may include keeping information about a consumer's locality, age, social media, occupation, etc. This information collected by the organisations is sensitive and should be confidential.
Consumers are very concerned about their information, where it goes and how it is used. They are willing to give the information to make the experience smoother and more customized, but in return, they want security and anonymity of their data.
Implementing a robust CIAM solution can protect consumer data. These solutions provide authentication features like multi-factor and risk-based authentication to ensure that the consumer identities are always protected. The CIAM also allows customers to use their social identity to access applications.
CIAM enables personalisation and privacy by providing self-care controls that enforce consent and privacy at various stages of operations. It is beneficial for both businesses and customers.
Businesses can benefit from greater customer engagement and loyalty by providing customers with a platform that keeps their shared information safe. Customers, on the other hand, get the assurance of a secure and confidential experience.
Today, data is king. Sensitive information about the social identity of consumers is used by organisations for many reasons, but it's also organisations' responsibility to maintain privacy. This can only be achieved by investing in the best CIAM.