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What's brand loyalty and why does it matter, anyway? Learn how brand loyalty leads to success, and get tips on how to boost and measure it.
Brand loyalty is the modern-day marketer’s equivalent of a fairy tale romance. It’s the kind of devotion you can only get when a brand hooks its customers with unforgettable experiences—whether it’s through incredible customer service or awesome products.
Building brand loyalty needn’t be as hard as many make it out to be. Think of it this way: You can find your perfect match—in the marketing world, that means making sure your customers feel supported and appreciated by your brand or business.
Give them what they want, which starts by finding out what that even is.
With the right techniques in place and some savvy strategy behind it all, you can craft customer relationships that will weather any storm. Here we’ll take a look at why building consumer brand loyalty should be at the top of your to-do list this year, and how to tackle it.
The relationship between a customer and a brand can be quite powerful: it could make someone go out of their way or pay more than they’d usually spend, simply because they love your brand so much.
Strong brand loyalty is like the cool kid in school you can’t help but follow. It’s when customers turn away from other options and are almost blindly devoted to one particular product, service or company.
This kind of commitment is noticed and encouraged by brands, which often leads to them rewarding their loyal customers with exclusive offerings and discounts.
Whether it’s an Apple devotee refusing to purchase any other type of phone or a Starbucks stan who’s turned down every cup of coffee from anywhere else, brand loyalty can express itself in many different forms.
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It’s almost as if some people have taken their mothers’ advice to always buy quality goods, and decided to take it one step further by only buying from one brand. Brand loyalty is an important concept for businesses as it means devoted customers who are likely to return again and again – even when better deals are available elsewhere. That comes with some huge benefits, let’s dive into them.
One thing that’s killed many businesses is aggressive price competition, or a price war.
A price war is ‘when companies continuously lower prices to undercut the competition. A price war may be used to increase revenue in the short term or as a longer-term strategy to gain market share,’ according to Investopedia.
In such cases, only the goliaths will survive, because who can compete with Coca-Cola or Amazon on price? If they want to lower their prices, they can, with minimal negative impact on the business.
Brand loyalty makes consumers less price-sensitive. And, if there is genuine brand loyalty, you will be able to retain customers even if you face stiff price competition.
This helps you to maintain margins (think of Apple’s continued hold on the premium end of the market), and increase profitability, which in turns allows you to invest more back into the business, producing a better, differentiated experience for consumers.
This is the kind of positive cycle every brand wants.
As we touched on above, loyal customers are relatively price agnostic—a change in price will not affect their purchase behavior to the same degree as non-loyal customers.
In our report into consumer perception of brand purpose, we found that 55.5% of consumers are willing to spend more to buy from brands they really care about.
However, this isn’t just about sensitivity to price rises—it’s also about selling your products or services at a premium to others in your market.
Think about supermarkets’ own brand water, versus Highland Springs, Volvic, Evian and then Voss right at the top end of premium. They’re all essentially selling the same product: bottled mineral water. However, the brands they’re building allows them to charge incrementally more.
That’s great brand building!
New businesses are less likely to enter a market with fierce brand loyalty, and, therefore, you have more protection against loss of market share.
Imagine trying to dislodge Amazon as the preferred online marketplace, or Google as the first-choice search engine. Not impossible, but a daunting task for sure.
Here it’s important to add a note of caution for incumbent brands—brand health and loyalty should never be taken for granted. Many once-strong brands have succumbed to competition by assuming their market position and positive customer feelings would last forever.
Your loyal customer base is worth a lot, more than what they spend. Customer retention is so much cheaper than any marketing tactics needed to get new customers.
And it’s not just that new customers are more expensive to acquire than existing customers. They may also be more demanding—they need helplines and customer care because (a) they don’t know the company/products/services as well and (b) they need to be treated well while they are shopping around. If you don’t give them good service, they can just go elsewhere because they don’t yet feel loyal to your brand. While this is true of all customers, it is particularly the case for new ones, because they’re not yet invested in your company.
If you can keep customers coming back, and keep them loyal, your customer service costs will fall. Furthermore, lumped in with this is the cost of onboarding new buyers. This is traditionally an expensive process for any company—you do not need to market and sell quite so fervently to loyal customers.
Loyal customers can become an extension of your own marketing team. It’s something we see more and more today, as people become zealous about their favorite brands. How many people have you heard debate the benefits of Uber Eats over Deliveroo, or the other way around?
Amazon, Eventbrite, Ella’s Kitchen—there are so many diverse brands who built up leading market positions because of their relentless focus on customer service, which in turn translated into positive word-of-mouth promotion.
The potential for your customers to become advocates can be measured by Net Promoter Score (NPS), which is just one of many brand health metrics you should know about.
This graphic, created by the Applied Psychology department at the University of Southern California, is a helpful tool for understanding the essentials of brand loyalty:
These things can be hard to measure, but they are the very nature of what makes people loyal to a brand—beyond price.
In a sense, brand loyalty is about human emotion—it’s about our imperfect, irrational way of making decisions, because, if we always took the ‘best deal’ on the market, the likelihood of any repeat business would be gone. But that’s not how most humans work. They create bonds, affiliations, and opinions based on feeling.
On ‘feeling’, there are a number of ways that a brand can create a strong image of itself, and one that aligns with its customer. Let’s look at some steps to take when building that brand loyalty.
Some brands have everything in place for exceptional brand loyalty, except for one thing: a clear brand that people can actually connect with. Your brand attributes play a huge role in this. Next we’ll dive into some of the most important ones, but these are two you don’t want to miss out on: language and color
Innocent Smoothies is a great example of this. The tone and language of their marketing is slightly child-friendly and innocent. Their brand is about honest, well-sourced and healthy products, so bringing in that language has created a strong brand that people can relate to.
Almost every brand has a few core colors that define almost every piece of marketing. Apple is built on silver, black and white, denoting simplicity, technology, and a futuristic feel. Barclay’s calm their customers with baby blues to soften their ‘bankiness’. Monzo are fluorescent coral to bring in younger crowds who want to define themselves by their bank card.
This is something brands are moving towards more and more: adverts and products increasingly have a ‘you’ feel about them.
They become so personal that you almost cease to care or remember what the company is selling.
Customers are more likely to come back if they can trust the products or services they receive from your business. Show that you care by taking the time to make sure every element of production is done right, and that each customer gets the best experience possible. Doing this will give customers confidence in your business, setting the foundation for long-term relationships.
Social media is an invaluable tool when it comes to building your brand loyalty—but only if used correctly. Don’t just post ads or content—actually engage with your audience and get them involved in your business!
Ask questions and take feedback seriously, then follow up with consistent communication on all platforms. This will remind people of why they like you in the first place, plus create a sense of community that encourages others to join in on the fun (or serious conversations).
We’re not going to lie: sometimes brand loyalty love stories simply start with a company offering deals that are too good to pass up on.
Think of what truly great incentives for returning customers you can give, because it shows that their repeat purchases mean something special to you as a business. Offering discounts, free swag, exclusive offers—whatever works best for you—will help keep customers coming back again and again!
This also creates an element of surprise that’ll make them feel appreciated while they explore new products or services from your company.
The customer experience is one of the most significant factors when you’re building customer loyalty. You have to make people feel engaged in the brand.
Nothing does that quite like making the customer associate personal experience with you, and, importantly, making an experience out of the interaction with your brand. Everyone wants to be treated well when interacting with businesses they support—so don’t disappoint them!
Whether through email, over the phone or face-to-face interactions, always be polite and professional in order to leave customers feeling satisfied with their experiences. You may even want to consider using surveys or other forms of feedback after each interaction so you can understand what people need out of every exchange with your company.
Aside from repeat sales, brand loyalty—tied up so often in emotional feelings towards a brand—is notoriously difficult to measure.
But if you can’t measure it, how can you manage (and improve) it?
We would suggest you take a blend of 3 critical metrics that—taken together—can help you provide a quantified and measurable view of your brand loyalty.
Net Promoter Score: How likely are consumers to recommend your brand/product/service to a friend or colleague?
Purchase Intent: How likely are consumers to choose your brand/product/service next time they need to solve a particular problem that your business helps to solve?
Sentiment analysis: How would consumers describe your company, and is the net sentiment of their words positive or negative?
Measure your brand loyalty
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This provides you with a robust, 3-point system for triangulating your brand loyalty, which can be tracked over time. Over time, are you enhancing and growing brand loyalty, or is it dipping and should you be concerned?
Brand loyalty starts with knowing your customer, and your target audience. It’s no good to simply drop prices and expect people to come back again and again; you need to carve out your niche, and engage with consumers in meaningful ways.
Ultimately, a brand needs to speak to its customers; not only will this develop that illusive ‘good feeling’, but it will help build an understanding of who your customers are, and what they value.
If brand loyalty is something you want to measure and improve, check out our tools for brand tracking. We’ve got templates ready to go so you can start getting to know your soon-to-be loyal customers.
The Experts’ Guide to Brand Tracking
How to look at the impact of things like audience reach, panel diversity, and survey design to help you decide whether your current brand tracker is up to scratch.
Customer Research Principal
Alexandra joined Attest in 2018, with a strong background in market research. In the Customer Research Team, Alexandra takes a leading role in supporting brands to uncover consumer insights and explore new opportunities for growth.
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