Loyal to Whom?

In the mid-20th century, brand loyalty was pretty easy to come by. If your Dad bought a Ford, you’d never buy a Chevy. If you grew up believing in the Yankees, you’d be dead before you’d start rooting for the Mets (and maybe not even then). It could have been called the era of faith-based marketing. Advertisers told consumers what to believe and they did.

The 21st century consumer is different. Consumers do their homework (online of course). They switch brands for a better deal. They listen to their friends opinions and don’t believe ads. Most important, they want constant assurance that you are dedicated to them, not the other way around.

It’s not brand loyalty that matters – but customer loyalty.

This change is turning loyalty marketing on its head. It’s not brand loyalty that matters – but customer loyalty. Recent research by marketing consultancy, Accenture, pointed out just how important it is to be true to brand expectations, seconded only by paying attention to your customers and staying in touch with their feedback.

Accenture surveyed 10,000 people in 27 countries regarding their experiences across ten different industries, and found that 66% had changed brands after being let down by a company. Moreover, just 23% of participants described themselves as “very loyal”, whereas 24% “had no loyalty at all”.

So, what category do your customers fall into? Brand fanatics and steady customers drive most of your business. The “very loyal” 23% are critical to your future. Their purchases drive most of your sales and their online “word-of-mouse” is what convinces others to try you.

The impact of all this should be very clear to any business that relies on social media marketing to spread the word about their brand. Companies that are loyal to their best customers get rewarded.

What are some of the simplest ways to build your own robust customer loyalty program?

  1. Make sure you can be found wherever they are looking. It’s not enough to pick your own favorite social network, you have to be present in their favorite forums.
  2. Share news that is more about relevant information, less about just new product details. Brand loyalists like being the “first to know”. They are looking for inside information that makes them feel privy to what’s happening.
  3. Reward your best advocates – whether you offer a contest, exclusive product discounts or special programs just for them. Airlines have done it for years because it works.

Data sourced from Accenture, February 2012

One Response

  1. Michael Bradley
    March 2, 2012 at 1:52 AM | Reply

    Hello Caroline,

    Your article is timely in many respects and syncs perfectly with ongoing discussions in these parts concerning the cost/ benefit sides of branding as opposed to some less obvious alternatives that perhaps provide a large share of the benefit while reducing the incredible cost side of the equation required to create a brand. We are in touch with all retailers marketing our products as well as consumers using them and hear from both on a daily basis. Compulsory but thoughtful training and education of the retailer is essential and we believe, the cornerstone of our success. In some cases the retailer is not aware of the consumer talking on the other phone line who just purchased one of our products in the store the day before and had a question or answer that they felt needed clarification. One of the most rewarding, (from every possible angle), experiences is to be in such close and immediate touch with both sellers and users simultaneously. This vital link is not necessarily tied to a name as much as a principal and process. In fact, we have noticed a growing disdain for what is traditionally thought of as “Branded” products in the commonly understood , (monolithic), meaning of the word. Our customers love the idea of purchasing from a local specialty store owner/retailer whose name appears on the product and has all the critical information concerning the product essential for understanding and appreciating the difference between what we offer and what is generally available through traditional retail channels, including the internet.

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