Spend an afternoon browsing the web for something as menial as a baking pan, and you’ll find that there are hundreds of companies peddling what appears to be the exact same product. Scrolling through various products, you notice that they check off the same boxes for what you want in a pan. The decision may be inconsequential, the results, the same. In this scenario, what is it that prompts you to choose one baking pan over another? Often, it has to do with brand loyalty, a driving factor in a consumer’s decision-making process when it comes to making a purchase, no matter how insignificant.
McDonald’s Global Chief Brand Officer once famously called millennials “brand promiscuous“ in talking about how difficult it is to earn their brand loyalty. He had a point: the younger generations have more options available to them and are less likely to stick with the old standby time and time again. They are far less brand-conscious than generations before them.
Finding customers is relatively easy; it’s keeping them that’s the hard part. But, have a strategy for connecting with a loyal customer base, and you’re well on your way. A market research study found that 50% of consumers were willing to pay more for a comparable product if it’s from a brand they trust. No matter how great your startup business ideas are, if you can’t connect with your demographic through brand loyalty, you won’t make that sale. Below, we’ll discuss the concept of brand loyalty and how to build customer loyalty in an authentic, meaningful way.
You’re probably asking yourself, precisely what is brand loyalty? Brand loyalty refers to the frequency a consumer buys your product over the competition within a particular market based on their positive associations with your brand. Brand loyalty is influenced by a company’s public image and reputation, aesthetics, and how closely it aligns with consumers’ values, goals, and perceptions. In essence, brand loyalty is about identity, both yours and the consumer’s, and brand-loyal consumers will choose your brand over another out of a sense of alignment in identity.
Customer loyalty refers to repeat customers who buy your products or services based on their merit. It comes about more from the consumer’s purchasing process than from the brand’s marketing. Customer satisfaction is at the core of a repeat customer’s decision to purchase from a specific brand. Whether or not a customer has had a positive experience with your brand is the factor that determines whether they will become a repeat customer. Their willingness to continue purchasing from your brand based on satisfaction with your product is the basis of customer loyalty.
It’s easy to see how trying to define brand loyalty and customer loyalty can be confusing, but the two are not the same. Brand loyalty happens on a more psychological level, whereas customer loyalty is less ambiguous and more actionable. Customer loyalty has a tangible effect — more sales — and occurs on the logistics of your product or service (price, value, quality, better discounts or rewards, etc.). Customer loyalty is the bread and butter of your product, while brand loyalty comes about as a personal, human reaction to a consumer’s feelings about your brand.
Put simply, brand loyalty can lead to customer loyalty, which generates customer retention. This means less effort and time spent trying to catch a bite from non-customers in the hopes of converting them to your product. The strategy here is to focus on meeting existing customers’ wants and needs, customers who you know will continue to buy your product. It’s an investment, but, like all sound investments, it pays off in the long run. What does it mean to be loyal if not devoted, and who doesn’t want devoted customers?
Don’t forget about your current customer. A recent retail survey estimates that it costs companies five to seven times more to acquire a customer than to retain one. Acquisition funding is the number one reason you should care about your brand loyalty; it sets off a chain reaction that leads to more sales and is cheaper than trying to source new customers. Developing strong brand loyalty is essential for increasing customer loyalty because consumers do not purchase on logic alone; they also base this decision on everything that factors into how they feel when they buy something.
A company that cannot retain its customers will spend most of its marketing dollars continually cycling through one-off purchasers. While this may work for some larger companies that make millions of sales every day and have no shortage of constant onetime customers, most small businesses rely on a select few “frequent flyers.”
It’s important to note that brand loyalty is an internalized phenomenon in consumer behavior. Brand loyalty correlates with sales when the consumer purchases from a company solely by choice, not due to pressure by the brand. Loyal customers stick with the brand even as the market changes and other choices--perhaps even objectively better choices--become available.
For example, let’s say a consumer is looking for new denim jeans. They could go nearly anywhere for a pair of jeans: clothing stores in the mall, discount stores, and even online. However, instead of shop around, they head straight to a Levi’s store. What’s more, this consumer goes to Levi’s whenever they need jeans, without thinking twice about it.
The brand-loyal customer will instinctively purchase from a brand — even if another company offers a comparable product at a lower price. The comfort, familiarity, and feel-good association a customer has with the brand and the experience of buying from that brand are enough to convince a customer to purchase from your company again and again.
When trying to understand how brand loyalty is fostered, you need to grasp the brand loyalty definition. Understand that a customer will rarely purchase a product about which they are cognitively dissonant or causes them mental discomfort. That is, unless the quality of the product far surpasses their dedication to their values, it’s likely a consumer will avoid buying from a brand that they find fault or do not identify with. They are far more likely to purchase from a brand to which they have a personal connection.
The key to building loyalty is to first understand what customers want from a brand like yours. As time moves along, consumer expectations change — what was once a non-issue is now at the forefront of buyers’ minds. A consumer favorite brand realizes how important brand awareness is to the brand loyalist. For example, consider companies that heavily advertise their products as eco-friendly. This targets the large subset of consumers who are environmentally conscious and want their products to be as well. When an environmentally conscious consumer purchases from a company that promotes eco-friendly products, the brand loyal customer feels that they have commonality between the company in that they possess the same values and are working towards the same goals. If a customer feels this connection with a particular brand, they will likely make a repeat purchase. They may even become brand ambassadors by spreading the word.
It’s also important to acknowledge that consumers want to connect and form valuable relationships with their purchases. They want to feel good about themselves and what they spend their money on. Often, we have an emotional bond with the things we spend money on. Brand loyalty plays off of this desire by establishing the basis for a connection between brand and consumer.
Below are some actionable steps you can take to help promote brand loyalty and elevate your existing customer base to a loyal customer base:
The first tenant of building brand loyalty is to make it feel as authentic as possible to the consumer. Ask yourself: what are your actual values as a company? You can then play up these values in your marketing campaigns. However, there’s a fine line here. Don’t discount your customers’ intelligence; it’s fairly easy to see through when a company is “woke washing.” Try too hard, and it will fall flat and even damage public perception of your brand as overly strategic. If your brand is as genuine as it claims to be, that authenticity will shine through this brand strategy.
Brand consistency is important in becoming a favorite brand. If your brand marketing is all over the place, your customers won’t have any particular thing to latch onto. In scattering your messaging, your appeal may be broad, but it will be shallow. Visual cues are vital in maintaining consistency. Take a brand like McDonald’s, for instance. Almost everyone in the world is familiar with the golden arches. Your logo, too, should be instantly recognizable.
While it’s true most consumers don’t like to be bombarded with promotional materials every other day, it’s important that you keep frequent and consistent communication. There’s plenty of ways to do this without being a nuisance.
Engagement helps you avoid the spam folder. Staying engaged can be as simple as soliciting reviews after purchase, saying a simple “thank you,” or hosting events.
When you do communicate with your existing or potential customers, make sure it is to promote something newsworthy, like a sale, event, or product launch. Promotional material shouldn’t be purely promotional. It should be informative, exciting, and entertaining. Give your customers something to interact with. Keep your messaging short and sweet.
This is the fun part of earning brand loyalty; you can experiment with various communications like email, videos, and social media. On that note …
Social media is both a blessing and a curse for brands. It’s the easiest way to go viral and stir business; it’s also the easiest way to garner bad publicity. Consumers often post about brands on social media platforms like Twitter. The great thing about social media is that should a complaint be made, you can swiftly respond to it. You can also promote special offers, events, and directly interact with your customers and provide quick one-on-one support.
With the Internet and social media, your brand is on display to the entire world. The pressure is on, but don’t worry too much — most consumers don’t expect brands to be perfect. What’s important is how you respond to complaints. Do you deny them, divert blame, or handle them with grace?
Nothing is more important than customer experience in gaining a brand loyalist. When you receive criticism, don’t just tell customers what they want to hear. Listen to their feedback and make a real effort to do better. Being known as a company with robust customer service will make consumers more forgiving toward you and, in a way, will make you look even better than the company without public slip-ups. Your response alone helps you control the narrative and has the power to turn bad publicity good.
This is perhaps the most straightforward step you can take; it’s in the name. Many companies have programs that reward repeat visits. Starbucks’ rewards program is an excellent example of this. The Starbucks rewards program is an all-in-one marketing machine designed to keep customers coming back. Through the rewards program app, they promote their credit card, payment methods, and mobile orders. There are even loyalty tiers within the program. While your customer loyalty program does not need to be this comprehensive, you would certainly do well to take a page out of Starbucks’ book.
Creating a “community” around your brand goes a long way in gaining loyal customers. As previously discussed, humans have a natural tendency to seek out and form community, and giving people a platform to do so through your brand is a great way to maintain long-term engagement. A great example of this is activewear company Senita Athletics, which brands itself as a “sisterhood.” Senita projects an image that is inclusive, supportive, and non-threatening. This is often exactly what people who are new to fitness are looking for in an activewear company.
You won’t win your customers’ devotion overnight. But, through persistent effort, you may see your percent of return customers steadily increase. That will lead to a higher ROI, which is reason enough for the effort.