Pushing for new sales is, no doubt, vital to the survival and long-term thriving of any business. But are we forgetting something in this feverish race to drive growth? Or rather, someone?
It’s easy to get so fixated on acquiring leads that the very bread and butter of your income fades into the background—your existing clients.
Building customer brand loyalty is all about widening your focus and making customer retention an active part of your marketing strategy.
A 2019 retail study conducted by Yes Marketing found that more than 50% of consumers are willing to pay more for a product if it’s from a brand they trust.
This confirms not only that it makes financial sense to continue investing in keeping your customers that you worked so hard to acquire in the first place, but also that they want you to.
In this article, we’ll lead you into the basics of brand loyalty in marketing, outline some basic strategies to building brand loyalty, and look at some companies that have understood the importance of brand equity and brand loyalty.
But to see what’s what, we first need to get our definitions straight:
What Is Brand Loyalty?
Brand loyalty is defined as the tendency of customers to choose the same brands instead of the competition for a prolonged period.
In other words, it’s basically your clients’ desire to stay your customer. Unlike customer loyalty, brand loyalty has to do less with the financial reasons and more with the client’s perception of a brand—from customer experience to the company’s reputation, and even its mission and values.
In more actionable terms, we’re talking about customer retention. Essentially, it’s a measure of your ability to keep customers coming back for more, and the sum of your efforts to make it happen—after having successfully converted your leads.
Why Is Brand Loyalty Important?
In simple terms, building brand loyalty is your warranty to keeping your business in motion and growing. It’s a stepping stone for continued progress.
It’s actually easier to put it the other way around—if your business can’t keep its customers, you’ll slip back to square one over and over again, sinking money into bringing in new clients just to stay afloat.
There are four main ways you can reap the benefits of a strong brand loyalty strategy:
- Supercharge your profits
According to an Invespcro study, it costs five times more in advertising and other marketing costs to attract a new customer than it does to retain one that you’ve already brought in.
Right off the bat, that’s a considerable improvement ROI-wise, but the same study concludes that returning customers are 50% more likely to try more products and spend, on average, 31% more than a newly converted lead.
That’s a welcome boost to another metric, customer lifetime value, which gets more and more relevant as your business scales.
- Get the brand-recognition flywheel spinning
While it’s crucial to keep an eye on costs, weirdly enough, your marketing machine runs by far the most efficiently where you intervene the least. Word of mouth is king—although it’s a double-edged sword. But once people start recommending your brand to each other, you’ve struck gold.
That’s not to say it’s all out of your control. The trick is to harness the power of social media and user-generated content to make it work for you and not against you.
- Give yourself some headroom
A loyal customer base is like a backup generator for when the power goes out. By investing resources into nurturing your existing customers during the good times, what you’re really doing is building a nice little cushion for when things start looking south.
From a simple supply-line hiccup, through a sneaky new competitor rendering you second-best overnight, to a full-scale economic meltdown, there’s a lot that can send you back to the drawing board when you’re least prepared.
When the unexpected happens, it’s good to know that you’ve proven your worth, and your brand is still number one for your loyal customers.
- Shush the naysayers
Today, more so than ever, as little as a bad review can stir up a lot of controversies and force you to spend time doing damage control instead of focusing on growth. That’s especially true if you don’t have a critical mass of positive customer journeys to back you up.
Loyal clients are not only more skeptical when they see a bad review themselves, but given there’s enough of them, they can also act as a counterweight in ratings and a buffer for when your reputation suffers a blow.
How to Build Brand Loyalty
By now, it shouldn’t be a question whether the hard work of keeping your existing clients happy is worth it or not.
The know-how is where it gets interesting, especially because this part can be very industry-specific, and there’s always a lot of room for creativity.
There are a few essential areas and channels that you should devote attention to, regardless of your domain, your market position, or the demographic you’re targeting.
1. Up your customer service game
Increasing brand loyalty is all about what happens after the sale. Consistent quality and reliable customer service are costly, but they’re the most influential drivers of brand loyalty.
And it’s a classic case of what goes around comes around. Treat your customers with respect, and they’ll respect you for it.
In the following example, both the brand and the retailer answered an issue raised by their customer on Twitter. Zappos is one of the most popular companies in the world known for its excellent customer service.
2. Build your authority on trust
This is a tricky one because trust, just like in a friendship, takes time and exceptional circumstances to develop, and both are luxuries you can’t really afford most of the time.
Positioning yourself as an expert in your field, taking reputation management seriously, and even tweaking the tone of voice in which your brand communicates with your prospects and existing clients can go a long way in earning their trust.
Sometimes to prove you’re trustworthy to your potential customers, you may need the help of your past ones.
Create a testimonial page and showcase their opinions on your product or service and how they benefited from them. Testimonials will encourage others to trust your company, as well.
3. Tear down the walls with social media
How disappointed and desperate would a consumer need to be to grab pen and paper, or even just to write a complaint in an email?
I know I imagine quite a horrible scene where there’s not much left that can undo the harm anyway.
But how about social media posts? A quick instant message or comment takes seconds to write, and ideally, not much more to get an answer. The engagement is more than worth it—it actually ties into both of the points above.
A great example of social media engagement is Wendy’s Twitter profile. Whenever someone mentions them, they’ll get back with a witty reply, making anyone want to engage in a conversation with them.
4. Get their attention with an offer
Regardless of the phase of the customer journey, offers are as great to hook existing customers as they are to attract new ones.
However, rewarding customer loyalty explicitly (whether it’s in the shape of a coupon, a limited time offer, or any other incentive), this offers an exclusive experience to your customers while also giving your sales a potential boost.
For example, GoPro started a contest on Instagram, and they are offering prizes to the winners consisting of GoPro products. This way, they encourage their customers to actively engage with the brand and, in the end, reward them for that.
5. Use loyalty programs
Few people can sincerely claim their loyalty to a specific brand, and it’s somehow understandable. Everyone does their research online before purchasing something, and they’ll always stumble upon flash sales, which encourage easily changeable customer behavior.
To get those customers out of a continuously flash sale loop, attract them into your website with an offer they can’t ignore and start building a loyalty strategy based on rewards.
Consider giving special status to your customers and other non-monetary reasons to make them come back.
In other words, make people change their opinion on what true value means.
An excellent example of this practice is Sephora’s Beauty Insider rewards program, which is extremely popular. Customers earn points for each purchase, and they can later choose how to spend those points.
We all know Sephora doesn’t sell the cheapest products, but this program, based on points, helps customers redeem gift cards or discounts, encouraging them to stay loyal to the brand.
6. Build a community
Build a community, they said, and you’ll never have to struggle again. It’s true. Community is an extension of advocacy, and it’s the perfect place to make people loyal to your brand.
Since the majority of people shop online, you should build an online community. Once you know your audience’s expectations, create an online group, and bring those people together. Make them the first ones to hear about your brand’s novelties and offers.
Of course, a community can be built in other ways too. A simple hashtag will help you interact faster with your followers. The power of a hashtag can be massive. Any campaign can start with one, and all the customers will have a sense of belonging just by using the hashtag.
At one point, the community will turn into brand loyalty, and you’ll discover this when you’ll see your followers tagging you without starting a specific campaign.
7. Make sure your brand is consistent
Consistency is a crucial element in building loyalty. Customers will form a particular perception of your brand and want to feel it every time they interact with it.
So, brand consistency comes in the form of an excellent experience to be continuously delivered to your customers.
We can also talk about visual consistency. Try to maintain the same high-quality in your logo and design elements on all devices.
Visual consistency also comes in the same type of design with which your customers got used to. Ideally, you should change your visual branding elements only when you feel they don’t align with your brand identity anymore.
An excellent example of a loved brand, with an impeccable corporate reputation that also maintained its consistency and its customers happy, is Lego.
8. Deliver value through high-quality products/services
If you want to win loyal customers, you must understand they need a loyal brand in return. To secure your way of becoming their brand of choice, deliver on everything you have promised, and exceed their expectations.
Maintain a high-quality standard in everything you do. Get to know your customers’ expectations and always focus on them.
By continually being reliable with the best quality products or services, your customers won’t feel the need to go for something else.
Rocking our world since the ’40s, Fender guitars remained high-quality throughout the years, and, in return, many famous artists relied on them.
4 Main Types of Loyalty that Steers Customers to your Brand
We tend to throw the term around as if it only means one thing and one thing only.
In reality, though, there are many different levels of brand loyalty. It’s a very malleable concept that, on one hand, differs from one individual to another, but even the same person’s loyalty can change shapes depending on the situation.
Don’t let this scare you, though—it’s not like fingerprints. We can and will classify them into four easily recognizable types of brand loyalty, with examples of brands that are doing it right.
1. Price-loyalty
A bargain deal is hard to say no to the first time, let alone the second time, the third, and so on. It has one thing in mind when comparing offers: value for money.
This kind of brand loyalty, however, is only as long-lived as your offering. Once the competition drops their price below yours, they’ll move on without so much as a blink.
That said, this loose attachment is in your favor when it comes to increasing your market share. This consumer segment is the first to engage with a new product on the market, especially if it’s being offered at an unbeatable price. Once you have their attention, they’ll quickly become truly loyal customers if you play your cards right.
Example: Tesco
People who buy the grocery store’s brand products fit in this category perfectly, and all that Tesco has always stood for appeals to this calculated approach to shopping. Even their catchy slogan, “Every little helps” is an ode to rationality.
2. Benefits-loyalty
While there’s an overlap with the previous brand loyalty type, the emotion behind it all is very different. It’s true—promotions, discounts, and the likes do carry that all-important financial aspect, but they’re not the only way to attract this customer type.
They may only choose your product over the competition because it makes financial sense. Still, an exclusive benefits program like a membership, a loyalty card, or a referral bonus may turn them into your number-one fans.
Example: JetBlue Airways
JetBlue’s frequent flyer program, TrueBlue, is a classic example and just one of the many similar loyalty programs used by airlines. It offers travelers points for every dollar they spend that may even add up to a free flight in the future.
3. Convenience-loyalty
These types of customers will buy from you because it’s simply more convenient for them. Life is hard enough on its own, so if you can make your customer experience just a little bit smoother than your competitors’, congrats—you’ve just got yourself a devoted fan.
Of course, no one says no to good bang for the buck, but this category is not particularly price-sensitive. A more eco-friendly packaging, a friendlier customer service, or supporting a cause close to their hearts can earn you their loyalty, even if yours is not necessarily the cheapest solution on the market.
Example: Starbucks
Whether you like Starbucks coffee or not, we can agree that they make it really easy to buy. The mobile app and its Order & Pay feature, which shows you your previous orders gives you pairing suggestions, and even guesses where you’d like to pick it up, has radically transformed the way you get your morning joe.
4. Satisfaction-loyalty
Nothing beats good old-fashioned customer satisfaction, the ultimate “loyalizer.” People who are quite merely happy with the overall experience will come back for more without any extra incentives. Providing a high-quality service earns you this type of loyalty with no extra effort on your part.
Careful, though, because it’s fragile, and it’s just as easy to lose their trust as it was to gain it.
These customers will have no problem going to the competition if they have something better to offer, and it will probably be the first thing they do once you make a mistake. Consistency is the name of the game in both acquiring and keeping this kind of customer.
Example: Apple
Ever since the early days, Apple has built computers and gadgets designed around their customers’ needs. Feedback and engaging in conversations with consumers is a large part of their product development routine. As a result, they’ve managed to build a worldwide community of satisfied, loyal customers.
Conclusion
The importance of customer retention and whether it falls strictly under marketing or it’s a shared responsibility between multiple departments depends on a complex constellation of business decisions and the industry you’re in.
One thing is universal, though—investing resources towards brand loyalty always pays off. It means you can capitalize on your lead capturing and nurturing efforts for a longer time, thus stabilizing your revenue stream and allowing yourself to continue growing.
Remember, however, that a returning client isn’t necessarily a loyal customer. It might only mean your current offer is a cheaper or more convenient offering, and they’ll turn to the competition once you lose that certain edge.
True brand loyalty is built on positive emotions. Earn your clients’ trust, offer them the comfort they’re seeking, communicate in a relatable tone, and don’t lose sight of the key to brand loyalty in any industry and niche: customer satisfaction.