Particularly after the COVID-19 pandemic, businesses everywhere realize the huge need to pour more love into marketing efforts to keep their most valuable asset happy: their existing, brand-loyal customer base.
According to Harvard Business Review, companies rocking high scores on brand loyalty and customer loyalty tend to outshine their industry peers in revenue growth, sometimes by as much as 2.5 times! And it gets even better – they deliver significantly higher returns to shareholders, sometimes even reaching two to five times over 10-year periods.
But do you want to know the coolest part about brand loyalty? The fact that it doesn’t rely on price – which makes it a really crucial aspect of driving profit and profitability.
About 65% of a company’s revenue usually comes from repeat business with existing customers. That means those who are loyal to a brand often buy 90% more frequently than new customers. Plus, it’s way cheaper to keep these brand-loyal customers happy than to go out and hunt for new ones.
In this article, we’ll go over everything you need to know about brand loyalty, giving you effective strategies to implement.
What is Brand Loyalty?
Brand loyalty differs from customer loyalty because it’s primarily built on perception and experience rather than pricing and discounts. Brand-loyal customers strongly believe that a particular brand offers superior quality and service compared to its competitors, regardless of price considerations.
While brand-loyal customers may not make as many purchases in quantity, the profit margins on their purchases are typically higher.
Once customers develop brand loyalty, it’s relatively straightforward to maintain as long as the brand continues to deliver outstanding products and services. Unlike customer loyalty, which demands constant price reductions and promotions to stay competitive, brand loyalty relies more on consistently providing an excellent experience.
Brand Loyalty vs Customer Loyalty – What’s the Difference?
Brand loyalty is about fostering a special connection between customers and the brand, built on positive perceptions over time. It’s like having a trusted friend you can always rely on, creating a sense of trust, reliability, and belonging that goes beyond just transactions.
In contrast, customer loyalty tends to be swayed more by experiential factors like services, price changes and special promotions. Factors that show that your company can seamlessly match the customer’s needs.
Brand-loyal customers are drawn to a particular brand because they know what it stands for - top-notch quality and excellent service, for example. Customer loyalty can also be tied to getting the most bang for the buck or the most convenient solution, where customers are not easily swayed, yet are aware of where they can get the best deals.
Both brand and customer loyalty rely on nurturing long-lasting relationships based on mutual respect and shared values, supported by long-term or short-term incentives.
For example, brand-loyal customers are usually forgiving of occasional hiccups or price fluctuations because their loyalty runs deep. This strong bond often leads them to stick around for the long haul and naturally become brand advocates among their friends and family.
The Importance of Brand Loyalty Strategies
Building brand loyalty is crucial because it has a significant impact on various aspects of a company:
Competitiveness: Brand-loyal customers not only have a deep awareness of the brand but also an emotional connection to it. This strong loyalty gives your brand a competitive edge in the market.
Revenue: With a loyal customer base, your brand can rely on consistent revenue from existing customers, reducing dependence on acquiring new ones. Strong customer retention ultimately leads to higher revenue for your company.
Marketing: Loyal customers often act as brand advocates, enthusiastically recommending your brand to their social circles. This word-of-mouth marketing is incredibly valuable and reduces the need for extensive marketing efforts to attract new customers. Generally, acquiring new customers is more costly for you than retaining existing ones.
How to Build Brand Loyalty – 5 Effective Steps
Established brand-name products often find themselves in highly competitive markets, competing with both new and existing rival products, many of which are quite similar. To excel in this environment, marketing teams utilize a range of tactics to cultivate and sustain brand loyalty.
This includes keeping a close eye on purchasing trends, analyzing spending patterns, and crafting targeted advertising campaigns aimed at both existing loyal customers and potential future loyalists.
Let’s explore some of the most commonly recommended brand loyalty strategies for building and nurturing a brand-loyal customer base that can elevate your business!
1. Build Brand Awareness
Building brand awareness is not just about plastering your logo everywhere; it’s about crafting a consistent and compelling narrative across all touchpoints.
By maintaining a cohesive message and visual identity across social media, email marketing, and other channels, you reinforce your brand’s presence in the minds of consumers.
Take inspiration from brands like PepsiCo, whose timeless logo and consistent branding have helped them establish a strong and recognizable identity that resonates with their audience.
2. Embrace Social Responsibility
In today’s socially conscious landscape, consumers are increasingly drawn to brands that demonstrate a commitment to social and environmental issues.
By integrating sustainability and corporate social responsibility into your business practices, you not only contribute positively to society but also appeal to the values of Millennial and Gen Z consumers.
Sharing your sustainability efforts and advocacy for social causes can forge a deeper connection with these demographics, fostering brand loyalty that extends beyond product quality or pricing.
3. Implement Loyalty Programs
Reward customer loyalty with incentives like loyalty programs or rewards programs. These initiatives can encourage repeat purchases and create a sense of appreciation among your customer base, further strengthening their loyalty to your brand.
By tailoring rewards and benefits to each customer, you show them how much you value their support, fostering a deeper connection with your brand.
Staying in touch with your customers is crucial for the success of your loyalty program. Keep them in the loop through friendly emails, engaging social media posts, and exciting in-store promotions, ensuring they never miss out on program perks.
Don’t forget to check in regularly to see how your loyalty program is doing. Ask your customers for their thoughts and suggestions to make sure it’s hitting the mark. By listening to their feedback and making improvements, you’ll keep them coming back for more and solidify their loyalty to your brand.
4. Deliver Quality Products
When it comes to product quality, consistency is key. Brands that consistently deliver high-quality products earn the trust and loyalty of their customers.
By prioritizing quality control measures and continuously seeking feedback from customers, brands can ensure that they meet and exceed customer expectations with every purchase.
Because, after all... satisfied customers are more likely to become repeat buyers and enthusiastic advocates for your brand.
5. Offer Exceptional Customer Service
Providing exceptional customer service is a crucial brand loyalty strategy.
By prioritizing customer support and ensuring accessibility through features like FAQ pages, chatbots, and round-the-clock phone assistance, you demonstrate your commitment to meeting customer needs promptly and effectively.
This dedication resolves issues swiftly and fosters satisfaction and trust, ultimately enhancing brand loyalty and customer retention.
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