Michael Heusner
Oct 22, 2019

Brands don't understand value of customer loyalty: Study

Far too often, loyalty is a tactic to drive relationships instead of being the foundation of the relationship itself."

Brands don't understand value of customer loyalty: Study

Brand marketing professionals have a dangerously outdated view of customer loyalty, according to a new report from the CMO Council.

The report, entitled Loyalty that Lasts, found that "while product and price are still key elements, customers actually want to like—if not love—the brands they do business with… they want to see themselves, from their realities to their aspirations, embedded in each purchase."

Meanwhile, one in three senior marketing decision-makers surveyed by the CMO Council believed that "loyalty is more often based on the consistency of transactions rather than the lasting bond of allegiance."

Nearly 40 percent of respondents defined a loyal customer simply as someone who consistently purchases their products, or is enrolled in an awards program.

This metric can be misleading, as that might more easily equate to convenience than loyalty for many consumers. 

One major reason for the disconnect is that strategies regarding both brand experiences and customer engagement are often kept separate, making it more difficult than necessary to unify under a clear view of the customer. 

This results in seeing customers as targets rather than people, which means they might purchase your product, but wouldn’t care less if your brand disappeared, according to a recent study from Havas. 

One way to remedy the situation is to first recognize that the definition of loyalty extends beyond a relationship "predicated on savings, rewards or promotions," the CMO Council states.

Any solution would also require senior marketing executives to "take specific and intentional steps to actually lean in with emotion and not just schemes, promotions or gimmicks," in order to develop true emotional loyalty to the brand. 

Source:
Campaign US

Related Articles

Just Published

1 day ago

Agency Report Cards 2023: We grade 31 APAC networks

Campaign Asia-Pacific presents its 21st annual evaluation of APAC agency networks based on their 2023 business performance, innovation, creative output, awards, action on DEI and sustainability, and leadership.

1 day ago

OpenAI inks multi-year content deal with News Corp

The five-year agreement comes as Microsoft, OpenAI, and Google face intense scrutiny over training AI models on copyrighted content usage without consent.

1 day ago

Agency Report Card 2023: Initiative

Losing long-term client Carlsberg is a blow for the agency, and Initiative has tried to mitigate the losses with solid employee initiatives.

1 day ago

Global indie media rankings: PMG and Cossette lead ...

Big single wins for Australia's Nunn Media and Howatson+Co helped them place 3rd and 11th respectively.