Three quarters of the US population believe businesses need to better encourage brand loyalty according to a new survey of 2,000 consumers.
Businesses have been encouraged to concentrate on maintaining customer relationships with rewards, social responsibility and personalized interaction. The study also revealed that loyalty to brands increases with age, as data highlighted that over 55’s are the most loyal and 18-24 year olds the least likely to stay with brands.
The survey investigating consumer habits was conducted by international telecommunications provider Toll Free Forwarding, and also asked respondents to share examples of the brands who have encouraged brand loyalty with them, by fostering good relationships. So what does the average consumer want in return for their loyalty, and what can businesses learn from it?
Response #1: “Brands should provide discounts and specials for customer loyalty. Or even just specials for all customers, say for certain periods of time as a customer appreciation type thing…”
Complacency is a problem when it comes to customer retention. Many business fall in to the trap of believing that the most important part of the customer journey from their perspective, is the initial sale. New sales can help drive growth, but to maintain a consistent and strong customer base, you have to develop positive relationships with your existing customers to ensure they don’t leave you for your competitor. One of the major factors cited by respondents in the survey was the offer of discounts and coupons as a reward to encourage loyalty. It might seem a bit old school but it’s evidently something that consumers still see as an important part of the relationship between themselves and brands.
Response #2: “I think they should respond to customers in a timely fashion. Especially on social media. I have had to reach out to brands that blocked me for a well put, courteous complaint. That's the worst. I think all brands should have a media presence to encourage loyalty.”
The power of interaction shouldn’t be minimized. While face-to-face interaction becomes less and less a part of the purchase journey, customers still want to know that there’s a real person there. There is now an increased expectation for interaction between consumers and brands throughout the process and especially after purchase. It’s now easier than ever to stay connected with your customers. The saturation of social media use has meant that all brands have recognised the need to use social channels, with 91% of US retail brands using two or more social media platforms. Now that brands are on social, they need to make sure they don’t neglect their online responsibilities. The only thing worse than not being on social media is not using it. Businesses should post regularly and respond to any customer queries as quick as possible.
Response #3: “I am loyal to some brands because of the values that they hold. I tend to choose companies that do not test on animals as well as being better for the environment.”
As well as sometimes failing to adequately support their customers throughout their journey, brands are often guilty of failing to recognize the bigger picture. Social responsibility is not just about charitable donations, but many consumers recognize the importance of having views aligned with the brands they buy from. This can be difficult when you’re a large business, but it’s increasingly important to consumers that they believe in the values of businesses they buy from. Brands should always consider the way they conduct their business. Customers will often appreciate brands who sell ethically produced products, e.g. free from animal testing. Being environmentally friendly is important too as worries about global warming continue to grow.
If brands want to keep their customers and maintain a profitable business, then they have to make every effort to keep customers engaged. The cost of getting a new customer varies but can cost up to 30 times as much as that of keeping an existing one, so retention should be the biggest priority for US business owners. Quick wins and new sales may drive quick growth, but a sustainable customer base will ensure businesses have a strong 2016.