Brand loyalty is decreasing but its creation is still a good idea
Online, websites like Etsy provide an opportunity for small retailers and independent traders to differentiate themselves from Amazon, but the world of retail is perhaps best described as one of the competing monopolies. In the UK, Tesco, Sainsbury’s and Morrisons dominate London’s shopping street and represent the country’s only interests on Deloitte’s list of global retail powers. Tesco’s turnover is more than double that of Sainsbury’s.
This list of companies, which also Marks & Spencer in the top 100, it looks like an immutable thing. The UK had many of the same big names in its malls decades ago. And if brands like C&A and BHS have disappeared, it nevertheless shows how difficult it is to squeeze a new name into the public consciousness. Keeping him there is a whole different thing.
To make matters worse, many classic methods of customer retention are being phased out. Efforts to build brand loyalty, for example, have steadily declined for much of the past decade. Forbes, citing research by Verint Systems, indicated that two-thirds of customers switch from one brand to another for the sake of lower prices and better service. Convenience, rather than familiarity, is the new king.
While it’s true that a business doesn’t get anywhere without attracting new customers, just as important is keeping the old ones, a skill known in marketing circles as loyalty. Thus, the idea that brand loyalty is decreasing seems paradoxical. If a business cannot keep its customers, it cannot survive. However, this revolving door style of retail, where new customers inevitably leave, can be a necessary evil for the smaller store.
Very few companies can compete with Amazon – but there are many companies in the same niche. Unfortunately, picking up customers who can’t be served by Jeff Bezos’ goliath (or Walmart, Target, John Lewis, etc.) is a reality for even larger stores like Book deposit, which consistently matches its prices on Amazon – and then sells items for a dime less. However, fostering brand loyalty can be a more effective tactic than creative pricing.
Items like the Nectar Card and Holland & Barrett’s Rewards for Life program are good examples of loyalty programs, but they can be slow to accumulate points. Online rewards programs can be much more elaborate. For example, the Casushi online gambling website offers a loyalty bar that rewards users with points just for playing. These points, explained at https://www.casushi.com/, can then be exchanged for additional tickets on certain securities.
Marketing company Yotpo says 68% of those surveyed would join a loyalty program with a trusted brand. This establishes loyalty as a prerequisite for itself, which can be a tricky situation to deal with. Either way, there are some drawbacks to encouraging customers to stay loyal to your brand. Even uncompetitive pricing isn’t too much of a concern for people who just enjoy the experience of shopping at a favorite store.
Brand loyalty, although declining sharply in some areas, remains something that should be encouraged wherever possible.