Brand Loyalty is alive and well in 2018

Brand loyalty is the tendency for customers to favour one brand, consistently, above its rivals  for goods and services. Brand loyalty and customer retention are key for Marketers and for profitable growth in business. As a marketer you strive to attract new customers with higher brand visibility but unless these new customers stick around, you’re only going to see a short-term boost in sales. But is brand loyalty still common? Yes.  It began several decades ago, as consumers put their faith in specific brands to handle their needs in multiple categories —from cars to everyday groceries. But is the concept of brand loyalty dying? Have consumers lost the desire to remain loyal to individual brands? There is some evidence to suggest that brand loyalty is dying.  90% of common household goods brands are losing market-share in certain low-growth categories. And, logically, it makes sense that brand loyalty would be dying, for a number of reasons;

1 The internet.  This gives consumers access to brands from all over the world.

2 The changing nature of work. The landscape of work is also shifting; instead of working for one company your entire life, you’re more likely to make multiple career switches. Self -employment is now also more popular.

 3 Corporate distrust.  There is less trust of corporations than ever before. However, recent research undertaken by Facebook suggests that brand loyalty is alive and well. It surveyed 14,700 adults in the United States, examining patterns of behaviour across multiple different verticals. It found 77 percent of consumers have the tendency to return to their favourite brands over and over again. This 77 percent seem to be split into two main categories:

a. Brand Loyalists They make up 37 percent of the population. They make repeat purchases and are truly “loyal” to their favourite brands, meaning they would not switch given an opportunity like lower prices or more convenient access.

b.Repeat Purchasers                                                                                                     Make up the remaining 40 percent, and represent people who make purchases at the same brands, frequently, but only because they give them an optimal experience. Given lower prices or more convenience, they would have no problem switching brands.

Brand loyalty isn’t dead, but it has diversified. Brand loyalists are driven by emotions, at least to some degree, when going back to their favourite companies, while the repeat purchasers are driven solely by function. Obviously, the emotional ties are stronger and harder to break, but as long as you can appeal to both categories, you’ll be able to retain a hypothetical 77 percent of your customers.

It is interesting to see that the majority of the 77 percent are millennials (born 1981 to 1996). They are more loyal to brands. This is thanks, in part, to their interactions with brands on social media, and their high regard for company values, like corporate social responsibility.

Fergal Maher MBS (Mark.) Dip in Strategic Marketing, FMII Grad