Organisations must look beyond the traditional low price and reliable service factors to drive customer loyalty in today’s digital age, according to an Accenture Strategy report.
Accenture Strategy’s Seeing beyond the loyalty illusion: it’s time you invest more wise report found that organisations are wasting billions of dollars each year on customer loyalty programmes that don’t work like they used to. The report showed that 54% of US consumers have switched provider in the past year, and almost one fifth said their expectations around brand loyalty have completely changed.
“New ‘languages of loyalty’ have emerged, driven by brands experimenting with creative digital experiences, which have changed the dynamics of customer loyalty today,” said Robert Wollan, senior managing director and global lead of Advanced Customer Strategy at Accenture Strategy. “With 66% of US consumers spending more with the brands they love, organisations that stick to traditional approaches and don’t explore the new drivers influencing loyalty risk draining profitability and pushing customers away – even when they have the best intentions or are following their historical playbook. It’s time for organisations to take a fresh look at loyalty.”
Accenture Strategy has identified five ‘languages of loyalty’ that are driving customer relationships in the digital age, particularly among U.S. millennials.
The first is ‘tokens of affection’. According to the survey, 59% of US consumers feel loyal to brands that present them with personalised discounts, gift cards and special offers to reward their loyalty.
Around 41% of US consumers are more likely to shop with companies that offer them the opportunity to personalise products, while just over half are loyal to brands that interact with them through their preferred communication channels. In addition, 81% feel loyal to brands that are there when they need them, but otherwise respect their time and leave them alone. Furthermore, 85% prefer brands that safeguard their personal information.
Actively engaging with customers to design or co-create new products is another way to boosting loyalty. Almost half (45%) of consumers value brands who do this, while 41% like organisations that present them with new experiences, products or services. A further 33% are loyal to brands that engage them in multi-sensory experiences, using new technologies such as virtual or augmented reality.
Partnering with influential people also has an impact on brand loyalty. In total, 23% of consumers are loyal to brands that partner with celebrities and another 23% favour organisations that work with social influencers, such as bloggers and vloggers. Similarly, 37% stay with brands that actively support charities or public campaigns, and 42% remain loyal to companies their friends and families use.
Finally, brands should look to connect customers with other providers so they can enhance loyalty points and rewards. Almost 40% of survey respondents said they feel loyal to brands who do this, while 51% are loyal to brands that consistently offer the latest products and services.
“Organisations need to understand the loyalty languages of their most profitable customers and implement the optimal mix to ensure they’re delivering the experiences that drive advocacy, retention and growth,” said Kevin Quiring, managing director of Advanced Customer Strategy at Accenture Strategy. “An appetite for extraordinary, multi-sensory experiences, hyper-personalisation and co-creation, are changing consumer dynamics around loyalty and forcing brands and organizations to shift their approaches and programmes.”
Share this story