How are brands rethinking customer loyalty to strengthen ties with their communities?

Times are changing. In our relationship with brands, loyalty is no longer what it used to be. The consumer zaps. Good deals, information on available products, express delivery, payment methods: competition is strong in all directions, especially since price is no longer the final argument.

You have to admit that the pandemic was there. According to a YouGov America study conducted in May 2021, 61% of consumers worldwide say their customer service expectations are now higher than before the crisis began. In order to retain the consumer, it is now necessary to multiply the points of contact. Thanks to AI and resolutely omnichannel engagement, the customer experience becomes increasingly relevant and personalized. In addition to offering services, animating a community of consumers around strong values ​​then becomes a strategic marketing tool, but also an added value for brands, as explained in the white paper produced by PayPal (PayPal Think Forward “Rethinking Customer Loyalty”).

Engagement levers

If loyalty is not new in itself, it is more multifaceted than ever. In the United States, a study showed that, for almost 53% of respondents*, loyalty programs create a strong emotional bond with a brand. They were just 46% just 3 years ago. In addition to transactions, the consumer must therefore be engaged in their wake thanks to engagement levers, be it a community or social values. To remain authentic, loyalty must focus on emotion and not just transaction. Many consumers now prefer sustainable or ethical brands. A fact acquired among millennials and Generation Z, who are more than 25% in the world to consider the ecological footprint when making a purchase.

At a time when we are more concerned with customer retention than customer acquisition, 83% of respondents say that loyalty programs influence their decision to repeat a purchase from a brand. Clearly, loyalty isn’t measured in points: it’s now real value.

all subscribers

Today it is the signature that has the wind in its sails. Magazines of course, VOD service, but also a selection of good wines, pet food, clothes, organic cleaning products, nothing resists. So much so that its economy is expected to grow 18% by 2025. But beware, this is a volatile market, weakened by threatening inflation. In the UK, for example, households canceled 1.51 million VOD subscription services in the first quarter of 2022, up from 1.04 million in the previous quarter. The real difference is in the services and customer experience. Subscribing to the Amazon Prime VOD service is valued above all for express deliveries: subscribers also spend an average of four times more than non-subscribers. The big brands understood this well: now they are betting on this loyalty through subscription. At Carrefour, you can now choose the delivery frequency of your pre-selected basket. Swiss brand Cyclon has developed recyclable running shoes. Thanks to a monthly subscription, customers can exchange a used pair for a new one every six months. Note that this is not a forced marriage: the client should be able to disengage (and re-engage) easily without feeling trapped. If he leaves easily, he will come back more easily.

everything, immediately

Free, fast and punctual deliveries, not forgetting easy returns, are habits acquired with e-commerce. the mentality of everything, immediately knocks down the rules of logistics, a new competitive argument. Globally, 75% of shoppers are strongly influenced in their purchase decision by free shipping, for example. While 58% wait for the next day. The ultra-rapid still promotes the growth of players in fast-moving commerce, so much so that major brands are investing in this direction. Transparency about delays and additional costs, investments in the last mile, are the differentials in terms of durability and agility. However, the “returns” policy will also make a difference: PayPal recently offered the “Happy Returns” solution to US-based merchants with PayPal Checkout at no additional cost. They are delivery points that facilitate the return of the consumer. The purpose of this solution is to improve after-sales logic, an essential trend in e-commerce in 2022.

Many consumers are now more loyal to a service than a brand. To build a long and committed relationship, you must therefore analyze the customer experience and find all the obstacles and areas for improvement, and imagine additional services with a strong emotional dimension.

*All numbers quoted in the article are from the white paper “Rethinking Customer Loyalty”

To learn more and uncover the challenges of customer loyalty, download the “Rethinking Customer Loyalty” white paper offered by PayPal.

Content offered by Paypal

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