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Michelle Bitran
Blog Manager @ Yotpo
September 17th, 2018

The State of Customer Loyalty in 2018

How do American shoppers feel about brand loyalty?

Table Of Contents

As Amazon’s rise continues to influence consumer expectations (did someone say 48-hour shipping?), today’s brands are having to go above and beyond to create experiences that foster customer loyalty. At the same time, climbing customer acquisition costs are making retention and customer lifetime value increasingly critical for eCommerce success.

In this post, you’ll find select results from our national survey on American shoppers’ attitudes towards customer loyalty in 2018, revealing:

  • What it takes for customers to become brand loyal
  • What sends even the most loyal customers into the hands of the competition
  • How loyal customers express their appreciation
  • And more!

On the whole, the trend towards customer loyalty is encouraging, with 90.2% of shoppers saying they are equally or more brand loyal than a year ago.

Are Consumers Becoming More Brand Loyal?

What makes a customer loyal?

Despite the growing importance of customer experience, product is still both the point of entry and departure for brand loyalty. 55.3% of consumers are brand loyal because they love the product, and poor product quality is the number one reason why a brand would lose a loyal customer (51.3%). This echoes the success of modern direct-to-consumer brands that rose to fame thanks to “hero products,” including UNTUCKit, Quip, and Away Travel.

Second to poor product, sub-par customer service will drive away 23.5% of loyal customers, meaning that even for brands with ground-breaking products, the surrounding experience is still paramount.

What Makes Consumers Loyal to a Brand?

How many repeat purchases does it take to build loyalty?

The survey further revealed that the bar for brand loyalty is high — a repeat purchase or two doesn’t mean you have a new brand fan. In fact, 37% of consumers say that it takes five or more purchases for them to consider themselves loyal to a brand.

Bringing back a customer five times is no small feat as consumer demands grow: 67.3% of shoppers expect 24/7 customer service, while 71.0%  anticipate more frequent discounting and 58.4% seek out free shipping in exchange for their loyalty.

How Many Purchases Does it Take to Be Brand Loyal?

Why loyal customers are worth the effort

Still, the work involved in earning and retaining a loyal customer pays dividends. Some 60% of these customers will share their favorite brands with friends and family. You can’t beat that kind of word-of-mouth marketing, especially since referred shoppers come to your site with a pre-established level of trust.

Additionally, 52.3% of loyal customers will join a rewards program, and 39.4% will spend more on a product even if there are cheaper options elsewhere. That kind of price-blind dedication is invaluable in the hyper-competitive modern eCommerce space.

What Do Customers Do For Brands They Love?

Conclusion

Customer loyalty is more important than ever, but consumer expectations are ballooning as online competition grows. In order to thrive, brands need to not only meet those expectations but develop a deeper understanding of their customers and seek out opportunities to add value to their experiences.

To build loyalty among a wider customer base, brands should pay close attention to the behaviors and attitudes of their best customers with two objectives in mind:

  1. Find meaningful ways to reward those customers, so they keep coming back.
  2. Uncover the experiences that resonated with top customers and enhance them as a strategy to win over new shoppers.

 

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