Rewarding Customers for Brand Loyalty

“Loyalty cannot be blueprinted. It cannot be produced on an assembly line. In fact, it cannot be manufactured at all, for its origin is the human heart-the center of self-respect and human dignity. It is a force which leaps into being only when conditions are exactly right for it-and it is a force very sensitive to betrayal.” – Maurice Franks

Brand loyalty, though ephemeral, is present around us all the time. Loyal and happy customers ‘advertise’ their favourite brand through social media, proudly using the products of the brand, and other such expressions of brand loyalty. As mentioned, several times, existing happy customers are the best and most potent brand ambassadors of a company – leaving behind all other forms of promotions and advertisements. The two-fold immense benefits for a company is that customers are happy to flaunt their connection with a brand / company, leading to interest and awareness in a much larger potential customer base. It makes sense for companies then to put in place for nurturing, encouraging, and rewarding customers for brand loyalty. As we said at the start of this exposition, brand loyalty is transient given the choices customers now have, and without consistent efforts, no company would be able to hold on to it.

The first thing that comes to mind for rewarding customers for brand loyalty, is loyalty programs – to retain these loyal customers and attract new ones by showing them the potential gains in associating with the company. Research and reports reveal that at least 27% customers are willing to sign up for a company’s loyalty program and companies generate around 60% of their earnings through such programs. Seems like good business sense to put together rewards for such customers. However, some further studies have concluded that sometimes loyalty programs do not serve their purpose – that is to increase sales and profits for a company. Despite these programs, the users may still not end up spending enough to ensure that a company breaks even. Hence, while a company may be using its resources and making investments, to support the loyalty program, the ROI may not be worthwhile over time. The premise behind rewarding customers for brand loyalty should be rather to focus on building long-term and profitable relationships with customers, rather than enticing them short-term with freebies.

A company, in rewarding customers for brand loyalty, must show them appreciation for their business and the fact that these customers dedicatedly use and endorse the brand. Companies must constantly endeavour to provide enhanced customer experiences, and ensure that these customers feel valued through top class service. These customers have already proved that they love the brand and the products and hence their ‘treatment’ must be different as compared to first time buyers / new customers. The prospective customers need enticements in the form of freebies and incentives to ensure they become interested enough to buy. The loyal customers on the other hand, would have been with the company for a long-time, repeatedly spending their hard-earned money and investing time in the ‘relationship’, therefore they deserve red carpet treatment at all times and through every single interaction. In fact, companies must express their appreciation in different ways and constantly seek to delight these loyal customers.

We have mentioned several times, and anyone in business would know that loyalty equals trust. Trust is possibly the hardest asset to attain, but the easiest to lose, and takes almost forever to re-build (sometimes impossible). A business / brand / company that is able to gain the trust of customers are possibly the ones poised for long-term success – if they are able to keep it. For loyal customers, trust is what makes them repeatedly use a brand, speak highly of it, and encourage others to use it too. However, trust is never a given nor is it built through a one-off effort. It takes time, dedication, and consistent effort and it would be in the best interest of a company to sustain it through whatever means possible. The fact is that it is human nature to trust – and since a lot of buying decisions surround emotional reasons this would be a key factor when associating with a company long-term. By consistently providing top class service, high quality products, and surprising customers in various ways, a company would be able to gain and retain their trust, using it to advantage to make their business a success.

According to a study, customers would let about nine other people know when they have a great experience with a brand, but will tell at least 16 others about the poor experiences. This kind of negative publicity ends very badly for companies. Companies then must ensure that not only should they provide top class experiences for their customers, they must put in place a system for rewarding customers for brand loyalty, such that they remain encouraged to speak only good things about the company. With the rise of social media, thousands of people can possibly view comments from loyal customers (and comments from angry ones) at any given time – a much wider reach and audience than a company could have ever thought possible.  With so many advantages of keeping customers happy and loyal, it would seem counter-intuitive for companies to provide the best of products and service to their customers. While it would be near impossible for a company to control every interaction with its brand, it can ensure that most interactions are pleasant and it is able to take full advantage of them.

Another great way of building relationships and rewarding customers for brand loyalty is by organization events. Not only do events enable people to have a better opinion and more awareness of a brand, it allows your best customers to interact with like-minded people, promote their business, and gain benefits for their company – its free advertisement and promotion for them, which they would reciprocate by further endorsing and referring your company. For a company, events have several benefits. For one, they put a company in touch with several different market players, who could end up becoming customers. Secondly, it helps the company to understand the ‘psyche’ of the market and gain valuable insights about customer behaviour and preferences. In addition, events are a great way to create a buzz around any planned products or initiatives – gaining awareness and stoking the curiosity of the visitors. Large and well-organized events also gain from media interest – such events covered by the media get even more publicity for the organizing company and the major attendees – a win-win situation for the company and its loyal customers.

The great part of putting together initiatives, such as events, is that not only does a company come to the forefront at the time of the event, a meticulously implemented one ensures that the visitors remember the company in the future too. Even if those attending may not have use of the company’s products or services at the time of the event, they would be sure to recommend it to others who may need it, and or call upon the company when they do need its offerings. The fact is that such events and programs, allow for face-to-face human interactions that customers love and crave for – it is easier for them to trust a company whose human side they can ‘see’. Statistics reveal that at least 57% businesses accepted that they were able to build long-term loyal relationships with their customers and drive repeat business through such ‘personal’ interactions.

Rewarding customers for brand loyalty is not simply a factor of putting together mundane and similar loyalty programs. It is about incentivizing the loyal customers in several ways, delighting them at every step of their ‘journey’ with the company, and overall making them feel highly valued and important.

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