Customer loyalty

Customer loyalty can be defined as the process by which an emotional bond and trust is created between the consumer and the brand. This sort of conduct is conceived by the level of interest that a person has in gratifying the same need during the repeated purchase of the same product, a brand, or the periodic frequency in the same establishment. Brand loyalty is a measure of a consumer's level of attachment to a particular product, service or company. This happens when the company evoke positive emotions about their products or services, encouraging people to buy more and more often.

Jacoby and Chestnut describe brand loyalty as "a non-random behavioral response expressed by some decision unit over time in relation to one or more alternative brands, being a function of psychological decision and evaluation process". Loyalty occurs when there is a favorable correspondence between the individual´s attitude towards the organization and their purchasing behavior for its product and services. It is an ideal situation for both the company and the customer. By providing a positive and pleasant customer experience, the company manages to establish a bond of trust.

Building customer loyalty

Knowing how to build that customer loyalty is critical, as it helps the company to reduce customer acquisition costs and maximize return on investment. Markets currently work based on several factors, such as: economic, social, political, cultural, technological, demographic, etc. All this causes great difficulties in relation to the consumers to whom is directed. It is also important to add the environmental factors, such as competitors, suppliers and distributors, who work tirelessly to get the approval of consumers and thus be more profitable. Thanks to the current competition, products and services compete with each other to be leaders of the sector, using innovative strategies and with differentiating utensils and tools compared to the rest.

Due to the aforementioned competition in the markets, companies are forced to continually strive and improve trying to attract new customers by promoting new offers, improvements or processes so as not to lose their interest. It is universally acknowledged that clients are not as loyal as they used to since their preferences are constantly changing. This is one of the reasons why businesses invest on customer loyalty programs and create strategies to be better than their competitors in a sustainable way. For all this reasons companies are very conscious about their relationship between loyalty and fidelity: it is essential to know the tastes, motivations, desires and expectations of consumers and potential customers.

For organizations to achieve the task of retaining their customers, it is highly relevant that they incorporate loyalty management or fidelity, requiring specific market research activities that favor knowledge of needs, perceptions, motivations, desires and interests of customers. That the client remains in the company is due to an idea of value that is created in his mind such as: the product itself, the service and attention, the recognition of the brand, the reputation of the supplier, the variety of products. The company must take into account all these elements within the customer loyalty plan.

Customer loyalty is an ongoing process that the company must work on to achieve the desired results. Some tips to gain customer loyalty are:

• Keep the promises offered in the products or services. It helps to create a trusting bond with the customers.
• Create a community around the brand. A space for the consumers establishes an emotional bond with the products and services, sharing ideas, tips, etc.
• Offer flexible payment plans: for example, customers can pay for a product little by little through flexible monthly plans.
• Personalized treatment, creating unique experiences with the information the company knows about their customers.
• Continuous improvements. Obtaining insights from the customers will allow the company to make decisions about the products or services in a way that boosts customer loyalty.
• Design a loyalty program, recognizing the behavior of the consumers either with rewards or benefits or providing exclusive experiences that are related to the brand, as courses, activities, workshops, loyalty cards, discount cards, reward programs, etc.

Footnotes

Author: Zaira Bancells Guerrero, Mónica Guijarro Bernabeu, Gabriela Varela Barker