Digital Marketing Glossary

Brand Loyalty

What Is Brand Loyalty?

Consumers are exposed to more than 6,000 advertisements a day. In many categories, buying options can be endless, making it more challenging than ever for brands to maintain high rates of customer retention. For this reason, companies need to focus on brand loyalty, a powerful tool for customer retention and long-term growth. Loyal customers will make repeat purchases because of trust and positive association with a brand. 77% of consumers report loyalty to specific brands for ten years or more. Increasing and prioritizing brand loyalty will become an undeniable necessity as more companies expand into e-commerce, where it’s easy for customers to discover new products or compare reviews, prices and shipping times.

Brand Loyalty vs. Customer Loyalty

Upon first glance, it may not be completely obvious what the difference between brand loyalty and customer loyalty is. While they are both equally important, there are some defining factors that brands should take into consideration. Customer loyalty refers to a brand’s connection and relationship with their customers, while brand loyalty usually relates to how a brand is perceived overall. This means that brands are consistently needing to find the balance between creating and maintaining a relationship with their existing consumers, while also focusing heavily on marketing strategy and promotion of their brand to new potential customers.

How To Build Brand Loyalty

Now that we’ve touched on the difference between brand loyalty and customer loyalty, it’s time to learn how exactly to create a positive perception of your brand that keeps customers coming back.

Loyalty Programs

Loyalty or rewards programs are one of the most widespread incentives marketers use to encourage repeat purchases. 74% of shoppers admit that working towards rewards points will make them more loyal to a particular brand. Rolling out rewards and benefits like sharing exclusive discount codes, surprise bonus points, or birthday freebies are great ways marketers can establish a personal connection with their customers.

First-Class Customer Service

Another effective way to improve retention and create brand advocates is by providing excellent customer service. Happy and satisfied customers will come back for more and are more likely to recommend your brand to others. At Dash Hudson, exceptional communication is the foundation of our customer success team. Automation systems with chat robots or voice-recorded messages have become all too common. Investing in a team of real people who specialize in high quality customer success ensures your customers get an authentic response that makes them feel valued and appreciated. Referrals and endorsements go a long way and positive customer service interaction encourages customers to recommend your brand to others.

The Long-Term Impact of Brand Loyalty

Brand loyalty is imperative to success for several reasons. Loyal customers will often go out of their way to continue their pattern of repeat purchases from your business. Loyal shoppers are willing to pay a higher price or are okay with minor inconveniences (like longer shipping time) because of their positive association and trust with the company. 

Brand loyalty can last a lifetime. This is common in tech, automotive, fashion, or consumer product industries. Shoppers can even pass down preferences for brands from one generation to the next. For example, a loyal customer won't think twice about buying the same type of laundry detergent for years because it's the brand their parents used.

Source: PR Newswire, Marketing Dive

The Future of Brand Loyalty

In recent years, consumers have significantly raised expectations for the brands they support. More buyers prefer companies to stand up for social issues and commit to causes that benefit the greater good, such as sustainability. 94% of consumers said they're more loyal to brands that offer complete transparency on subjects like manufacturing costs or diverse hiring practices. Transparency builds trust, which is the foundation of brand loyalty.

Additionally, consumers are four times more likely to favor and recommend businesses that use their social media platforms to advocate for social justice issues. However, businesses looking to build awareness by publicly committing to a cause must ensure they're doing so authentically. Speaking up about a cause without steps towards active support, for example financial donations, will make any previous statements ring hollow. Brands must strive to support causes that align with their company mission and values because 46 percent of Millennial and Gen Z consumers expect brands to speak up for social good.


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How can new companies establish brand loyalty?

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Brand awareness is the first step in creating brand loyalty. New companies looking to build a loyal customer base should focus on brand recognition strategies that allow consumers to keep the company and its unique selling point top of mind. This includes: creating valuable video content, maximizing organic social media strategy, and participating in brand partnerships.

How does social media affect brand loyalty?

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Social media marketing makes it easy for shoppers to follow, interact with, and discover brands. Statistics show that a majority of social media users follow at least one brand. Loyal customers are more likely to feel a personal connection with a brand when they consistently engage with a brand's content. Thanks to the growing popularity of social commerce, social media makes it easier for brands to convert followers to customers.

What can brands do to create brand loyalty with Gen Z?

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Brands marketing to Gen Z should focus on creating mutually beneficial relationships with these customers. Interactive marketing campaigns that do well with Gen Z include fun branded Snapchat filters or encourage user-generated content through hashtag campaigns or Instagram contests.

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