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2 April 2013

Stand by your brand?

I will love and honor you all the days of my life. Is 100% brand loyalty still possible nowadays or should we rather talk about divided loyalty to a group of brands? Does a steady marriage between brands and customers remain a Utopia?


The Yearly Marketing Survey 2013 reveals that marketers are wasting time and money on ineffective loyalty tactics. Well-known reward programs with incentives and gifts don’t work anymore. Using a points system in which each point can be redeemed has become a commodity. Marketers should really rethink the loyalty concept. Do points and loyalty cards truly make customers loyal?

Commoditization explains why making products and services more relevant and improving the customer experience have the highest success rate. This indicates that marketers should disconnect loyalty from purchases and analyze customer needs better. But aren’t these the basics of marketing? Shouldn’t we apply these general rules, not only to retention and development, but also to the acquisition of new customers?

The myth “It costs five times more to acquire a customer than to retain one” is already outdated. The combination of a penetration strategy and loyalty approach might prove more profitable for brand growth. Marketers should decide whether they target light users, loyal purchasers or both. The survey indicates that marketers consider focusing on customers with the highest customer lifetime value to be successful. But they risk ignoring customers who could turn into more heavy purchasers in the future. This puts a mortgage on marketers’ chances of obtaining increased sales volume and brand growth and, over the long term, loyalty.

Marketers better come up with an innovative concept to increase customer engagement and combine it with a clear penetration strategy. But what do you think? Brand loyalty: dying a slow death or … until death do us part?.