NORFOLK, Va. — Researchers at Old Dominion University’s Loyalty Science Lab are diving into the complex world of brand loyalty.
To better understand what makes a customer loyal and where business models are headed, they published The Future of Loyalty Report.
“It’s a good time to look back, as well as look forward, to see where loyalty is going to be headed as consumers' lives go into the new normal kind of space,” said Yuping Liu-Thompkins, a marketing professor and the Director of the Loyalty Science Lab.
She said during the pandemic, a lot of people started switching brands.
“Our research also shows that people are stressed out, and one of the ways to deal with that stress is to buy a new thing [in an effort to] try a new thing and regain control of our life,” she said.
But what about customers who stayed true? Why did they choose to stay on brand?
For people who are 55 and older, Liu-Thompkins said the research points to a few things.
“Product, price, and customer service components are really the core of how they make their loyalty decisions,” she said.
The younger generation, her study found, cares more about shared values and company culture when selecting brands to be loyal to.
“When we look at the, maybe 35 and below consumers, [the percentage of those who say they choose a company for value alignment] jumps to 75-80%, roughly in that range,” she said.
Understanding these patterns is the reason for the report in the first place – to give companies an inside look into consumers’ minds.
Liu-Thompkins said analyzing these patterns can help owners shape their business model to meet their target audience and explain how their decisions can impact income. The report highlights how consumers in different generations react to everything from the way they treat their employees to how their employees treat customers.
“It’s no longer just going to be the product or the price,” she said. “You actually kind of need to understand a little bit more, not just about your loyalty metric, but loyalty from the consumer's point of view.”
When it comes to rewards programs, she said younger consumers are more impacted and enticed by them than older consumers. In fact, 84% of people between 18 and 34 said reward programs make them buy more, compared to 51% of people 55 and older.
The Future of Loyalty Report surveyed more than 1,000 people from four countries.
Click here to read the report for yourself.
