Is Customer Loyalty Dead?

The world has evolved dramatically over the past several years. So have the dynamics of customer loyalty.

It’s understandable to feel that brand loyalty is literally on life support. A recent study by McKinsey found that nearly three-quarters of American consumers have switched brand preferences—many of them fueled by change driven by COVID-19.[1]  Empowered by such tools as the expediency and comparative shopping tools afforded by the Internet, customers now have the tools to be that much more fickle.

But, like Mark Twain quipped, reports of loyalty’s death have been greatly exaggerated. But businesses need to adapt to shifting dynamics of how best to develop relationships.

As marketing manager Tom Treanor points out in “Total Retail”, one way to look at loyalty is to subdivide it into two primary categories.[2] First is the more pragmatic functional.  This takes in the convenience with which a product or service may be obtained, price and other elements. That translates to easy to use websites—that incorporate consumer education elements—that are also easy to use, offer a wide range of competitive prices and responsive customer support.

The other category is the more subjective emotional. This covers the brand as a whole and, among other benefits, prompts consumers to take on the role of advocates, either through online reviews or personal recommendation.

It’s very much a subjective wild card, but one that needs to be addressed to bolster customer loyalty. Here are some ideas to do that:

  • Build personal relationships by going further. Even if there are less expensive options elsewhere, it’s harder to abandon a brand if you feel personally attached to it. One way to do so is to go above and beyond what a consumer might expect in terms of a personal touch. For example, pet supplies retailer Chewy sends handwritten holiday cards to all of its major customers in December. Needless to say, cards in handwritten form set the company apart from other retailers which settle for mass produced cards, fostering a singular sense of connection with customers.
  • Loyalty programs that go beyond the monetary. Loyalty programs are a proven tool to keep tabs on customer needs and to leverage the information collected to craft a personalized customer experience.  But don’t limit the perks to discounts and other financial incentives. Research shows that rewards programs can help strengthen customers’ affinity with a brand, often through experiential focused rewards. So rather than just offering discounts or promotions, consider including experiences such as sports tickets or access to proprietary content to help customers feel a stronger connection to your brand. Expedia, for example, offers members special deals on a list of  “bucket” trips by giving exclusive access to discounts on coveted vacation destinations.
  • Combat inflation. As prices keep rising, even the most loyal consumers can trim spending they simply feel they can’t afford. Don’t lose sight of the value of promotions, discounts, coupons, and flexible payment options. That can keep an aspect of functional connection—affordability—in play.

These are a sampling of strategies that can help strengthen loyalty. Many consumers now look at loyalty differently. You need to alter your approach to remain in their focus.


[1] Morris, Chris, “Brand loyalty is changing due to the pandemic”, Fortune, Oct.21, 2020.

[2] Treanor, Tom, “Is Brand Loyalty Dying?”, Total Retail, October 21, 2021.


Copyright (c) 2023 by Faisal Hoque. All rights reserved.

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