Maximize loyalty insights for better customer relationships

Customer loyalty is complex, especially in the highly competitive consumer packaged goods (CPG) space. Understanding what makes — and keeps — shoppers loyal to your brand is an ever-changing endeavor that’s affected by a variety of factors in our rapidly evolving world.

To build customer relationships that last, brands must stay close to shoppers by identifying not only how they define loyalty, but also what factors influence it and which categories it affects the most. Loyalty insights are an essential part of achieving those objectives. Ongoing loyalty research can help brands develop strong customer retention strategies to provide an optimal customer experience that keeps shoppers buying your brand and reduces opportunities for them to switch to a competitor’s.

A recent brand loyalty report from 84.51° found that shoppers have higher loyalty to brands in certain grocery and household items categories versus others. Shoppers said that in the past year, they have grown increasingly loyal to their preferred brands in the milk, juice, yogurt and egg categories. But preferred brand loyalty growth was much lower in cereal, vitamins and oral hygiene products.

To better understand and act upon such shifts in brand loyalty, brands should closely analyze their performance in key drivers of brand choice, and consider monitoring via quarterly pulses to ensure they are delivering value and increasing engagement.

Our research also found that price is not the only driver when shoppers are deciding where their loyalty lies. Although price is an important factor — especially in the face of pinched budgets caused by recent global events — quality, brand trust and other factors shape loyalty, too. When asked which factors are most important in informing their decision on what grocery and household item brands to buy, top priorities included that the brand “is a brand I trust,” “comes in the varieties/sizes I want” and “delivers on its promise.”

With these insights in mind, brands cannot assume that undercutting competitors on price is the answer. It’s important to look beyond price to these other priorities. To help ensure product performance is meeting these shopper expectations, brands can utilize product performance claims testing or product usage testing. Insights gleaned from that testing can also inform loyalty programs that differentiate brands from the competition.

While today’s customers have varying definitions of “loyalty,” in most shoppers’ minds, it has shifted away from exclusivity. That means shopper loyalty no longer guarantees brand purchases. Our research found that only 5% of shoppers defined brand loyalty as only buying that brand and nothing else. But many customers exhibit repeat purchase habits without strong brand loyalty: 27% said being loyal to a brand means it’s the brand they buy most often, and 26% defined it as having a preferred brand but being willing to try other brands.

With the majority of shoppers being willing to try other brands, CPGs must continuously work to earn shopper dedication and differentiate themselves in a highly competitive space. Disrupting shopper routines with new products and offers can drive renewed customer interest and inspire loyalty. In-depth shopper research can help determine whether current products are meeting shopper needs, and also uncover unmet needs that present opportunities for innovation.

CPG loyalty is complex and evolving. It requires continuous insights to keep up with shifting consumer attitudes and behaviors. These tips offer a glimpse into what brands should consider, and also illustrate the need to stay close to shoppers.

Ongoing loyalty research is key for CPG brands to drive growth. For the latest insights about brand loyalty and how to earn it in a constantly changing environment, read our new white paper, The loyalty shift decoded: Key insights for winning customer devotion in an uncertain economy.

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