Loyalty is not a program. What is loyalty?
It’s a mission of mine to help brands realise the value of customer loyalty as an outcome.
To achieve this, I believe we need to first understand what loyalty is - beyond enrolling in a loyalty program.
Why? When you have clarity and alignment in your business on what loyalty to your brand/business is, you will then have the power to influence it for profitable business growth.
For the past 4 years, I have been researching loyalty to a brand/business from a consumer’s point of view (beyond enrolling in a loyalty program) in our benchmark loyalty research study For Love or MoneyTM.
In each study, 11 dimensions of loyalty to a brand/business are identified and provided to consumers to determine a ranking of what they believe loyalty is.
Tracking these results, I have determined a definition of loyalty to a brand/business:
Loyalty to a brand/business is both behaviour and belief.
Behaviour is a transactional connection identified by spending more and purchasing more often over the longer term. It’s about ‘money’.
Belief is an emotional connection where trust is inherent and personal recommendation is the proof. It’s about ‘love’.
Loyalty is never static nor does it exist in a vacuum of no competitors.
Ok, so now what?
The Loyalty Model and the Four Archetypes of Loyalty
As mentioned above, once you know what loyalty is, you can then determine by which dimension, your customers are ‘loyal’.
To help you, I have created the Loyalty Model and the Four Archetypes of Loyalty.
This is based on the X axis of Behaviour (money) and Y axis Belief (love).
Classify your customers into any of the Four Archetypes of Loyalty. They are described as:
Who are they: They represent ‘little love and little money’. They are the IDLES.
What’s the voice in their head saying about your brand/business: ‘Why should I care?’
The action to take: Move them toward ‘love’ and/ or ‘money’ or maybe ignore them. If apathy is the issue, then the question is - do they have the potential to be moved towards ‘love’ and/or ‘money’?
(How you do this is specific to your brand and the offering you provide your customers and is where the fun really begins!)
Who are they: They represent ‘Lots of love & little money’. They are the INFLUENCERS.
What’s the voice in their head saying about your brand/business: ‘my connection to the brand is more than money’.
The action to take: Reinforce the ‘love’ and slowly move them towards more money. NOTE: These customers are your advocates and are referring new clients/customers to your brand or business, generating money in a different way.
Who are they: They represent ‘little love & lots of money’. They are the DEALS.
What’s the voice in their head saying about your brand/business: ‘it’s worthwhile being connected to the brand/business’
The action to take: Maintain the money (they are valuable) and work on creating more emotional connections so ‘love’ grows.
Who are they: They represent ‘lots of love & lots of money’. They are the IDEALS.
What’s the voice in their head saying about your brand/business: ‘I love the brand and its worthwhile being connected to the brand/business’
The action to take: Maintain the love and the money. They are valuable in both revenue and referrals.
I have not provided any specific examples or detailed actions in this model as this will depend on many factors, however, I believe that once you know where your customers are in the Four Archetypes of Loyalty, you can then develop the strategies and actions to influence their loyalty to your brand/business.
In summary, consider the following steps
- Determine what loyalty to YOUR brand/business is? (we have helped brands do this)
- Classify your customers into Four Archetypes of Loyalty (you can use this model or tailor your own)
- Determine the strategies and actions to take to influence their loyalty to your brand/business (unique to your brand and your customers)
I hope this Loyalty Model helps your brand take action to build customer loyalty over the longer term.
Please let me know your feedback.