The Secret to Brand Loyalty

If you want your customers to stay loyal, make them a top priority

Back Web Only Mar 30, 2016 By MaryJayne Zemer

There are some brands that have no substitute. Brands we stand in line for, pay more for, travel farther to get, and think of as a category all their own: the likes of Tiffany’s, Tesla, Legos, Patagonia, Airbnb, Apple, Prana, Starbucks, American Express.

And then there are brands we buy and use out of familiarity, convenience, affordability and plain old habit. Brands we buy all the time, maybe even for a long time, but have no true loyalty to. Our buying habit could be easily broken, swayed by the spur-of-the-moment decision, cheaper price or more interesting option.

The real secret to brand loyalty: Customers are loyal to brands that are loyal to them. True brand loyalty isn’t bought — it’s earned one customer experience at a time.

Take, for example, American Express, which consistently ranks among the world’s most valuable brands (due in no small part to the fact that brand valuations are directly correlated to brand loyalty) and is the world’s largest credit card issuer by purchase volume.

If you’re an AMEX cardholder and your purse or wallet is stolen while you’re traveling abroad, American Express has your back. The American Express team will send a courier to your current location, with up to the full cash-advance limit on your card to ensure you have access to cash while traveling. They also offers free passport and immediate card replacement services, turning a potential vacation-ending nightmare into a fairly seamless process.  

American Express’ purpose is to make “it easier, safer and more rewarding for consumers and businesses to purchase the things they need.” “Don’t leave home without it” and “Membership has its Privileges” aren’t just slogans — they’re catchy, sticky articulations of AMEX’s’ brand purpose and customer experience. This customer experience differentiates American Express from its competition (competition that’s accepted more places, doesn’t have annual fees) and earns the loyalty of their customers —one replacement passport and averted emergency at a time.

Brand equity measures how loyal a brand’s customers are, how familiar and recognizable the brand is, and how much sway a particular brand has over customers’ decision-making process and shopping habits. In addition to indicating whether customers are truly loyal, brand equity plays an enormous role in determining a brand’s valuation — the monetary value placed on brand as an intangible business asset. Apple came in first place in Forbes’ annual list of The Most Valuable Brands of 2015 with a brand valuation of $145 billion dollars, a 17 percent increase since 2014.  

Starbucks ranks No. 55. Much like American Express, the coffee company’s loyalty program is rooted in value and brand experience rather than discounts. Starbucks is one of those brands we wait in line for, and while waiting in line for an early morning caffeine fix, most people tend to tune into their phones to check their email, Facebook and Instagram. Starbucks baristas realized that customers had to set their phones down in order to pay for their coffee once they approached the counter and had to fumble through their purse or juggle keys and a phone to dig out their wallets. Starbucks’ designed its loyalty rewards app to solve this minor morning inconvenience by allowing patrons to pay for their purchases simply and easily, without a wallet.

In their book, The Brand Bubble: The Looming Crisis in Brand Value and How to Avoid It, Edward Lebar and John Gerzema identify purpose, authenticity and relevance as the three primary factors that influence customers’ trust and loyalty. While brand valuations have steadily increased, trust in brands has been in decline. About 62 percent of Americans believe corruption is widespread across corporate America, and trust is low in corporations and well-known brands. “When consumers stop respecting and trusting brands, their loyalty diminishes and they either stop buying or expect incentives such as price discounts to recapture their loyalty,” Lebar and Gerzema write.

Customers may trust fewer and fewer brands than ever before, but they still maintain deep loyalties to a handful of brands — make sure your brand is one of them.


Ellen (not verified)April 9, 2016 - 8:07am

Interesting article! It makes me wonder if furthering share shifting opportunies within hotel brands? Possible hotel brand- competitors to Amex offer perks through reward programs that are difficult to break despite high service.