Brand Loyalty: What Is It & Why Does It Matter?

Have you ever been to the supermarket and chosen a specific soft drink or cereal, even though other brands are cheaper?

That’s brand loyalty in action!

By showing customers that your brand is trustworthy, committed to customer care, and aligned with their values, you can reap the benefits.

Eighty-two percent of shoppers want to buy from brands whose values are the same as theirs and 34 percent will pay up to a quarter more to do so. 

In this post, I’ll explain what brand loyalty is, how to measure it, and how to build brand loyalty into your digital marketing strategy.

Key Takeaways

• Brand loyalty is when customers always choose your product or service regardless of cost or competition. By cultivating brand loyalty, you can ensure customers continue to buy from you and recommend you to others.
• All businesses can establish a strong, well-thought-out approach to brand loyalty, regardless of size or industry.
• Customer lifetime value (CLV) is the most effective metric for measuring brand loyalty. If your CLV drops, this could be a sign of an issue that harms loyalty. 
• It’s essential to know your target audience and understand what they value the most. You can then create content that appeals to them and shows you’re an authentic and reliable choice.

Table of Contents

• Key Takeaways
• What Is Brand Loyalty and Why Is It Important?
  • Brand Loyalty vs Customer Loyalty
• Customer Lifetime Value and Why It Matters
• How to Build Brand Loyalty with Digital Marketing
  • 1. Know Your Audience Needs
  • 2. Provide Effective, Actionable Content
  • 3. Define a Brand Voice and Story
  • 4. Mine Social Media for Insights
  • 5. Personalization
  • 6. Influencers and Thought Leadership
• Examples of Brand Loyalty Success
  • Example 1: Patagonia
  • Example 2: Rhode
  • Example 3: Keyzoo
• FAQs
• Conclusion

What Is Brand Loyalty and Why Is It Important?

Brand loyalty is when customers always choose a specific brand, even when the competing brand is more affordable or offers additional benefits.

For example, let’s say you always pick Coca-Cola over Pepsi. You might choose Coca-Cola because you like how it tastes, you enjoy the TV ads, or it reminds you of good times with your friends. 

All these factors contribute to brand loyalty.

The main benefit of brand loyalty for businesses is that it means more sales over a longer time. It also means customers are less likely to be swayed by your competitor’s marketing and may even encourage other people to try your brand.

Brand loyalty means you always have a collective of “die-hard fans” of your product or service who will continue to buy even if you raise your prices or change your marketing strategy.

Transparency and trust are at the heart of brand loyalty. “Brand loyalty comes from an emotional connection with your brand. Implementing personalized content strategies and engaging with your customers across various channels can help build deeper connections and encourage repeat interactions,” says Nichole Wiza, Senior Content Production Lead at NP Digital.

Brand Loyalty vs Customer Loyalty

Some people use the terms brand loyalty and customer loyalty interchangeably, but they’re slightly different.

Customer loyalty is all about encouraging customers to make repeat purchases. For example, by offering brand loyalty programs or showcasing the benefits your products provide.

Brand loyalty is all about forging a strong emotional connection with customers and encouraging them to identify with your values and purpose.

You can use both to encourage customers to buy your products and advocate for your business. 

Take Apple, for example. Apple offers a wide range of products that work together to provide a smooth and seamless experience. 

However, it also has a strong brand identity with design and innovation at the center. As a result, people are willing to pay more for Apple products and advocate for others to use them.

Customer Lifetime Value and Why It Matters

Customer lifetime value (CLV) measures how much a customer spends during their relationship with your business.

You measure CLV by multiplying average order value (AOV), purchase frequency rate, and average customer lifetime.

CLV is one of the most important metrics for measuring brand loyalty. A high number shows that you’re successfully building relationships and providing value to customers. 

A low number is a sign that you’re making errors that are driving customers away. For example, not listening to customer feedback or offering an inconsistent experience across marketing channels.

You can also segment CLV by digital marketing channel to see which are most effective for customer retention.

How to Build Brand Loyalty with Digital Marketing

One of the most effective ways to build brand loyalty is through digital marketing. 

You have a wide range of data at your fingertips that you can use to understand your target customers. You can also utilize different types of content to appeal to customers, whether they’re on social media or keeping up with your company emails.

Here’s how to build brand loyalty into your digital marketing strategy.

1. Know Your Audience Needs

You start building brand loyalty by first understanding your target audience. By target audience, I mean the people you want to buy your products or services. 

It’s important to know what your target audience values most so you can showcase these values through your marketing.

For example, if sustainability is important to your customers, you can promote what you are doing to make the world a greener place through your marketing.

Some of the values that are most important to Coca-Cola (and therefore most important to its target customers) are quality, passion, and integrity. These values give Coca-Cola a clear steer as to which marketing messages to prioritize.

2. Provide Effective, Actionable Content

Content marketing helps you to promote your values and connect with your customers. When creating content that encourages brand loyalty, remember to prioritize your audience’s needs over your sales message.

Your content needs to be:

• Consistent. Establish a cadence to make sure your customers can’t wait for your next piece of content.
• Well-researched. Understand which content your target audience wants to see and deliver it on the platforms they use most.
• High-quality. Take the time to create informative, educational, and entertaining content.
• Relevant. You want your content to address your target audience’s needs and pain points.
• Engaging. Use storytelling to appeal to your customers and appeal to their emotional needs.
• Trustworthy. Utilize the E-E-A-T framework to show customers why you’re the right choice.

Don’t forget that your own customers can be a rich source of content. “Incorporating customer stories or user-generated content (UGC) into your content strategy showcases authenticity and fosters a sense of community around your brand,” says Wiza.

3. Define a Brand Voice and Story

As well as understanding what type of content you will create, you need to decide what your brand voice will be. 

What personality will you showcase to customers? Will you be fun and playful, or professional and authoritative?

Your brand voice must be consistent across different channels. This puts customers at ease, allows them to recognize you in a crowded marketplace, and, most importantly, gives them reason to trust you.

Let your values guide you – if your primary goal is to make the world a friendlier, happier place, reflect that in your brand voice.

4. Mine Social Media for Insights

Social proof like testimonials, reviews, and UGC can help establish trust in your business and encourage more customers to buy from you. 

Customer satisfaction is a key driver of repeat business, and reviews help you identify the customers most likely to become loyal advocates for your brand.

An easy way to find social proof is on social media. By encouraging customers to post on your account, mention your brand, and use your hashtags, you can source valuable social proof.

Social media is also a fantastic way to see what customers (and prospective customers) say about your brand. Social listening tools like Mention and Hootsuite let you monitor social media mentions, gather feedback, and respond to people, even if they didn’t explicitly mentioned you.

5. Personalization

Personalizing your digital marketing can grow customer confidence and encourage them to buy more. 

According to Deloitte, 71 percent of marketers leveraging personalization report improved customer loyalty and 67 percent report more regular purchasing.

One of the easiest ways to use personalization is through email marketing. You can appeal to specific groups of customers by sending tailored email campaigns and segmenting your audiences based on their interests or behaviors. 

For example, you can identify your most frequent customers and send them exclusive content like early access to new product launches and invites to VIP events.

6. Influencers and Thought Leadership

Over 70 percent of customers will buy more from brands they trust. The issue? Only 30 percent of customers express “high trust” in companies.

You can increase levels of trust and cultivate brand loyalty by establishing yourself as a source of knowledge in your industry. One of the ways I promote myself as a thought leader in digital marketing is by guest posting on sites like Forbes and Adweek. I also frequently host free workshops and webinars to share my experience and train other marketers.

Another way to build trust is to strategically partner with influencers that your customers trust. According to Sprout Social, 53 percent of customers follow influencers who align with their values. An influencer collaboration could position your brand values front and center, expanding your audience loyalty and reaching potential new customers. 

Examples of Brand Loyalty Success

Here are some real-life examples of brands that have built strong brand loyalty and how they achieved it.

Example 1: Patagonia

A big reason why outdoor clothing brand Patagonia is so memorable and distinctive is because brand values are at the center of company actions. 

Sustainability and activism are important to both Patagonia and its customers, and the brand offers a wide range of resources to help shoppers become more eco-friendly.

Patagonia doesn’t pay lip service to sustainability. It shows how it’s actively making changes and invests its profits into nature and biodiversity causes. 

Example 2: Rhode

Haley Bieber’s makeup brand, Rhode, cultivates brand loyalty through social media, with a strong presence on Instagram, YouTube, and TikTok. The brand shares expert tips as well as photos and videos by influencers.

Rhode is also well known for responding to feedback. After a beauty influencer criticized Rhode for a lack of inclusive makeup shades, Bieber personally reached out to her to resolve the issue.

By doing this, Rhode showed customers it values their opinions, making them more likely to make repeat purchases and become brand advocates.

Example 3: Keyzoo

Building brand loyalty isn’t just for large businesses – smaller companies can do it too!

Keyzoo, a U.S. locksmith company, builds brand loyalty by sponsoring regional events and offering free lock maintenance workshops at community centers. This encourages trust and familiarity at a local level.

The business also implemented a loyalty program, sending customers personalized keychains at specific milestones – a great way for customers to introduce the brand to others. 

FAQs

What is brand loyalty?

Brand loyalty is when customers consistently buy a particular brand because they trust or have an emotional connection to it.

What are examples of brand loyalty?

There are lots of brands well-known for cultivating brand loyalty including Apple, Nike, Starbucks, and Coca-Cola. Any business can use brand loyalty to build connections with customers, regardless of size or the sector they operate in.

How do you build brand loyalty?

You can build brand loyalty by:

Showing customers that you’re a trusted and reliable voice of experience.

Understanding your target audience and what is most important to them.

Developing a consistent, authentic brand voice that stands out in the marketplace.

Creating personalized content that resonates with the needs and values of your customers.

Using social media to respond to customers and gather valuable feedback.

Conclusion

Successful brand loyalty is about making every customer feel like a VIP. Provide value in every interaction and your customers will choose your brand more and more.

Brand loyalty pays. 

Loyal customers are more likely to spend more money with you, and they’re more likely to suggest your brand to others. Half of U.S. consumers show loyalty to a brand by recommending it to friends or family.

If you’re looking for increased revenue and greater customer lifetime value, implement the strategies above to start cultivating brand loyalty with your customers.