As we start out the third decade of the 21st century, the disruption levels in all aspects of the retail industry have never been higher. The old world is rapidly giving way to new and emerging ideas, while consumers are enjoying more and more power.
Never before have people had this much influence on what others will buy or use, which makes customer retention and loyalty more important than ever.
All the latest customer loyalty statistics, however, show that holding on to your existing customers while attracting new ones is becoming increasingly difficult. In an era of plentiful great choices, the quality of the product is becoming less and less impactful compared to the quality of customer service and user recommendations.
Here’s the deal:
The internet has allowed many businesses and products to become successful without ever investing into advertising. Instead, they rely on word-of-mouth recommendations. This is why established brands are starting to reward customers for their advocacy in addition to the traditional loyalty programs.
What this means is:
Customer actions, such as referring friends, sharing posts, and creating content are becoming more and more important to the brand itself.
To help paint a better picture of the current state of the relationship between the retail industry and its customers, we dug deep into the available statistics and research to bring you over 40 of the most incredible customer loyalty statistics in 2022.
The same research done by Emarsys lists organic search and paid search at spot two and three on the list, with social media trailing right behind. These statistics clearly show the true importance of keeping your business visible on the internet at all times.
The research shows existing customers are much more valuable than new prospects. In fact, loyalty statistics data proves that the probability of selling a product to a new customer stays at a low 5-20%,
Vilfredo Pareto’s 80/20 principle works amazingly well with sales and marketing, even a hundred years after its discovery. This means that, by studying the top 20% of your customers, you can work out how to attract similar people and increase your future profits.
This was the second most common answer, only below “Quick and easy checkout” in the same product loyalty research, which stood at a high 83%. Rewarding customers for their loyalty in a meaningful way should therefore be one of the top priorities of any business.
This correlates with a sharp increase in people’s openness to being observed. And it will lead to a completely new age of brand loyalty. Younger generations are increasingly willing to share more and more of their life with the world, and the trend doesn’t seem likely to slow down any time soon.
Loyalty program statistics and trends show how essential these services are for brands and businesses around the world. So much so that 77% of people are more likely to continue using a brand’s services if it has a loyalty program.
People are very interested in engaging with brands through Virtual Reality, Augmented Reality, chatbots, wearables, biometrics, and so on. This very much indicates that following the latest emerging technologies trends and integrating them with your brand can prove to be extremely valuable.
Adding features that are commonly found in games, like virtual rewards and goal-setting, can almost double the levels of customer enjoyment. If customers feel like they are working towards a goal or a reward, they are more likely to stay loyal to a brand and invest even more money into its products.
The research also found that loyalty program members on average belong not just to one, but to nine different ones across multiple industries. Two thirds of these loyalty programs come from high-frequency businesses like groceries and drugstores.
This figure represents a 3% increase compared to the customer loyalty research from just two years ago. Some of the most prominent brands are still being cherished, but most of the others are quite simply dispensable.
As more and more users reward brands and companies that share their personal values, brand activism will continue to rise in importance. That’s why we’re seeing a sharp increase in politicized ads across all industries.
Of all those people, only 40% actually believe brands are contributing to their overall quality of life. This brand statistics research shows there is a huge opportunity for smarter businesses to attract new customers and keep them loyal to their brand.
Privacy is slowly but surely becoming the priority issue for customers in the US. It is no surprise then that over 78% of people surveyed believed that brands should not be able to use their personal data to market different things to them.
This customer loyalty study found a great discrepancy between how customers and marketers view the quality of customer experience. Almost two thirds of buyers surveyed could not even recall the last time a brand exceeded their expectations, while a staggering 87% of marketers believed they deliver an engaging customer experience.
The majority of consumers think many world-leading brands create only clutter content that has little impact on their lives. Having actual quality content will prove to be a huge advantage in coming years.
All branding statistics from the research done by Microsoft show just how powerful customer service can prove to be for any business out there. It also serves as a word of caution to those businesses that disregard the importance of customer service.
Bad and annoying experiences with customer service often lead consumers to switch brands, which is made even worse by the fact that people are more willing than ever before to abandon one brand for another.
Looking to manage your online reputation? Fill out this short questionnaire:
All retention stats like this one show how a superior customer experience helps to improve people’s loyalty to a business. Your satisfied customers will make more purchases and even serve as promoters who make recommendations to their friends, making them extremely valuable.
At first glance, a statistic like this one seems strange, as people assumed technology would resolve these issues. A deeper look, however, reveals a growing concern that the levels of personalized experiences that customers demand are not something they can achieve with current technology.
Americans share a lot of their positive and negative customer service experiences with others. In fact, customer satisfaction statistics show the average American consumer is even more likely to tell 15 others about a negative experience they had with a business.
In 2014, this number was at 67%, which indicates that US businesses have realized the advantages that quality service offers. In fact, seven out of ten consumers say they spend more money with a business that delivers great service.
Customer brand loyalty is big even for millennial consumers. Despite their relatively young age, they already have long-term relationships with brands at the rate of 60%. People grow to love certain brands due to the quality of products and service. They often go out of their way to buy from them.
Acquiring new customers has been steadily getting harder. This trend shows brands have recently started pushing for loyalty as a way to offset the costs of customer acquisition.
If you’re ever wondering what is the most direct cause of customer loyalty, this is the one answer that’s always been true. Having a great product is still the most important thing for customer brand loyalty. Similarly, offering a poor quality product remains the top reason why customers abandon the brand. 51% of people cite this very reason, while only 23.5% of loyal customers abandon brands because of poor customer service.
These giant digital brands stay on top by building loyalty through different types of products. In fact, loyal customers are six times more likely to use the same brand if they start selling a product in a whole different category from the one that they started with.
While trust in businesses erodes, trust in family, friend, and colleague recommendations keeps growing. Third-party websites that rate and review businesses are also increasingly used for getting further information about their practices and service quality.
Repeat customer statistics prove that people appreciate great service and will gladly recommend it to those close to them. This makes quality of experience the main driver in brand growth for any type of business, big or small.
This number is high, but it is also significantly lower when compared to gen X and baby boomer consumers, where an estimated 86% and 85% would leave after one bad customer service experience.
The biggest categories consumers are loyal to on the national level are electronic devices at 79%, apparel and footwear at 65%, and health and beauty products at 59%.
Customer retention statistics additionally show 33% of US consumers consider abandoning a business and switching to a competitor after just one instance of bad user experience.
It is of great importance not to get too comfortable and risk falling behind, even when your business has amassed a great number of loyal customers. Everything in the world is rapidly evolving, so consumer expectations and standards are constantly becoming higher and higher.
All brand loyalty statistics indicate that customers are reacting to the push from businesses to increase their lifetime value by requiring multiple positive purchase experiences to consider themselves loyal. A third of people will say they are loyal customers after three purchases, while only 12% will consider themselves brand-loyal after two.
Other top answers from the research are a more convenient shopping process at 50%, solving a problem or a question at 45%, and recommending products based on needs at 27%.
The same research found that 68% of consumers will view brands more favorably if they offer or contact them with proactive customer service notifications. Loyalty program stats like this one show an engaging brand is a loved brand.
The research also showed people from around the world still prioritize live-agent support. What’s more, the main reason for customer frustration at 30% is not being able to reach the support staff.
The biggest correlation between customer experience and increased earnings is with billion dollar software companies, which can make $1 billion over three years with dedication to quality service.
Consumers increasingly demand tailored experiences to maintain brand loyalty and will abandon businesses that lack personalization. A third of people surveyed said they left a brand for that exact reason, which shows the potential for revenue that customized services really have.
This represents an increase of $13 billion compared to the research done in 2016 and shows the true importance of customer retention. Businesses are already responding to this trend by starting to prioritize customer service over product quality and price.
The same study found that only 30% of customers felt companies made that connection with them in 2018. People are increasingly comparing a business to the best service they had, no matter the industry. This pushes companies to focus increasingly on customer service.
The research revealed a wide gap between younger and older people, with customers over 55 having a completely different outlook on social media platforms. 75% of them believed those platforms are not viable for customer service.
The statistics we compiled here show the true importance of customer loyalty. All trends point to an industry that is bound to continue experiencing huge changes and even bigger challenges.
While the quality of product and service is more important than ever, customer satisfaction can make or break almost any business. So, companies that fall behind on technological innovation are bound to be forgotten.
As the number of quality competitors gets higher and higher, there will be fewer chances to come back from a business or a PR mistake. Never before has there been such a focus on emotion, virtue, and personal values as there is today. Reputation management services are a useful tool in maintaining a positive image of your brand online.
Here’s the bottom line:
Brands that have to navigate the increasingly politicized society are going to tread carefully. The customer loyalty statistics we presented clearly show one misstep now costs more than many companies are prepared to pay.
People are increasingly willing to abandon and change brands when there are multiple quality solutions out there. What’s more, the future is only going to get more complex with the emergence of new, disruptive technologies.
Your email address will not be published.