Are customers still loyal to brands?
If you’re anything like me, you don’t take any significant purchase lightly. You do a lot of research, Googling and asking your mates what their experiences were when making similar buys. What you probably don’t do is stay loyal to the same brand over and over again just because your parents and grandparents did.
But that doesn’t mean that customer loyalty is dead. You only have to look at the sales figures every time a new iPhone comes out to see that. But it does mean that businesses must work harder than ever to achieve that loyalty. A good place to start on that front is understanding the difference between customer loyalty and brand loyalty but also how they intersect to come together.
Different kinds of loyalty
Customer loyalty is when people repeatedly purchase products or services based on discounts, price points, and rewards programs. They don’t have any kind of emotional connection to the brand and will switch to a competitor as soon as they think it’s in their best interests to do so. In other words, they might switch from FNB to Discovery Bank one year because it offers a better loyalty programme and then switch back if eBucks improves again.
Brand loyalty, on the other hand, is when someone buys the same brand repeatedly because they love it. More than that, they trust it and believe in the brand’s values. Apple has this kind of loyalty, built on emotional connections, in spades.
This is the kind of loyalty you really want. Brand loyal customers spend more than first-time customers, which is important when you consider that research shows it costs a business five times more to acquire new customers than it does to secure recurring ones. Most businesses also derive 65% of their revenue from brand loyal customers, making them vital to the fortunes of any company.
Does loyalty exist today?
As much as every business would like its customers to demonstrate brand loyalty, the reality is that loyalty is taking a downturn. A 2023 survey found that 66% of customers are loyal to a certain brand. That’s a 10% drop from the same survey in 2022. People also expect brands to do more to gain their loyalty. In 2022, 13% of shoppers worldwide felt that retailers and brands needed better loyalty initiatives. This year, that’s risen to 20% in 2023, marking a sizeable increase of 54%.
At Kruger Gate Hotel we have great repeat guest stays – and this even after de-flagging from Marriott International management last year. One would associate huge brand and customer loyalty to the largest hotel group in the world, but being an independently owned hotel has allowed us to tap into experiential travel, which is so important to today’s traveller. So, while loyalty may be declining in certain sectors, we’re privileged to be bucking the trend – but it takes hard work to achieve this. Having been fortunate enough to have worked in hospitality for many years, I have learnt that it’s not just one aspect of a hotel that inspires this kind of loyalty, which means hoteliers need to constantly keep an eye on every part of their business.
I believe the brand loyalty our guests show is due to their high regard of our services and staff friendliness which is fuelled by a culture of inclusivity and support that our management and operational teams inculcate across teams. The care cultivated amongst team members informs the deep care that we deliver to our guests. Our brand loyalty also stems from our excellent amenities, value for money, and the hotel’s ideal location by the Paul Kruger Gate and along the Sabie River.
Our high guest satisfaction scores – a 4.5 (out of 5) rating on Google reviews, a 4-star rating (out of 5 stars) on TripAdvisor and an 8.9 (out of 10) rating on Booking.com – and thousands of online reviews detailing our guests’ experiences reflect this. We know that the star grading awarded to a hotel by the TGCSA is nothing more than a placard. Ultimately, guest feedback will always be our true yardstick by which we can measure our service and facilities. It’s also gratifying to see how happy guests become advocates for us. On Facebook groups about the Kruger, our name constantly comes up when people ask about a place to stay.
When speaking about loyalty, it’s also worth noting that companies and brands are also loyal to third-party service providers and partners. To have partnerships that aid in your company’s success is highly valuable, and we’ve achieved this. We truly value and appreciate these partners, and I’m sure many other businesses feel the same about their own partners.
How to inspire loyalty in a new era
Building an authentic relationship with customers is vital to building trust in brands. That’s why the same level of care and personalisation should be taken with every interaction and touch point a business has across the entire customer journey. Each of those interactions adds up to the kind of great customer experiences that powers long-term brand loyalty, whether it’s in billing, sales, unique moments on the property, or service.
As such, the modern hospitality industry must look to more organic ways to entice repeat guests or “money can’t buy” experiences that evoke an emotional connection. Furthermore, any business that does something truly unique compared to their competitors will naturally stand out and develop brand loyalty. This doesn’t mean businesses need to execute something extravagant.
At Kruger Gate Hotel an example of one of the special touches we’ve incorporated to achieve this is by having a dedicated intimate braai broodjies area for guests. South Africans appreciate this celebration of heritage and enjoy something that feels familiar and international guests can try something completely new and memorable.
Finally, loyalty today is not about loyalty programmes targeting thousands of people – it’s about showing loyalty to each customer. Customer-centric loyalty is about engaging directly and connecting with a guest in order to provide them with a positive experience and build long-term relationships. Loyalty becomes the by-product of that guest’s positive experience with you – and it’s key in ensuring long-term success.
Essentially, to ensure brand loyalty, businesses must value their customers by building meaningful relationships with them, delight them with one-of-a-kind experiences and never let up in providing high quality and reliable products and services.
By Anton Gillis, CEO of Kruger Gate Hotel