Intuit Inc., the global financial technology platform that makes Intuit TurboTax, Credit Karma, QuickBooks, and Mailchimp, released a new report, “The Science of Loyalty,” focused on the drivers behind consumer behavior and tangible insights that marketers can take to build loyalty and cultivate meaningful relationships between their brand and its customer base. The report includes findings from a survey of 4,000 consumers across the United States, Canada, the United Kingdom and Australia – with 1,000 participants per market – and qualitative interviews with eight global marketing experts. It also introduces new resources like the Loyalty Wheel, a proprietary framework that breaks down the fundamental pillars of loyalty within the consumer brain.
“The Science of Loyalty” uncovered that as brands and marketers build stronger relationships with their existing customer base, those customers are significantly more likely to purchase from the brand again, a cost-effective solution to the rising costs and resources it takes to acquire new customers. Diving into science-backed loyalty strategies can assist brands and marketers with setting their brand apart from the competition. Approximately 70% of consumers emphasize that it’s important for them to buy from the “right brand,” reflecting a desire for more conscious decision-making.
“Loyalty is more important than ever,” said Michelle Taite, Chief Marketing Officer at Intuit Mailchimp. “In today’s ever-changing business landscape, characterized by overwhelming amounts of data and endless options, brands and marketers should be equipped with the tools and resources needed for marketing strategies that make an impact and build meaningful connections that drive loyalty with their customers.”
The Commitment Spectrum
The report finds that loyalty falls on a spectrum. To better understand the types of loyal customers, Mailchimp created a commitment spectrum, which ranges from “inert” to “fandom” loyalty. Loyalty begins on an inert level, where consumers purchase from a brand not out of preference, but out of convenience. Moving up the spectrum, other loyalty categories include habitual loyalty, where loyalty emerges from routine rather than emotional ties, followed by dedicated loyalty, where consumers form an emotional connection to the brand’s vision and purpose. What many brands and marketers view as the pinnacle of loyalty—fandom—is characterized by a strong emotional bond and shared values amongst the brand’s community.
While inspiring fandom may be the goal for many brands and marketers, only 13% of respondents belonged to the fandom loyalty group. Experts like Richard Shotton, author of The Illusion of Choice, caution that such affiliations can be extremely hard to cultivate and may not make sense for every brand. Most brands are likely to have a mix of all of these customers, and a good strategy should have tactical approaches that target different levels of commitment.
“I think a goal like loyalty, whereby people avoid better alternatives out of a sense of obligation or genuine passion, is phenomenally hard to achieve,” said Shotton. “The danger is that marketers overestimate their chances of achieving that and maybe convert their budget into smaller sales rather than [pursuing] the much, much simpler goal of habit.”
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