Emotional Loyalty

How Emotional Loyalty Increases Positive Business Results

At Clutch, we have been in the business of loyalty a long time and have seen a lot of changes. More recently, brands are beginning to think about different types of loyalty such as emotional loyalty and how to incorporate those concepts into their loyalty programs. Customer relationships with brands are evolving. People value different things and change behaviors accordingly.

Emotional loyalty is impacting the way brands build and maintain loyal customer relationships. Clutch is working diligently to develop tools for an impactful loyalty program.

What is Emotional Loyalty?

Emotional loyalty is when a company or brand creates a trusting relationship with a customer to make them feel special. The goal of emotional loyalty is to keep the customer coming back and wanting more from the brand. The emotion between brands and consumers drives a strong relationship for the future.

…”Emotion represents the greatest indicator of future growth”  

-Forrester

Connecting with customers is more challenging than you would think. According to Forbes, “customer retention is declining. About 66% of consumers are more likely to switch to the competitor that provides the best customer service or experience.”

Simultaneously,  customer expectations are increasing. In a Consumer Pulse Survey in 2019, it was found that 93% of consumers believe it is important that every interaction they have with a brand is excellent.

What is the future of emotional loyalty?

Emotionally loyal relationships are aligned to the brand experience. Customers get a better experience with the brand when their experience is more personalized to their needs. Younger consumers want to connect with their brands and run their own journey. Distinct loyalty is connected to every brand interaction across the customer journey.  Customers are getting experience-based rewards and expanded benefits. This is making their relationship with the brand more personal.

When building a business, it is important to build long-term emotional loyalty and brand affinity.

The transactional model is simply when a customer pays for a good or service, they receive said good or service, and that’s that. Although this is the traditional way to run a business, it is not the most effective way to keep a customer coming back.

The emotional model is getting your customers to act “emotionally”, where purchases are made with a feeling of connection. A great example would be sports fans who buy merchandise to feel connected to their teams. Make the customer feel important when interacting with your brand! For example, some brand loyal customers may only fly on one specific airline so they can get their reward points, even if another airline is cheaper or requires less travel time.

What are some trends shaping customer loyalty?

There are several trends impacting customer loyalty. These include privacy trends, growth in subscription, dynamic gamification, and community engagement.

Privacy Trends: Customers care how the data they share is being used, and brands that not only adhere to privacy standards but are up front about how they use customer data will gain loyalty from customers.

Subscription Models: More customers are interested in joining subscription-based loyalty programs where they pay an up front fee for benefits. When benefits are aligned with what customers want, everyone wins.

Gamification: Customers are interested in companies that participate in giveaways and contests! Creative use of these strategies will increase engagement from existing customers and help gain ones as well.

Collective Engagement: Companies that engage with local communities through events or social causes and trends are able to connect with customers in a different and – oftentimes more impactful – way.

What are the key drivers to emotional loyalty?

There are four key drivers which support emotional loyalty. These drivers are: Special Recognition, Status & Exclusivity, Surprise & Delight, and Alignment with Brand Values.

• Special Recognition is important because it creates a unique story for each customer. Customers feel special through the brand targeting them based on coupons for things they are interested in and other perks.
• Status and Exclusivity highlights lifetime loyalty. Customers feel special when they reach a certain tier in a loyalty program.
• Surprise and Delight is made to make the customer want the benefit of the perks they received again. The customer will keep engaging with the brand if they know they will be getting benefits like no other.
• Alignment with Brand Values is very important to a customer. Customers are reevaluating their priorities as society changes. Brands are now focusing on where they stand with social and political issues. This is a major trend with younger consumers.

Are you interested in learning more about emotional loyalty? We can help!

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