1.5. Loyalty
Branding strategies and marketing activities have been evolving over time becoming very complex and customized in order to better satisfy the needs and wants of consumers. Not only do these strategies and activities focus on the functional attributes of products and services but also on the intrinsic values and experiences they are able to provide, which nowadays constitute the determinant factors affecting the consumer’s final choice of purchase. The ability to build a distinctive brand with a strong and unique presence in the marketplace was also proven to be a key success factor for businesses competing in the complex and heterogeneous industry. (Hampf &Lindberg-Repo, 2011).
The proper match of beliefs and values between the …show more content…
Building an emotional bond with the customers ensures long term sales stability, higher returns from supplemental products and services, lower costs regarding consumer education and marketing (given that they become non lucrative promoters of the company) and allows to better understand the potential target customers of the organization (Shawn, 2002). Another advantage of consumer loyalty is the fact that it is cost efficient. According to the studies of Emmett C. Murphy and Mark A. Murphy (2002), acquiring new consumers is five times more expensive than retaining existing ones, having a 2% increase in consumer retention has the same effect as decreasing costs by 10%. (Murphy & Murphy, 2002). Thus, companies with loyal consumers do not have to spend as much money on marketing the product, which permits to either retain more earnings or to invest resources elsewhere. Along the same lines, according to the Harvard Business School, increasing customer retention rates by 5% increases profits by 25% to 95% (Reichheld & Schefter, …show more content…
Thus, building a successful loyal customer base starts with the acquisition of the right customers who show the same interests and values than the brand. The achievement of this ultimate business objective will be finally determined by the satisfaction with the product purchased, the service received, the capacity of the brand to reflect who the consumer is or who he wants to be, and the ability of the business to provide added value and undertake strong engagement
Branding strategies and marketing activities have been evolving over time becoming very complex and customized in order to better satisfy the needs and wants of consumers. Not only do these strategies and activities focus on the functional attributes of products and services but also on the intrinsic values and experiences they are able to provide, which nowadays constitute the determinant factors affecting the consumer’s final choice of purchase. The ability to build a distinctive brand with a strong and unique presence in the marketplace was also proven to be a key success factor for businesses competing in the complex and heterogeneous industry. (Hampf &Lindberg-Repo, 2011).
The proper match of beliefs and values between the …show more content…
Building an emotional bond with the customers ensures long term sales stability, higher returns from supplemental products and services, lower costs regarding consumer education and marketing (given that they become non lucrative promoters of the company) and allows to better understand the potential target customers of the organization (Shawn, 2002). Another advantage of consumer loyalty is the fact that it is cost efficient. According to the studies of Emmett C. Murphy and Mark A. Murphy (2002), acquiring new consumers is five times more expensive than retaining existing ones, having a 2% increase in consumer retention has the same effect as decreasing costs by 10%. (Murphy & Murphy, 2002). Thus, companies with loyal consumers do not have to spend as much money on marketing the product, which permits to either retain more earnings or to invest resources elsewhere. Along the same lines, according to the Harvard Business School, increasing customer retention rates by 5% increases profits by 25% to 95% (Reichheld & Schefter, …show more content…
Thus, building a successful loyal customer base starts with the acquisition of the right customers who show the same interests and values than the brand. The achievement of this ultimate business objective will be finally determined by the satisfaction with the product purchased, the service received, the capacity of the brand to reflect who the consumer is or who he wants to be, and the ability of the business to provide added value and undertake strong engagement