What drives loyalty in retail advertising?

As the cost-of-living crisis passes its tipping point, consumers are increasingly abandoning their favourite brands in the hopes of finding a better deal. This means that competition between brands has never been fiercer and maintaining customer loyalty has never been more important.

For retailers, who rarely operate within subscription-based models, this change in consumer behaviour is especially pertinent. But, despite market challenges, there are still plenty of ways for retail advertising to drive loyalty – as we’ll explain in this post.

Customer loyalty in retail – why is it important?

Achieving high levels of customer loyalty is an aspiration of most businesses, but in the competitive retail landscape it verges on being vital. Consumer behaviour in retail environments can be impulsive and customers might easily be swayed by another brand’s offering, so establishing a strong relationship is crucial for long-term success.  

With acquisition costs increasing all the time, focusing on retaining the customers you have is a shortcut to improving ROI. And it’s a cyclical loop – the more that you interact with your existing customer base, the more that you learn about them and the better informed your marketing efforts become.

Returning customers don’t just provide opportunities for cross-sales and repeat purchases – they can also be a highly valuable marketing channel. Word of mouth is the primary factor behind 20-50% of purchasing decisions, and loyal customers are your brand’s best advocates.

What drives customer loyalty?

So, customer loyalty is important, but what makes the difference between happy, returning customers and those who buy once and never again? There are several factors that drive customer loyalty – let’s take a look at the most important ones.

1. Quality and consistency

Quality and consistency are big drivers of customer loyalty, which comes down to loyalty being a two-way street. By asking customers to be loyal to your brand, you are asking them to consistently choose you. In return, they expect you to consistently deliver high-quality goods and services that give them a reason to keep coming back, rather than branch out and try something new.

2. Listening to feedback

Much like in personal relationships, people tend to display loyalty towards brands that nurture their customer relationships by actively listening. Paying attention to what customers have to say and acting upon their feedback demonstrates a commitment to customer satisfaction, which in return fosters trust and loyalty.

3. An omnichannel presence

Online shopping is now a steadfast part of everyday life, and most consumers interact with brands across both online and physical environments. Without an omnichannel presence, consumers who intend to remain loyal to your brand might find that they are unable to, and will instead be forced to turn to a competitor.

4. Brand reputation

Your brand’s reputation can have a huge impact on the ability to attract and retain customers. When a brand is a known entity with a positive reputation, customers feel more confident to interact with it (and are more likely to offer a second chance following a substandard first interaction). Aside from developing trust, your brand’s reputation also helps to communicate your values to your target market, building brand affinity that keeps customers loyal.

5. Convenience and affordability

For some people, it doesn’t matter how much they relate to a brand or enjoy the quality of its products – they will always make their purchasing decisions based on convenience and affordability. A great example of this in retail is supermarkets, where consumers will often buy from whichever brand has the best offer on that week.

How to foster customer loyalty with retail advertising

We know what drives loyalty, but how easy is it to obtain? With the right customer-focused strategy and a consistent approach, results can be achieved surprisingly quickly. Here’s how to use retail advertising to improve customer loyalty:

• Introduce a loyalty programme – using retail advertising to introduce a new loyalty programme or promote an existing one will remind shoppers of the benefit of their loyalty at the point it matters most.
• Focus on convenience – customers will often take the easiest option, and focusing on convenience in your messaging can offer them just that. For example, using high street advertising to provide directions to a nearby store can reduce decision-making stress for busy shoppers.
• Amplify offers and promotions – price-motivated individuals, who are especially common in supermarket advertising environments, will consistently respond to messaging around current offers and promotions.
• Make the most of strategic ad placements – targeting shoppers with in-store or close-to-store advertisements will reinforce your brand’s presence in their minds, leading to better recall as they scout the aisles.
• Offer exclusive products – exclusivity is a big draw when shopping for clothes, jewellery and other products you might find in shopping centre advertisements. The perceived added value of an exclusive product or deal can help draw customers back into the funnel following a previous purchase.
• Use personalisation – personalisation in advertising is one of the most effective ways to increase engagement, and with every new interaction, a stronger connection is forged between brand and customer.
• Take an integrated approach – omnichannel strategies ensure that your brand and your customers stay connected across mediums, delivering frictionless experiences.
• Build your brand – issues like sustainability and inclusivity are becoming more important to consumers, and increasingly factor into buying decisions. Retail advertising can help to drive home core brand values and build affinity with customers, which translates into loyalty.

Reach customers and drive loyalty with OOH retail advertising

In competitive retail environments, customer loyalty is becoming an increasingly important part of driving growth. Out of Home (OOH) advertising provides a vital link between brands and the customers they’re trying to connect with, offering a variety of engaging formats that capture attention while customers are out shopping.

To find out more about OOH retail advertising and how it can be used to both reach and retain valuable customers, please get in touch today.