Discussion Replies: Customer Loyalty, Global Marketing, Marketing Research, Branding

Concept

            Customer loyalty is defined as “a customer’s commitment to a company and its products and brands for the long run” (Marshall, G.W. & Johnston, M.W., 2019, p. 56). The primary goal of customer loyalty is to increase the ability of companies to retain consumers, while reducing the number of consumers that switch to another brand. Customer loyalty is almost always related to the different forms of value that the consumer gains from their relationship with the company and its brands. With the exception of monopolies (in which as customer is forced into the relationship), customers who have a strong sense of loyalty to a certain brand/company also tend to have a high level of satisfaction with said company (Marshall, G.W. & Johnston, M.W., 2019). However, it is important to note that customer satisfaction does not equate customer loyalty. Oftentimes, satisfied consumers will easily switch to the competitor if they perceive a better value can be obtained. The loyal consumer is less likely to be swayed by the competition (Marshall, G.W. & Johnston, M.W., 2019). Therefore, it is vitally important for businesses to strive to keep high customer satisfaction levels with long-term customers in order to retain them for as long as possible. 

Application/Example

            A great example of long-term customer loyalty can be found when looking at Amazon. Amazon has a strong desire to create the best consumer experience possible in order to retain current customers and gain new ones. One of the biggest ways that Amazon does this is through its employees as it strives to create a consumer based mindset. There are currently 14 Leadership Principles that guide Amazon employees, and the very first one is customer obsession. It states: “To go from good to great, to ‘see around the corner’ for your customer, or to change an internal culture, obsession will deliver different insights” (Denning, S., 2019, par. 10). This belief is evidenced by the way in which Amazon goes above and beyond to thoroughly research any new idea, including measuring how it is received by potential consumers, before implementing any new product or service (Denning, S., 2019). An example of a successful idea that was created for the consumer’s benefit was the introduction of Amazon Prime. Amazon Prime is a customer loyalty subscription that consumers can sign up for at either a yearly or monthly fee in order to gain benefits such as free two day shipping and access to Amazon prime video.

            It is clear that whatever Amazon is doing, it is indeed working. A study in 2017 revealed that 85% of Amazon Prime members visit the site at least once a week. Moreover, about 56% of non-Amazon Prime members also reported that they visited the site at least once a week.  Several customers further reported that they will seek out Amazon to compare prices before purchasing from another site, therefore indicating that Amazon is their first choice. It is also notable that Amazon is now ranked 8th out of the top ten most reputable firms in North America, and it is ranked 18th globally (Danziger, P.N., 2018).

Question

            When looking at customer loyalty, it is clear that it has a significant affect on the success of a business. A business is not a business without the money earned from its consumers. Therefore, it is vitally important for businesses to ensure that they consider the consumer in the implementation of any process that could affect their consumer. With that in mind, if you were starting a new company, what would you implement (processes, customer service teams, etc.) in order to gain customers and keep them as loyal consumers?