Yes, relevance is superior to loyalty in Marketing!
Traditionally, most marketers use rebates, rewards, giveaways, discounts, and bonuses as a customer retention strategy. But this approach has two main challenges – first of all, it is not cost effective and secondly, you could easily lose your relevance in the process.
Business environment evolves
As the business environment evolves, the loyalty era is also ebbing away. Customer loyalty was largely based on the notion that as long as you have the right incentives in place, customers will keep buying from you. But recent studies paint a totally different picture. For instance, consumer research from Kantar retail reveals that 71% of clients believe that incentive programs have no impact on their brand loyalty.
What Customers are really purchasing
Customers no longer purchase based on brand loyalty. Most make their purchase decisions based on the brand relevance and how the brand meets the specific needs at the moment. According to the Harvard Business Review, American companies are losing revenues amounting to $1 trillion annually due to the fact that they are not consistently relevant. Even though brand loyalty is still important, it is no longer feasible to focus all marketing efforts on creating loyalty. The future of marketing lies in trying to be as relevant as possible to the consumer by trying to meet their most pressing needs.
Rethink the whole issue of Relevance
The marketing professional needs to rethink the whole issue of relevance. A good place to being would be looking at Maslow’s hierarchy of needs. This means that instead of focusing too much on the four Ps of marketing (Product, Price, Place, and Promotion), companies need to start thinking of how they can meet the psychological needs of the consumer. We live in a very dynamic environment which means the needs of the customer will oscillate from time to time. As their needs keep changing, customers expect brands to change as well, and when this doesn’t happen, they quickly move to another company that is more responsive to their needs.
5 Points that are worth focusing on
In order to be more effective, companies should focus on the following Ps.
- Purpose – the goal of any business should be to focus on a purpose that resonates with the values of the consumers.
- Pride – every consumer wants to use a product or service that they are proud of or at least one that inspires them.
- Partnership – every business should endeavor to relate well with the customer in order to establish a long-lasting relationship.
- Protection – customers should know that it is always safe to do business with the company. For instance, they should know that the company takes data security seriously.
- Personalization – every company should strive to give each client a customized solution or at least an experience that is personalized.
Meeting the five Ps all at once might not be achievable for most companies, but you can decide to roll it out in stages. But you must be ready and willing to get out of your comfort zone. You must be willing to shake up your business to reinvent the marketing strategy. As tempting as it might be, do not be loyal to the status quo. Dare to do things differently because as Albert Einstein aptly put it, “insanity can be defined as doing the same thing over and over again and yet expecting different results.” In today’s business landscape, achieving brand loyalty is not as crucial as being relevant is.
Author: Ronald Amaya
My academic background is in I.T and I have 9 years experience in web design and social media management. I love writing articles in business, cryptocurrency, management, and marketing niches.