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Brand loyalty is an integral part of building a brand, as consumers usually have a choice of products in
same market segment, and so a successful company will come up with a way to keep consumers re-buying their product or coming back to their location rather than going to a competitor. These brand loyalty-building efforts may come in form of coupons, incentives such as many grocery chains' technique of "grocery discount cards" or "loss leaders," meant to draw consumers into store, where they will hopefully buy products along with discounted fare at a higher profit ratio. In exchange for these discounts and grocery cards, many companies collect information about buying habits and average spending amounts, better to tailor advertisements and better-focus future promotional efforts. Once a consumer is hooked, brand loyalty tends to result in higher sales volume, as well as loyal customers being less sensitive to price changes of their favorite brands (within reason, of course), as well as less sensitive to competitors' incentives. Studies have shown that it takes 5 times as much money to gain a customer as it does to retain one. That's 5 times as much money as could have been spent on other things.
A brand is who your company is, and what it is selling--it is as important as naming a baby, and should require same amount of effort to develop it, but if done well, can mature into a successful and profitable adult.
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William King is the director of All Wholesale UK, Wholesale Pages and Wholesale-Canada. He has 18 years of experience in the marketing and trading industries and has been helping retailers and startups with their product sourcing, promotion, marketing and supply chain requirements.
