New Loyalty Report from O2 and the Global Future Forum reveals:

  • Most people still react positively to the concept of loyalty – 76% of consumers still believe its relevant to way they live their lives
  • Young people in particular want to be loyal – over 80% of 16 – 24 year olds believe they are very loyal
  • Its not brands and technology that drives loyalty, its people – impact of human touch far exceeds, innovation, technology or price in retaining business
  • Episodic loyalty is replacing traditional consumer relationships – today consumers defect from brands simply because they move on. We are emotionally committed whilst in relationship, but flexible lives and identities mean we are ‘outgrowing’ them quickly giving rise to a new kind of loyalty

    UK consumers have less patience with brands and companies than ever before, however 76% of consumers still believe that the concept of loyalty is as relevant as ever to the way we live our lives.  These findings are just one of the many complex paradoxes characterising the role of loyalty today in consumer’s lives according to “The Loyalty Report” published today by O2 and The Global Future Forum (GFF).   The report is one of the most comprehensive contemporary studies undertaken into loyalty, involving in-depth interviews with over 1000 UK consumers through a mix of quantitative research and focus groups. The findings reveal, that whilst most consumers believe they exhibit less loyalty to products, services and each other than 30 or 40 to years ago,  just 22% believe that the concept is out of date. Remarkably, the concept of loyalty is at its strongest among younger people aged 16 – 24, the very demographic whose advanced technical savvy abilities would suggest them to  be the most discriminating and least loyal.   The report reveals how multiple causes are combining to define this new expression of loyalty such technology, innovation and increasingly sophisticated marketing techniques. However, far from building loyalty – special offers, promotions and reward cards – the armoury of the savvy marketer are actually helping to erode loyalty. 57% of consumers admitted they regularly jumped from brand to brand in search of the latest product or best deal, whilst 56% of us change products simply because we would like to try new and innovative things.  Increasing concerns over being taken for granted are also encouraging consumers to exit ‘established’ relationships. 65% of us believe that the longer we remain loyal to a company the more they take us for granted.    The impact of technology is also clearly felt. Half of all those surveyed felt favourable towards companies allowing them to purchase online and online price comparison sites were considered the most influential force determining buying habits after family and friends. But, other advances such as automated voice services or the cross selling of products and services were seen as less positive.  Overall, providing access to staff to help resolve problems and deal with enquiries was cited as the most influential action a company could take to help shape positive opinion.   The report concludes that these trends are all part of new hierarchy of trust and loyalty termed Episodic Loyalty which businesses and brands need to understand. In this new hierarchy, personal relationships come top, followed by our work, then the sports teams and finally our commercial relationships. The importance of trust, human contact, a sense of shared destinies and equality are all clearly in evidence at the top of this hierarchy.    Bob Tyrell, author of the report at the Global Future Forum, observes: “The report suggests that loyalty as we traditionally view it, built around unwavering support no longer applies. The speed of change today in our lives means that consumers are regularly out growing their suppliers and in place of life long loyalty is a new form of ‘episodic loyalty’. The analogy may be a brief and passionate affair: deeply meaningful for both parties whilst it lasts, but never intended to be forever.  Only those brands that can cleverly prolong these episodes of emotional commitment and keep pace with the personal growth of their customers will succeed.”   Commenting on the research findings, Cath Keers, Customer Director O2, adds: “Episodic loyalty is about people wanting fresh new experiences regularly not about fickleness. The O2 Loyalty report brings home the fact that loyalty is something which needs to be continually earned by businesses, not gained once and then banked forever.   “People and personal relationships are also vital in this world of episodic loyalty. When you have a great experience that goes beyond quality of service you are going to return again and again. Businesses that consistently create and adapt to these touch points and surprise and delight their customers are going to the ones that survive and thrive.”

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