The loyal end of the stick 

This year’s BrainyBar debated a topic that every brand should have top of their agenda, the science of loyalty. We kicked off with presentations from our host Dr Cristina de Balanzo and Head of Behavioural Science at Walnut, part of Accenture Song, Andreea Redfern, followed by Dan Bowers, Chief Strategy Officer at TMW, part of Accenture Song. You can recap on the highlights from their keynotes HERE.  

To close the night, Cristina invited to the stage a panel featuring Radha Davies, Marketing Director at Sainsbury’s, VodafoneThree’s Chief Brand Officer Maria Koutsoudakis, and Non-Exec Chair of the DMAs and former CMO of Direct Line Tony Miller. Check out their insight-rich discussion below.  

TO BEGIN, WHAT IS THE BRAND THAT YOU ARE LOYAL TO? 

Maria: Well, I’m six cars in and it’s always Land Rover. ​I know there is an issue, as they are a highly sought after vehicle by thieves, ​​​and I spend my whole life installing camera​, immobilisers and steering locks​ to make sure they’re safe. Despite that illogical extra hassle and stress, I still go back to it. There is the persona, the image, the way they market the vehicles that feeds into that. It’s the one car brand that has built a world that I can clearly see myself in and want to keep going back to.  

Tony: I bought my first Mac in 1987, and I’ve always had one ever since. Same with the phone. There are probably tech phones out there that are a lot better now, but there’s just that emotional connection with the usability, the design, the feel of it.  

I would say Butternut Box makes the list too. For one thing, it’s the only food that my dog will eat, but also just knowing that I’m giving him nutritious, healthy, “people” food really drives my loyalty.  

Radha: I’ve got a sweet tooth so of all the brands, I’m very loyal to Cadbury’s chocolate. That’s related to “the glass and a half of milk” that’s in it, the delicious flavour and all the rational reasons for why. But it’s also thanks to the childhood memories associated with it – my dad always had a Freddo in his pocket for me, so if I’m ever in need of a pick-me-up, Cadbury’s is the brand that I tend to go back to time and again.

THINKING ABOUT THE BIG PICTURE, WHERE DOES LOYALTY SIT IN A BUSINESS?  

Tony: It can’t just sit in marketing, or product or sales – it needs to be a shared ownership between all. The brand purpose is built on what we believe as a business, where we want to go and how we want to serve our customers. So for me, loyalty sits centrally to the business objectives. Then as a team you figure out how you bring that to life.  

Maria: I agree, it’s not a department or a programme and we don’t execute it that way because you need to put it somewhere it doesn’t get forgotten. Generally, it gets lumped in the rewards section and that’s a neat way to think about it. But in theory, it should be in everything you do to build those elements into your DNA. Going back to Land Rover, there’s no loyalty programme in sight. But no, loyalty needs to be at the heart of everything you do.  

Radha: In grocery retail loyalty is an outcome and we tend to run it like a programme just because of the sheer complexity of the weekly shop. There’s a lot of enterprise-wide thinking about the mechanics of it. As an outcome, it’s about having the right products in place, building consistently good experiences for shoppers, and exceeding customer expectations through the end-to-end experience.  

WHAT MAKES YOUR CUSTOMERS COME BACK EVEN WHEN THERE’S A CHEAPER OR EASIER OPTION? 

Tony: Ultimately, ​i​t’s about trust and service and the overall end-to-end experience. Within insurance, it starts (and ends) when a claim is made, with emphasis on how the customer is treated, how quickly the claim is processed, ​and ​ultimately​, the overall ​​     ​outcome. It’s moments of truth that really define if loyalty is earned. You can do everything to the nth degree to prepare, use the right tech, use the right comms and tone of voice, but for the insurance ​category​, having a good end-to-end experience is what ​ultimately ​matters.  

Radha:  In grocery retail value really matters. People are super price-sensitive, and they have a lot of options of where to go, so we work hard at that feeling of value. But it’s also about doing it in an easy, fun way and giving customers value in the things that matter most to them, so that personalisation piece is vital.  

Maria: Looking at why people turn to us at telco, it’s network performance. The number one reason to stay is because it works and it works in my world, i.e. for the customer in their day to day. For example, the nation’s network was a strategic platform for us on the basis that we needed this big, global ​brand  ​to feel local because that’s the way you judge experience. It doesn’t matter that you’ve got 5G in Spain, it matters a lot more whether your connection works on your commute, in your workplace or your home. Network performance is a very personal and local experience. ​     ​ 

For us it’s about value and about being valued. Customers have an expectation of “I’ve been with you for 15 years, you have all my data, you should know everything about me and reward me for staying.” It’s an expectation that I’ve never seen in any other category. So there is that value element, but you’ve got to fundamentally work and build from that strong foundation. Often customers only judge us at pain points versus delight points.​     ​ 

DO YOU THINK THAT TRADITIONAL LOYALTY MECHANISMS ARE WEAKENING? 

Radha: I’m not sure that they’re necessarily weakening but they are definitely more ubiquitous. There are more brands, more loyalty programmes, all using the same mechanics. They all feel quite homogenous, so how do you differentiate? How do you build elements into your programme that are unique, or make people feel a different way, or capture something more imaginative, more playful, more enjoyable than the rest to create that hook?  

Tony: Every brand ​needs​ to build loyalty but how deep do you ​need to ​go? Offering points, coffees and newspapers isn’t new or ultimately always necessary. You need to understand your customers to the nth degree so that you know what is in the next ring of influence for them. You have to find the nugget that strikes the emotional chord, especially in low interest categories.  

Maria: The principles are not lost, it’s just harder to apply them. The programme needs to become a proof point for why the brand exists. Our pivot to the nation’s network is underpinned by the thought that we power those connections that bring the nation together. We sponsor Glastonbury, Wimbledon, and the Six Nations – three of the biggest free-to-view moments across the annual calendar for the UK – so injecting that into the loyalty story becomes very important. You have to remind people of the good things that we stand for because they tend to remember only the bad things.  

Radha: The linkage to brand is really important. I used to work at Virgin and what they’ve done so well is codify what the brand stands for and then set expectations on the experience that you get. They use ​brand ​as a key differentiator. So whatever category they play in, you know what you’re going to get with Virgin, which gives you a reason to go with them versus the incumbent.  

They’ve built ​a ​reputation as a challenger brand that goes in to shake up categories and the status quo. It was a fascinating loyalty programme to work on because whatever category you’re in, you need to imbue it with the same master brand character, so introducing playfulness, surprise and delight, and opportunities for you to feel that sense of belonging, was very important in the design.  

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DO YOU THINK THAT LOYALTY NEEDS TO CHANGE? 

Tony: ​Loyalty ​ needs to evolve as ​customers ​evolve. We’ve all mentioned how busy, how distracted we are. Repetition is key. We have to lean into all the techniques and behaviours we trust as marketers. Loyalty can’t be static​, it has to change as customers change​.  

Radha: The more data you have on your customers, the more you need to use it well. This is where personalisation plays a big role. But there’s also a focus on utility, so how do you help your customers to achieve the goals that matter to them.  For example, we have a Healthy Choices Challenge where we help customers to actively increase the amount of fruit and veg in their basket, something they have told us they are keen to do.  ​     ​ ​     ​ 

Maria: When I think about our category where 80% of our sales come from existing customers, the most indicative behaviour of loyalty is churn. Everything else is in service of that. It varies by business, so it would be very different in FMCG or retail. But it’s an interesting challenge to not take the industry norm, rather really think about what it means for your objectives, your business, your category, and galvanise around that.  

WITH ATTENTION SPANS COLLAPSING AND AI TRIGGERING AN ABUNDANCE OF CONTENT, HOW DO YOU CONTROL THE VOLUME? 

Radha: What this opportunity offers us is a means to be hyper-relevant. Rather than fragmenting with multiple messages, you can really personalise and use AI to create lots of different versions that target the right message to the right individual. That’s what I hope we can get to.  

Maria: Talking about the same thing in an innovative way is really difficult over time. And now we’re having to talk about the same thing on seven different platforms in three different formats and seven different languages, which is exhausting. What AI will allow us to do is to stick to our message. When we get bored, we change the message, but that inevitably dilutes it. If you put some guardrails on the technology and ask it to innovate your core message, there’s actually a lot more creativity to it.  

Equally, the fundamentals of brand are now even more important to hang onto – using the tech for multiplicity of the same message rather than for multiple messages because the danger is when you lose your identity in the multiplicity.  

Tony: Added to that is the ability to test and learn so that you get to the right message. You can choose a plethora of messages that iterate very quickly, which means that landing on the right one is a lot quicker. 

HOW DO YOU EMBRACE THE POSSIBILITIES OF TECHNOLOGY WITHOUT LOSING THE HUMANITY OF LOYALTY? 

Tony: It comes back to making sure that emotion is central. Remember that you’re connecting with real people.  

Radha: It’s a challenging question when your brand is here to serve the nation. ​N​ot all of our customers are digitally ​active.​ ​So ​we spend a lot of time thinking about how we can connect in analogue ways as well as technology-led ways because we don’t want to leave certain parts of our population behind. Also ​t​here are ways to use technology to improve the overall experience, for example in the running of our shops or ensuring that relevant products are in stock and easy to find.  

Maria: There’s an opportunity to take the less-than-perfect chatbot experiences and turn them into conversations. LLMs can revolutionise that experience, answering your unique questions in the terms that you expect. There will be a genuine customer service revolution thanks to AI. 

ANY CLOSING ADVICE TO MARKETERS ON LOYALTY? 

Tony: Retain the humanness and the emotional connection. Understand your customers to the nth degree and know what’s going to ​always ​pull them in.  

Maria: Be clear on what you stand for and the way that you want your customers to feel. Know the core elements of your brand. In our invisible world, it is our colour, our logo, it might be our ambassador. Those are sacred and you must make them clear everywhere.  

At the end of the day, all marketing is customer behaviour change. You need to know the human on the end of it, but you also need to understand that you’re changing human behaviour. Sometimes we focus on clicks but forget that clicks are really decisions. So know who you are and work through how that appears everywhere.  

Radha: My parting thought would be fight for the fun because things can get very transactional and mechanical. Thinking about where you’re bringing the joy and creating the emotion is really important.  

CURIOUS TO KNOW MORE?

If our BrainyBar panel has left you wanting to know more about brand loyalty, get in touch with our host Dr Cristina de Balanzo.