Jonathan Hurvitz
Jonathan Hurvitz

Customer loyalty: Rather get a dog?

by Jonathan Hurvitz. Today’s customer is not the same customer as five years ago. There is a need for a holistic, customer-centric approach, which translates into a consumer-first shopping experience.

by Jonathan Hurvitz. They say that if you want loyalty, you should get a dog – which implies that humans just aren’t wired for loyalty. Yet for years we’ve talked about brand loyalty as a type of gold standard for customer retention, and businesses have spared no effort in ensuring their offering generated the desired loyalty.

But increasingly, it seems that customer and brand loyalty are becoming an outdated concept. In fact, this Forbes article raised the question of whether customer loyalty is dead and concluded that, while it may not be gone, it has certainly evolved. It is this evolution that is worth taking note of, particularly as we plan for 2022, keenly aware of the fact that the pandemic has had a profound impact on the once-watertight notion of customer and brand loyalty.

The decline in customer loyalty is happening across industries and, while reasons for this range from price to poor customer service, the reality is that customers today are spoilt for choice when it comes to the goods and services they need and desire. Research has found that “increasing competition and multiple choices make customer loyalty an impossible phenomenon”, which implies that we need to shift our focus and consider what the customer loyalty equivalent is for 2022.

As a first step, let’s acknowledge that loyalty is elusive and focus rather on understanding the evolving needs of the customer by drawing on data and more clearly defining how we offer value. Loyalty is the reward for value, but the challenge is to ensure the value proposition evolves in line with industry trends and customer expectations.

Evolution of the customer 

Today’s customer is not the same customer as five years ago. In fact, a McKinsey & Company report says, “retail has experienced more change over the past five years, than in the prior 50 years”. We’re a lot more tech savvy and expect far more from brands in terms of tailoring their offering to meet our exact needs at the exact point in time that we need them to be met. For a business this means forgetting the ‘build and they will come’ mentality; and working instead to understand the needs, frustrations and aspirations of their customers and ensure that their strategic and operational capacity is such that they can respond to these needs timeously.

Look first to data 

One of the most important ways a retailer can do this is by becoming a data-driven enterprise that relies on analytics to inform planning, decision-making and more. They say the numbers don’t lie, and since retailers can’t afford to lose any numbers (be that customers, revenue or market share), the strategic incorporation of data and analytics into everyday operations is going to be more crucial going forward. The New Retail Operating Model of the Future, a study published by Deloitte last year, highlights that the goal for (online) retailers is to become more consumer-centric and to operate more efficiently. Efficiency is different for every business, even within the retail sector, but what is true across the board is the need to be agile and able to react to shifts in the market swiftly.

Data – simply information about customers, trends, revenue and market share must form an integral part of the overall business strategy. The Deloitte study also talks about the danger of “disconnected departmental thinking”, thus emphasising the need for a holistic, customer-centric approach, which translates into a consumer-first shopping experience.

Long live loyalty?

Consistently meeting (and exceeding) customer expectations, and offering real lifetime value, is today’s formula for encouraging loyalty. Loyalty is alive and well, but brands need to work far harder for it than they’ve ever had to in the past. And that’s a good thing because it forces us to keep improving, to keep innovating and to ensure we remain in touch with the needs of our customers as real people.


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Jonathan Hurvitz is the Group CEO of online retailer Teljoy and  a registered Chartered Accountant in South Africa.




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