Today’s podcast is with Sara Richter, CMO at SAP Emarsys, a leading omnichannel customer engagement platform provider. Sara joins me today to talk about customer loyalty, the findings emerging from the 2024 edition of their Customer Loyalty Index (CLI) report, the five different types of loyalty that marketers and CX professionals should be thinking about, and what brands should be doing to engender (true) loyalty with their customers.

This interview follows on from my recent interview – Harnessing the contact center’s potential as a real-time data gold mine – Interview with Suvi Lindfors of Netigate – and is number 533 in the series of interviews with authors and business leaders who are doing great things, providing valuable insights, helping businesses innovate and delivering great service and experience to both their customers and their employees.

NOTE: Today’s episode is sponsored by Qualtrics, ahead of X4 2025: The Experience Management Summit, which is taking place in Salt Lake City on March 18th-20th. It’s set to be an unforgettable event designed to empower you and your organization in leveraging Experience Management (XM) to enhance customer and employee satisfaction, reduce operating costs, and achieve remarkable breakthroughs. There, you will hear about some of the best customer experience programmes from industry leaders and companies, including Autodesk, Ford, USAA and Hilton. Find out more and register now at the Qualtrics website.

Here are the highlights of my chat with Sara:

• Current data suggests that it is somewhere around 5x more expensive to acquire a new customer versus retaining one.
• We found ourselves looking at loyalty in terms of five types. Ethical, true, incentivized, silent, and inherited.
• Ethical loyalty has gone up 53% since we started in 2021.
• True loyalty has actually risen by 93% since 2021.
• 83% of people still feel that their loyalty isn’t valued by brands.
• The five types of loyalty:
  • The first one is incentivize, which is about offering customers discounts and incentives, rewards etc in exchange for their loyalty.
    • 38% of the 16 to 24 age bracket are motivated by incentivized loyalty, whereas it is 53% in the 45 to 54 age bracket.
  • Inherited loyalty – that’s based on a brand’s heritage or longstanding associations.
  • Silent loyalty is loyalty that you won’t express.
  • Ethical loyalty is exactly what it sounds like and is based around a real alignment to social values and ethical values and how a brand stands up and is counted around issues that matter.
  • True loyalty is that really binding holy grail love that you feel for a brand.
• Brits are now 24% more loyal to brands that are committed to sustainability.
• Overall loyalty peaked in 2022, but more recently is down.
• Within the five different types, there’s only two of the five types that have grown consistently since we started the research in 2021 and they are true loyalty and ethical loyalty.
• If true loyalty is increasing, then marketers and brands are actually getting better at building relationships with individuals.
• Of the five types of loyalty, the only one that has faced a downturn is Incentivized. Why? Because increasingly, you cannot buy loyalty.
• The US actually reports more true loyalty respondents versus the UK: 39% versus only 27% in the UK.
• Sara’s best advice: Be more personal, be more human.
• Sara’s Punk CX brand: John Frieda

About Sara

Sara brings nearly 20 years of marketing experience to her role as CMO at SAP Emarsys, a leading global marketing team focused on delivering exceptional AI-driven customer experiences. Passionate about building revenue-oriented marketing teams that act as a trusted partner to commercial organizations, Sara creates dynamic, differentiated messaging and generates revenue opportunities that high performing, growing businesses need to achieve objectives and exceed expectations.

Check out the 2024 edition of the Customer Loyalty Index (CLI) report, find out more about SAP Emarsys here, and feel free to connect with Sara on LinkedIn here.

Credit: Photo by Yurii Stupen on Unsplash