Our fifth annual Retail Customer Brand Loyalty Study reveals how consumer shopping behaviors and preferences have changed since 2021.
- Retail customer loyalty rebounded in 2022, with more customers reporting that they prefer to consistently shop with the same retailer.
- While price is an important factor affecting customer loyalty, receiving a good value and ease in making purchases actually have greater impact for the majority of consumers.
- Understanding the factors that are important to customers with different shopping personalities can help retailers determine how best to prioritize resources and budget.
- As the pandemic appears more under control, customers continued to indicate that their spending habits are now swinging closer to “not changed at all” and are more balanced between “buying essentials only” and “buying whatever I want.”
Earlier this year, we conducted the 2022 Retail Customer Brand Loyalty Study to discover new insights about factors affecting customer loyalty. It was a happy surprise to find that the customer.com study showed retail customer brand loyalty is rebounding after taking a step back in 2021.
In 2022, the percentage of Loyalists — consumers who consistently shop the same retailer — rose to 38%, up from 35% in 2021. Starting in 2018, retail consumer loyalty had been steadily growing, peaking in January 2020 at 39% — prior to the COVID-19 pandemic striking in force a few short months later. On the other end of the spectrum, the group of customers who indicate that they prefer to shop around before making a purchase shrank from the all-time high of 36% in 2021 to 33% in 2022.
How else did brand loyalty shift since last year? Read on for more study highlights, including an overview of factors influencing brand loyalty.
Want the full report? Download your free copy of the 2022 Retail Customer Brand Loyalty Study.
Background on the 2022 Retail Customer Brand Loyalty Study
To gather the 2022 customer loyalty statistics, our survey probed 1,060 consumers about their loyalty to retailers and the factors that influence brand loyalty. It addressed these critical questions:
- When all things are equal, which factors drive customers to shop exclusively with a particular retailer?
- Which factors are most important to “super loyal” customers versus consumers who always shop around?
- How has the COVID-19 pandemic affected customer brand loyalty and spending habits?
- Which factors influence a non-loyal customer to shop exclusively at a particular retailer — in other words, what would make them more loyal?
- Do consumers show tendencies to be more or less loyal based on demographics?
- Which retailers make loyal customers out of customers whose style it is to shop around?
Customer Brand Loyalty Rebounds in 2022
As we noted above, retail customer loyalty rebounded in 2022, with Loyalists increasing to 38% in January 2022 after dipping to 35% in January 2021.
The study also collected data on more than 700 individual U.S. retailers representing every retail category. Walmart continued to top the list of retailers named most frequently as the one consumers prefer to shop exclusively. In fact, the mega-chain has steadily increased its lead over the next closest retailers — Amazon, Target and Kohl’s. Interestingly, the composition of the top 50 retailers remained relatively the same as in prior years.
What affects customer loyalty?
Looking across shopping personalities, we discovered specific factors that influence customer loyalty, driving consumers to shop exclusively with certain retailers. Understanding these loyalty factors can give you crucial insights into how to position your organization in relation to those global competitors like Walmart and Amazon, as well as in relation to direct competitors. They can help your organization determine how best to target and prioritize resources and budget. And, of course, they can give you important information to guide your customer retention and loyalty efforts.
According to the loyalty statistics from our study, the factors influencing customer loyalty among different shopping personalities are broad and encompass the entire retail enterprise. Loyalty factors listed by consumers ranged from the tangible, such as receiving incentives to shop, to the intangible, like trust or viewing shopping a particular retailer as a status symbol.
And our most recent study clearly demonstrates again this year that while lowest price is a factor that influences brand loyalty, receiving a good value and ease in making purchases actually have greater impact for the majority of consumers. In fact, in 2022, lowest price remained sixth in our list of most frequently picked loyalty factors. And there are even more intangible factors that ranked higher than price and have a significant impact on customer loyalty, including positive shopping experience and trust.
When asked which factors would encourage them to select one retailer over another if access, products and price were equal, the respondents’ top answers were not surprising and, for the most part, remained closely aligned with last year’s preferences. However, the importance of receive incentives to shop came roaring back into the top five, replacing easy to make returns.
Spending Habits Return to Normal
Our longitudinal study is fielded in January each year. But when the pandemic hit, we felt compelled in April of 2020 to begin gauging its impact on consumer spending habits. When we fielded our loyalty study in January of 2022, we incorporated questioning around consumer spending habits and how they had changed due to the pandemic.
As of January 2022, we are seeing definitive signs that consumer spending habits are heading back to normal. Compared to January 2021, scores have continued to swing toward my spending has not changed at all and buying whatever I want for the previous 12 months. That said, only time will tell how much spending habits will change again if inflation continues to increase.
In January 2022, when asked How have your spending habits changed over the past year, Loyalists responded that their spending has not changed at all (versus 2021, when they were more likely to respond that their spending had changed drastically). Roamers were more likely to indicate that they preferred to shop physical stores.
The study also revealed notable variances from different demographic groups. For example, respondents aged 55 and over were more likely to report their spending had changed drastically this past year, while respondents aged 54 and under were more likely to report no change to their spending habits — the opposite of how these age groups responded in 2021.
Factors Affecting Customer Loyalty Matter to the Entire Organization
One critical point that our customer loyalty study drives home is this: While retail loyalty programs influence customer retention, there are many other compelling factors that influence customer loyalty to particular stores. Much to the dismay of retail organizations struggling with customer retention, loyalty programs alone cannot fix sales and traffic issues related to a poor product offering, customer experience or any other countless business issues.
Building customer brand loyalty requires that you understand and act on influential loyalty factors in a way that will resonate with all shopping personalities. This requires enterprise-wide support from all aspects of your business — from customer-facing personnel and technologies to the back-office staff and processes that support them. A broad-based effort like this is absolutely key to meeting your retail loyalty and retention goals.
For deeper insights and year-over-year comparisons on the factors influencing customer loyalty, get a free download of customer.com’s 2022 Retail Customer Brand Loyalty Study.
Digging into shopping behavior insights and creating strategies to build and maintain customer loyalty is what we’ve been doing at CCG for the past four decades. Learn more about the retail marketing solutions we offer and how our retail marketing consultants can help you reach your goals. Schedule a free consultation today or call us at 303.986.3000.