When it comes to brand loyalty, Amazon ranks number one.
The e-commerce giant topped Brand Keys’ recently published Loyalty Leaders List. The global brand research consultancy said loyalty reflects the consumers’ willingness to spend. “Brands that have made loyalty and emotional engagement a strategic priority always appear high on the Loyalty Leaders List. More importantly, they always appear at the top of consumers’ shopping lists,” Brand Keys founder and president Robert Passikoff said.
The firm found that digital technology, social networking brands and brands that engage in digital activity represent more than a third (36 percent) of the top 100.
“Since 2000 it’s been more difficult for non-digital or non-social networking brands to increase engagement that resonates with consumers’ emotions and builds loyalty. We predicted this precise situation would force traditional brands to work harder to create the emotional connections necessary to foster loyalty,” Passikoff said. “Some have worked harder recently, with traditional brands using more digital and social outreach to boost brand loyalty.”
Amazon rules loyalty’s ‘rule of six’
Companies are battling aggressively for brand loyalty but none more than Amazon, which seems to understand one thing in particular: hook consumers once and you can have customer forever.
It’s what Brand Keys calls the Rule of Six, which means a happy customer is six times more likely to opt for your brand in additional categories as well. It’s why Amazon not only dominates the overall loyalty list but three specific categories: online retail, tablets and video streaming.
Passikoff said the Rule of Six loyalty then “makes it harder for other brands—in and out of those categories—to break into the top 20.”
Apple, too, appeared on multiple lists, placing #3 for tablets, #5 for smartphones and #22 for computers. Other digital brands that made the list included Google (#2) and Netflix (#4).
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Traditional brands gain ground in consumer loyalty
Digitally native brands may be resonating with consumers but not to the exclusion of traditional companies.
“Interestingly (16 percent) of the brands that made the 2017 list moved up more than 20 positions,” Passikoff said. “And while digital and social brands have held their positions at the top of the list, the number of ‘traditional,’ non-digital, non-social brands have doubled in the 2017 Brand Loyalty Leaders List top 20.”
After placing in the 83rd spot on 2016’s list, Forever 21 climbed 46 spots to #37 this year. Brand Keys attributed Forever 21’s success to the retailer’s extensive social media presence and its ability to concisely communicate with its Gen Y and Gen Z audience.
Nike, which nabbed the 12th spot and fell under the athletic footwear category, climbed up three spots from 2016. New Balance, another popular footwear brand, went from #65 last year to #53 on the list this year.
Fast fashion leader Zara made its debut on the list at #89—replacing two retailers that fell out of the top 100 this year—Gap and J.Crew.
The only department store on the list was T.J. Maxx at #73.
Consumer loyalty remains a challenge for some brands
While some brands boosted their rankings, others achieved the opposite results.
Under Armour lost the most consumer loyalty ground this year—falling from #28 to #51 on the list.
Most apparel retailers didn’t climb up the consumer loyalty ladder either. Ralph Lauren, although topping the apparel retailer category, ranked #29 on the list this year, falling from #24 in 2016. Old Navy, which placed #50 on the list in 2016, dropped 20 spots to #70 this year. Victoria’s Secret achieved a slightly lower ranking as well—dropping from #58 last year to #61 in 2017.
With the competitive retail and e-commerce landscapes, brands will have to ramp up their consumer loyalty efforts to stay relevant and secure growth in the future.