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Brand matters. That’s what almost two-thirds of consumers (63%) told us when we asked what influences holiday shopping decisions. Ultimately, shoppers define a brand by the overall experience it provides.
Bound up in that experience are a variety of factors — from speed, convenience and price to quality, reliability and consistency. Give your customers that overall experience they’re looking for and they will keep coming back.
A loyalty program they value, for example: 58% of travelers will redeem rewards to book travel this holiday season. What do they value most in a loyalty program? Flexibility in redeeming rewards.
Recognizing the importance of customer loyalty, more than 60% of executives increased their loyalty budgets during their most recent planning cycle, according to PwC’s 2023 Customer Loyalty Executive Survey.
Who defines loyalty? And how?
Taking their cue from consumers who signal a willingness to adopt generative AI (GenAI), consumer-facing companies are embedding AI and GenAI into their business models. Hospitality companies are boosting tech investment to enhance guest experience.
Executives are all too aware of the importance of customer experience. When it comes to earning loyalty, however, executives and consumers don’t always agree: Twice as many executives as consumers believe that good customer service is the key to winning loyalty.
Consumers, by contrast, say loyalty is won early — before they ever reach out to customer service. Almost half (46%) say the quality of the product or service drives their loyalty, while a scant 23% of executives do.
The disconnect? Loyal customers are satisfied customers who have little reason to contact customer service in the first place. The central lesson here? Be proactive with loyalty. By satisfying customers throughout the various touchpoints of their experience with your brand, you can unlock growth.
Why it matters: Think of loyalty as a growth engine that drives your most valuable customer relationships from the top of the funnel through to repurchase. Rewards members spend more. They return more often. And they serve as powerful advocates, spreading the word to their friends and families.
Consumers and executives differ on when loyalty is won
Executives
Consumers
Q: At what stage of the customer journey do you think customer loyalty is either won or lost? (Select one)
Source: PwC Customer Loyalty Executive Survey 2023: base of 410
Q: When did you decide you would keep using or buying from that brand? (Select one)
Source: PwC Customer Loyalty Survey 2022: base of 3,378
Source: PwC Customer Loyalty Executive Survey 2023: base of 410
Q: When did you decide you would keep using or buying from that brand? (Select one)
Source: PwC Customer Loyalty Survey 2022: base of 3,378
Know who your loyal customers are — and what they care about
Various consumer groups illustrate nuanced versions of loyalty, according to PwC’s 2023 Holiday Outlook:
- Men are more brand-loyal than women (67% vs 59%), for example.
- Millennials — who have the largest holiday spending budgets this year — are more likely than Gen Z to belong to a loyalty program (62% vs 50%).
- However, when Gen Z consumers do belong to a loyalty program, they outperform: 81% (vs 69% overall) browse at and 82% (vs 73%) buy from their favored brand or retail site.
Emtechies are another loyal consumer group. They consist primarily of young male high-earning consumers in metro areas who embrace emerging tech — such as GenAI and extended reality — to augment their shopping and travel experience:
- 71% belong to a loyalty program.
- 83% are more likely to travel this holiday season (vs 47% for non-emerging-tech users).
- 74% plan to redeem rewards for holiday travel (vs 46%).
Why it matters: Given their income level — more than half earn over $65,000 — and extremely online presence, emtechies are a group to watch. And nurture. As are Gen Z consumers, who will soon enter their peak earning years.
Emtech users illustrate enviable loyalty
Emtechies
Nontechies
Q: Are you a member of the loyalty program of a brand?
Base: 4,011; Emtech users: 868
Q. Do you also have one of the brands credit cards?
Base: 2,286; Emtech users: 619
Q: Does owning this credit card determine where you start to browse or shop for products & services?
Base: 1,217; Emtech users: 457
Source: PwC Holiday Outlook 2023
Base: 4,011; Emtech users: 868
Q. Do you also have one of the brands credit cards?
Base: 2,286; Emtech users: 619
Q: Does owning this credit card determine where you start to browse or shop for products & services?
Base: 1,217; Emtech users: 457
Source: PwC Holiday Outlook 2023
Amplify the reach of your superfans
The metrics are in: Loyal customers not only spend more with a brand, they also spread the gospel of the brand far and wide. These superfans are worth cultivating because — in addition to their own allegiance — they amplify a brand’s reach.
Analytic models can help decipher the reasons for their preferences and behaviors, Armed with that information, you can better personalize interactions and rewards in ways that further encourage loyalty. It’s time to take your loyalty function to the next level by transforming it from a retention tool into a growth engine.
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