Difference Between Brand Loyalty and Customer Loyalty

The key difference between brand loyalty and customer loyalty is that brand loyalty is customer’s attraction to the brand regardless of the price while customer loyalty is the overall spending power of customer and relates to loyalty programs, which save money and provide discounts for the customer.

Customer loyalty and brand loyalty are closely related, and both concepts are equally important in customer retention. Therefore, marketing strategies and campaigns are designed to nurture brand loyalty and customer loyalty.

CONTENTS

1. Overview and Key Difference
2. What is Brand Loyalty 
3. What is Customer Loyalty
4. Relationship Between Brand Loyalty and Customer Loyalty
5. Side by Side Comparison – Brand Loyalty vs Customer Loyalty in Tabular Form
6. Summary

What is Brand Loyalty?

Brand loyalty refers to the repetitive purchase of a specific product by customer ignoring competitive alternative products of other companies. For instance, some people will always buy Sprite instead of Seven-up at grocery stores.

Markets are equipped with most established brands in a highly competitive market along with old and new products, many of them unique. However, loyal customers are the ones who will purchase the product irrespective of the price.

Marketing professionals in companies apply many strategies to create and maintain brand loyalty. As a result, they follow consumer buying trends closely and build relationships with consumers through customer service. A successful marketing campaign will highlight a unique feature of the product to create brand loyalty to the product.

What is Customer Loyalty?

Customer loyalty refers to customer’s devotion to a company or a brand and how strongly they tend to purchase the same product or select the same company. In other words, it is the consistent positive impression of the consumer towards a particular company’s product or service depending on the physical features, satisfaction and perceived value on experience. Building and maintaining a positive customer relationship is one of the goals of today’s business organizations.

Customer satisfaction is proportional to customer loyalty. In both aspects, customers are content with the provided service or product features and are not willing to switch to another brand or a company. Meanwhile, maintaining the existing set of consumers is less costly than creating new consumers. Customer experience management is the most cost-effective way to drive customer satisfaction, customer retention and customer loyalty.

One of the benefits of customer loyalty is that it reduces the costs involved with consumer education and marketing. However, in terms of customer loyalty, customer experience management proves is a sustainable competitive advantage. Today, many businesses use loyalty programs to retain loyal customers. These loyalty programs provide lower prices than competitors or offer better discounts for customers, which ensures that they keep coming back to the business.

What is the Relationship Between Brand Loyalty and Customer Loyalty?

Customer loyalty and brand loyalty are closely related since both concepts are equally important in customer retention. Thus, businesses should target to achieve both these concepts. Also, both customer loyalty and brand loyalty are consistent, positive feelings of customers.

What is the Difference Between Brand Loyalty and Customer Loyalty?

The key difference between brand loyalty and customer loyalty is that customer loyalty is the overall spending power of customer and relates to money-saving approaches whereas brand loyalty is the customer’s attraction to the brand regardless of the price.

In general, customer loyalty relates to offering goods and services which suit the market’s financial needs and budgets. Furthermore, to achieve a high level of customer loyalty, the companies need to offer special discounts, promotions and right pricing to the consumer. On the contrary, brand loyalty is about how customers recognize the brand and how company owners establish an everlasting positive impression in the customer’s mind. Another difference between brand loyalty and customer loyalty is their marketing strategies. To instil customer loyalty, marketers should understand the buying power and financial capability of consumers. Accordingly, marketers offer discounts and design promos.  However, to instil brand loyalty, marketers should give customers great service plus high quality.

Moreover, customer retention strategies are also different for the above concepts. Customer loyalty is harder to retain, and the marketers should have thorough experience in raising and lowering prices to capture loyalty. On the other hand, it is comparatively easier to retain brand loyalty if the company consistently provide a great service. Furthermore, with brand loyalty, companies may sell fewer products with high-profit margins, whereas with customer loyalty, companies may sell many products with fewer profit margins.

Summary – Brand Loyalty vs Customer Loyalty

The key difference between brand loyalty and customer loyalty is that brand loyalty is customer’s attraction to the brand regardless of the price while customer loyalty is the overall spending power of customer and relates to loyalty programs, which save money and provide discounts for the customer. Both these concepts are equally important in customer retention.

Reference:

1. “What Is Customer Loyalty? – Definition: Meaning: Example.” My Accounting Course, Available here.
2. Kopp, Carol. “Brand Loyalty: What You Need to Know.” Investopedia, Investopedia, 12 Apr. 2019, Available here.

Image Courtesy:

1. “French brands” By Peter Guo (CC BY-SA 2.0) via Flickr
2. “Customer journey with touchpoints English” By Nick Nijhuis – Own work (CC BY-SA 4.0) via Commons Wikimedia