Impact of COVID-19 pandemic on customer loyalty

We all know that the pandemic affected most industries, including retail. However, its impact wasn’t just due to restrictions which meant closed stores and lower sales. Recent stats show that it also had an impact on customer behavior, especially on customer loyalty. 

TruRating’s poll showed that 75% of the 33,000 customers changed the brands they buy due to COVID-19. In this article, we are going to talk more about the impact of the pandemic on customer loyalty and the reasons for which customers changed brands.  

What is customer loyalty?

Before we get started, let’s talk a bit about customer loyalty in general. What does customer loyalty mean? How do brands and retailers manage to turn regular customers into loyal ones? 

Customer loyalty is the ongoing positive relationship between a customer and a brand. This relationship drives repeated purchases and makes shoppers choose your brand or business over your competitors. Customer loyalty is not easy to achieve, especially for FMCG brands. While there are some brands that everybody knows and loves, most FMCG brands have a harder time gaining loyalty. 

However, people don’t usually change their favorite brands. We are creatures of habit and when we like something it’s hard for us to choose something different or even try out an alternative product. However, something changed when the pandemic started out. 

How and why did COVID-19 affect customer loyalty?

The first thing that changed was that people stopped going to shops, especially since most of them were closed. However, even the ones that were opened didn’t have as many customers as usual. People tried out online shopping and appreciated the convenience. Actually, there was a surge in online shopping and BOPIS options. 

While COVID-19 seemed like it put the world on pause, people still needed various products. This was the moment when people started to change their options when it came to their favorite brands and retail stores. 

Instead of going to the same shop they used to, they started shopping online. Instead of buying their favorite brands, they bought what was available and with free delivery. One of the main reasons for which customer loyalty declined was the necessity. 

Another reason for which people switched to different brands or stores was convenience. Shoppers want a convenient, frictionless experience. No matter if it is an in-store or online experience, they want to get the products they want quickly and easily. During the pandemic, many people stopped shopping from their favorite stores because they did not have a BOPIS option or even an online presence.

However, things seem like they are slowly getting back to normal and it is time for retailers and brands to try to win back their shoppers and turn them into loyal customers. Let’s see how they can do that.

Tips and tricks on how to increase customer loyalty

1. Offer a frictionless experience

If you are a retailer, then you need to find a way to make the shopping experience frictionless. There are a few touchpoints in every customer journey that are always problematic. For example, checkout lines. People are frustrated with long waiting lines. Try out self-checkout and contactless/mobile payments to make sure that the line moves faster. 

2. Create an emotional connection

It’s important to understand the need for human interaction. People don’t buy from brands or retailers, they buy from other people. Retailers, train your staff to communicate with customers and offer them the best tips. Brands, try storytelling and influencer marketing so that people can put a face on the brand and create an emotional connection with you. 

A brand activation campaign could also be helpful. When done right, brand activations make people change or improve their perception of the brands. Also, it can help create an emotional connection between customers and your brand. 

3. Increase customer engagement 

Another important thing you need to do is to increase customer engagement. People want to be entertained when they step into the store and they like brands that engage with them. Try out robotic POP displays, event marketing, and retailtainment to better engage your customers. 

4. Innovate and adapt constantly

If you don’t innovate and adapt, you will lose customers. Once people feel that their needs are not satisfied or that they can find better services elsewhere, they will go to the competition. However, if you adapt and find innovative solutions, you will be able to please even the most demanding customers. 

COVID-19 affected businesses all over the world and changed the way people shopped. This doesn’t mean that retailers and brands should just give up. They need to find better ways to keep their customers engaged, offer an amazing experience, and always adapt.

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