While many have referred to the death of the high street and retail in relation to Covid-19, it’s interesting to note that the global ecommerce market has bloomed in recent months.
This is particularly true in the U.S., where online retailers’ year-on-year revenue growth was up by 68% as of mid-April.
Overall, there has been a 129% year-on-year growth in U.S. and Canadian ecommerce orders as of April 21st, while online conversion rates also increased by an impressive 8.8% in February alone.
Of course, this has continued a long-term trend in the retail space, with 2019 seeing online spending increase by 14.9% in relation to the previous year’s figures. This has undoubtedly changed the way in which brands look to build consumer loyalty, but how is this process likely to evolve further in a post-Covid world?
The Importance of Brand Loyalty and its Constantly Changing Nature
The Covid-19 pandemic has arguably challenged the concept of brand loyalty in a unique way, as customers have been forced to turn their backs on certain brick-and-mortar brands in order to seek out viable alternatives online.
Of course, this is not an issue for online or multichannel brands, but there’s no doubt that the recent outbreak has dramatically changed consumer behaviour and encouraged online retailers to revisit the importance of securing brand loyalty.
This should already be a significant focus for online retailers, thanks to the incredibly competitive nature of the ecommerce markets and especially niches such as fashion, consumer electronics and (increasingly) groceries.
However, companies will need to channel and refine their efforts even further in the near-term, as a growing number of business transition online post Covid-19 and global ecommerce players such as Amazon creating digital real estate for fashion designers.
How to Inspire Brand Loyalty in a Post-Covid 19 World
We’ve spoken about consumer behaviour, and it’s important to note that this is driven by the underlying human condition.
This enables brands to take stock of the unprecedented changes and disruptions that customers are experiencing in the course of their everyday lives as a result of Covid-19, before reinventing the existing consumer journey and precise evocation of loyalty.
In the current climate, for example, brands may benefit by leveraging temporal discounting research to create urgent and real-time rewards, while also focusing on competitive pricing as a way of rewarding loyalty and respecting the customer’s tendency for loss aversion.
While competitive pricing is key, however, it’s important not to become obsessed with this metric when looking to inspire brand loyalty.
The reason for this is simple; as the ecommerce market makes it easier than ever for discerning shoppers to compare hundreds of prices in a few clicks, and developing a narrow focus on price points will simply create a race to the bottom where big players like Amazon inevitably win.
This is where loyalty programs come into play, as this prevents you from competing solely on price by introducing new and rewarding ways to differentiate your brands.
There’s tremendous scope for innovation here, whether you want to create an enhanced and emotive customer journey around your products or introduce rewards for a wider array of consumer actions (such as referrals or recommendations).
These points of difference will prove crucial in a post-Covid world, as thousands of brands will be discounting prices in the immediate aftermath of the pandemic. Make no mistake; slashing prices is not enough to build brand loyalty in such a climate, and you’ll need to delve deeper into the human psyche to achieve this objective going forward.