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Learn how to find a special place in your customers' hearts

Emotional Loyalty: Art or Science?

Have you ever felt truly connected to a brand? Purchased their products not because they were on sale, but because it felt like the natural thing to do? Have you even gone out of your way to convince your friends to buy from them? Why? Probably because you were totally aligned with that brand. Because they recognized you as more than just a buyer. They understood you, and together you formed precious memories. As a result, a real connection was born, and it’s called emotional loyalty. It’s the most powerful bond a brand can build, so why not focus more on it? Why not build everything – including your loyalty program – around it? The question is, can you even have a blueprint for emotional loyalty…

Speaking of designing a loyalty program, did you know that your concept document should always be longer than a single page? If you don’t want to miss out on any of the important aspects, download our handy concept design worksheet.

What Is Emotional Loyalty and Why Is It So Powerful?

At its core, emotional loyalty is a form of commitment built between the customer and the company. It can be built on a memorable customer journey, authenticity, shared values, and high-quality service. Once in place, emotional loyalty needs to be strengthened, rewarded, and activated time and time again.

Even though the idea of forming bonds with customers has always been around, emotional loyalty as a concept took off after a 2015 research published in the Harvard Business Review. It proved that over time, customers who reach the pinnacle of the brand emotional connection scale bring 52% more value than customers, who are “just” highly satisfied. And this powerful lesson holds true to this day. In fact, 71% of customers with an emotional connection to a brand are willing to recommend it to others.

What about features and prices though? Doesn’t a competitive pricepoint overshadow an emotional attachment? On one hand, there obviously is a breaking point and additional value that will sway shoppers. On the other hand, a 2022 research shows that emotional attachment is a highly significant driver, and is responsible for 43% of business value.

KFC UK & Ireland wanted to serve their loyalty program members an unforgettable arcade-like experience in the form of a minigame, where participants could win 12 finger-lickin’ rewards. For more, check out our case study

Brand Affinity vs Brand Loyalty – Not the Same, No Matter What They Say

When talking about the results of emotional loyalty, brand loyalty, and brand affinity are often used interchangeably. But are they really the same? Not exactly.

Think of this as a hierarchy:

  • Step 1 – Brand affinity: It entails an emotional alignment with a brand. People (not customers yet!) feel positively towards the brand, like their ideology, the products they showcase, etc. But! That’s where it ends. There is an inclination towards maybe one day purchasing from them, but no actual transactions.
  • Step 2 – Brand loyalty: This is where customer experience comes into play. Here we’re talking about how customers (not just people in general) feel and act toward the brand. Emphasis on action, because the premise for brand loyalty is repeat purchases, active engagement, and clear preference over competitors. It’s a connection worth building on.
Rare Beauty’s success was built on forging a genuine relationship with its customers.
A modern brand, showcasing its capability to take brand affinity and forge it into brand loyalty is Rare Beauty by Selena Gomez. Connecting with Millennials and Gen-Z, the company built on self-love and finding joy in makeup neared $300 million dollars in revenue, despite being only 3 years old.

Transactional Loyalty vs Emotional Loyalty – Is It Even a Competition?

This begs the question: will emotional loyalty ever replace old-fashioned transactional loyalty? Where the relationship is built on benefits, like coupons, discounts, points, or cashback offers? Well, yes… but also, no. Let’s just say that the future will be much more “emotional”.

Let’s take loyalty programs as an example. In our Global Customer Loyalty Report 2024, we learned that 52.0% of respondents who plan to launch a loyalty program in the next two years envision it as more emotional than rational. Therefore, there will be a lot more reward programs in the future that focus on relationship-building instead of loading up members with vouchers.

Nevertheless, remember: it might be emotional loyalty that keeps customers around, but rational loyalty will be the one that attracts them to you in the first place. So you can never get rid of one or the other. Instead, aim to balance the two!

Report statistics about the current landscape of loyalty programs in 2024 from Antavo’s Global Customer Loyalty Report 2024.
The report also points out that currently, the rational sentiment still dominates the discussion about loyalty, but it’s going to change as the interest slowly shifts. 

How Do You Build and Nurture Emotional Loyalty? – Where Emotion Meets Science

To achieve the best possible results you need a two-step approach (just like for an evening skincare routine). The first step is to create a customer-focused business model that evokes the feeling of loyalty and commitment. The second step is to create an engagement system, like a loyalty program, that allows you to identify and activate your most dedicated customers.

Step 1: Build a Solid Foundation by Being Authentic and Utilizing Customer Insights

  • Be authentic and coordinated in communicating and highlighting your brand values.
  • Utilize the information you have.
  • Actively gather customer insights.
  • Make sure that every aspect of your brand is centered around your customers.

Calzedonia’s ‘Every step is a step forward’ messaging is the perfect example of what a brand understanding and supporting its customers should look like. 

Step 2: Identify, Elevate, and Nurture Loyal Customers With a Loyalty Program

Once you’ve created the perfect foundation to initiate your customers’ loyalty, you need to make sure to identify and reward them. How can you achieve this?

The most infallible way is to implement a loyalty program:

  • Identify your most loyal customers with next-gen loyalty platform insights and reporting capabilities.
  • Elevate them by offering emotion-centric priority perks.
  • Align yourself with shoppers on an emotional level by showcasing genuine brand values and actions.
  • Nurture their long-term, active (emphasis on “active”) commitment through experiential features.
Ray-Ban’s loyalty program is built on a sense of exclusivity.
Ray-Ban’s loyalty program The Ones enhances the sense of exclusivity and luxury with special collections, where only loyalty members can acquire limited-edition products.

The Gen-Z Factor: Achieving Brand Commitment Through Emotional Loyalty Programs

Is loyalty an emotion that matters to Gen-Z? Given how much they value authenticity, transparency, trust, and personalized messaging, it’s safe to say that yes, loyalty definitely matters to the younger generation. Let’s take it one step further: But what about loyalty programs? This is where things get a little more complicated. In the UK, for example, while 79% of Gen-Z customers love the idea of loyalty programs, only about 50% of them are actually signed up for any loyalty program.

So why the lack of commitment, and how can you encourage Gen-Z customers to take the final step and truly commit to you? The key is to build an emotional connection that aligns with their value (sustainability, diversity, equality), their shopping habits (both in-store and mobile), and their utmost demand from brands (quality, authenticity, and personalization).

New Balance emphasizes craftsmanship and sustainability.
Piper Sandler’s recent Taking Stock With Teens® Gen-Z survey once again underscores how much this generation’s core value-brand alignment impacts their purchase decisions. The brands that came out on top – like New Balance – showcase their efforts towards sustainability, charity, community building, and celebrating individuality.

How Emotional Loyalty Programs Captures The Hearts of Gen-Z:

  • Personalize all offers: VML’s famous Trend Report states that 73% of Gen-Zers want to purchase from brands that understand them. To demonstrate this, brands need to ensure they customize both their communication and loyalty program offers.
  • Incorporate true values into your reward system: Gen-Z makes purchase decisions based on the values of a business. Therefore,  rewarding charitable actions, sustainable choices, and community-building efforts is very important.
  • Offer freedom of choice in how points are used: the one-size-fits-all method clearly doesn’t work for this generation. Offering a diverse selection of ways to both earn and spend points will be much more attractive to them than a single-choice method.
  • Ensure a next-level in-store experience is provided: Reports suggest that Gen-Z has essentially revitalized the mall eco-system in the States. They enjoy the community experience, so incorporate in-store games and challenges, like treasure hunts, and provide in-store services like free style advice as VIP benefits are highly recommended.
The reasons behind Gen-Z’s purchase habits.
The ultimate reasons behind Gen-Z’s purchase habits are also clear to see in Statista’s latest 2023 survey. This generation is motivated by environmental and charitable values, as well as product quality and overall worth.

4 Emotional Strings to Play in an Emotional Loyalty Program – Keep ‘Em Comin’ Back for More

When building a reward program around emotional loyalty, the most important question is: what feeling should you focus on? We’ve collected four emotions and specific reward types that will help you evoke these feelings to encourage members to keep coming back for more.

1. Surprise & Delight

Who doesn’t love a sweet surprise? Offering unexpected surprise delights during a customer’s birthday or the brand’s anniversary month will bring to life a sense of happiness that reinforces brand affinity. Plus, when granted as an unexpected treat, even coupons and bonus points can cause instant happiness. Once again, it is an emotion people will want to repeat over and over again.

  • Birthday rewards: You can’t go wrong with showing a little extra care by surprising loyal customers with a Birthday reward.
  • Free mystery samples: Based on personal experience, there is nothing more delightful than finding free samples or travel-size products when you open up your latest order, it always makes you feel a little giddy.
  • Social media contests: Why not involve your audience in fun social media (SM) activities or funny challenges? It’s a win-win situation: they get to have fun and win giveaway prizes, and you get some amazing PR recognition.
A mockup of an emotional loyalty social media contest.
With a good Instagram or #hashtag contest, you can activate a large audience of brand advocates for the price of a single grand prize. 
  • Prize wheels: Ready to take your audience for a spin? Offering prize wheels in your app will encourage people to keep coming back every day for a chance to win, building up the above-mentioned muscle reflex.
  • Personalized offers: Remember how you felt when your friends showed their knowledge of your taste and preferences? The same fuzzy feeling can be caused by utilizing the customer insights you gather in your CRM and loyalty platform to provide hyper-tailored offers.
e.l.f. Cosmetics’ Beauty Squad loyalty program focuses mainly on surprise and delight elements.
e.l.f. Cosmetics’ Beauty Squad tier-based loyalty program showcases an amazing variety of perks, putting extra emphasis on free gifts, surprise offers, birthday (Bday) delights, and personal consultation experiences, all designed to keep the program fresh, and members constantly happy and engaged in order to unlock even more amazing offers.

2. Empathy

A lot of customers, especially Gen Z, care about others. Introducing reward features where loyalty members can make the world a better place will evoke a sense of accomplishment far greater and stronger than a simple transaction ever could.

  • Reward sharing: Exchanging a sense of loss with an opportunity to share or gift a reward will go a long way towards generating goodwill and positive word of mouth both in-person and online.
  • Friend referrals: This is a win-win situation all around. By providing a friend-referral aspect to your program, both your existing and new loyalty member wins. You can offer free shipping, extra cloud storage, or no monthly fee for a certain period. This way registration comes with free gifts and a great experience from the start.
A loyalty program membership page that can be used as a template for a brand ambassador program.
Referral programs are classic for a reason: they simply work. And if they are part of a loyalty program, the benefits can be managed cost-effectively. 
  • Sustainability actions: Seeing how much customers care about sustainability while making their purchases, it’s only natural that they will also value sustainability-based soft actions to earn points. This includes actions like recycling or community service acts.
  • Donating points: Another way to forge emotional connections with your customers is to support their communities. Enabling loyalty members to donate their rewards or points to a previously selected charity will further encourage them to engage and spread the news on SM.
Delta’s Skywish enables loyalty members to use their points to help communities in need.
Delta Air Lines’ Skywish program allows SkyMiles loyalty program members to donate their air miles to selected charitable organizations. The donated miles are used by the organizations to provide travel for in-need communities, such as veterans or children seeking treatment. 

3. Passion

Bringing out your loyalty members’ active side is a sure way toward higher engagement. Most people have a naturally competitive streak, but rewarding athletic accomplishments, incorporating branded merch items, and spicing it up with in-person community and sporting events will awaken your customers’ passionate side.

  • Sports activity leaderboard: Offering sports and endurance-based challenges will make people want to engage more and more, show off their results on social media, and organically drive engagement for your brand while raking in benefits.
  • Badges & Challenges: These features combine competitiveness and build useful habits. You can build challenges where customers have to buy a shoe and run 10 miles to earn a reward. Or offer a badge for using the loyalty app all day throughout the month.
A loyalty pass showcasing the steps of a fitness-challenge.
If you are truly looking to engage with customers based on a shared passion, dedicate a special interest club to it. It’s like a loyalty program within the loyalty program. There are entry requirements but, in exchange, members enjoy elite perks. 
  • Fan merch: This might be a little more niche-specific, but nothing ignites passion faster than sports. It is an absolute must for sports clubs and athleisure retailers to incorporate fan merch as rewards. A signed item or an in-person meet and greet could be a premium or subscription feature.
  • Rewarding actions outside of the buying cycle: A lot of customers are quite loyal to the brand, even if they don’t necessarily have the financial means to repeat purchases often. Allowing them more democratic ways to earn points or advance in tiers will make them feel a lot more seen and included, resulting in a lot of goodwill.
  • Community events: Granting unforgettable in-person experiences will strengthen the sense of belonging and connection. These could be collection launch events, brand trips, community service acts, or tier-specific events with celebrities.

In its loyalty program, surfwear retailer Rip Curl came up with the genius idea to reward customers for surfing — using an integrated sports tracker. As a result, 97% of its members have made at least one purchase. Read more about it in our case study

4. Exclusivity

According to a Siegel+Gale’s World’s Simplest Brands Study, 64% of potential customers are willing to spend more for a simplified purchase experience. This result 100% translates to the field of loyalty programs. Members are even willing to pay for premium or subscription-based privileges as long as they receive special treatment for it.

  • VIP customer service or skip-the-line privileges: Evoking the sense of exclusivity will only work if the privileges your customer registers for (or pays a premium fee for) generate tangible value for them. Perks like skip-the-line or order-ahead at coffee shops, or fast-lane passes while online shopping will save them the valuable time they can spend elsewhere.
  • Early access to new launches and sales events: Think limited collections, numbered pieces, launch events, or special members-only drops, these are the perks granting the level of exclusivity loyalty members truly expect, and are willing to pay a premium fee for.
Mockup of a VIP club feature within a loyalty program that provides early access for 1000 points.
Special privileges make customers feel special and valued – even if they have to pay for it in currency or points. 
  • Members-only perks: These could be services or products as well. The important element to keep in mind is to make it truly exclusive, or limited to your most loyal customers. Examples could be limited-edition items or high-ticket culinary or wellness retreat experiences.
  • Experiential rewards: These next-gen benefits are truly able to foster long-term positive sentiment and emotional loyalty. In this category, you could offer complimentary services depending on your industry: massages, wine-tasting, concert tickets, or New Year’s Eve Gala access.
  • Partner rewards: Strengthening both customer and partner relationships, once again depending on your industry, could be complimentary cosmetic or fashion consultations, culinary workshops, or even Paddock Passes, guaranteeing unforgettable moments to your members.
LVR loyalty program rewards.
Italian luxury fashion giant LuisaViaRoma launched LVR Privilege with the help of Antavo. Together, they used experiential rewards to redefine the image of loyalty programs in the luxury fashion space. Learn more about the award-winning success story here

How to Measure Emotional Loyalty? – Can It Even Be Measured?

The two questions you have to ask yourself before introducing new rewards into your system:

  • Will these experience-based rewards motivate people to spend more within a certain period of time, just so they can grab them?
  • After customers redeem these perks, will they be more motivated to return to you?

With every type of measuring, you will need a control group. Think of it as A/B testing. One group receives the opportunity to redeem specific rewards, and the other doesn’t. With purely transactional loyalty programs, offering only coupons, cashback, or special sales, it’s easy to see how these perks directly impact indicators such as AOV, Purchase Frequency, or Reward Redemption.

A stat image from Antavo’s Global Customer Loyalty Report 2024 about emotional and rational loyalty trends.
Remember: in order to harvest great results from a loyalty program, first, you need to invest in it. According to the Global Customer Loyalty Report 2024, most companies are willing to spend a quarter of their marketing budget on their loyalty programs.

How Is Emotional Loyalty Measured Compared To Transactional Programs?

The situation is obviously different with experiential rewards. Traditional metrics may not work or need to be re-evaluated in this case. You can try to measure soft actions like engagements, social shares, or follower count growth, but even those will only give you approximate numbers.

What you need here is customer feedback! Ask the people what they want! Create surveys and questionnaires and ask customers to rate the experiential benefits they have access to, and how likely they would make additional purchases based on them. This way, you can get firsthand feedback, and be able to pinpoint exactly what works and what doesn’t.

Of course, planning out how to measure your emotional loyalty’s success is just the first half. You’ll also need the right tech that either offers comprehensive reporting capabilities or has all the necessary integrations with third-party platforms.

Genuine Connection Always Shines Through

Emotional loyalty is a genuine connection established between a brand and its customers. An active dialogue involving mutually beneficial actions, clear messaging, and feedback, evoking true emotions resulting in repeat purchases, engagement, and high/exclusive brand preference in a given sector.

This is why next-gen loyalty programs and their experiential reward offering are a must. They help both identify, and elevate your loyal customers, plus nurture their bond with rewards built around true emotions.

Remember: you can’t just say how much you know your customers and how much you care about them. You need to show it. Every action, every offer, and every form of messaging counts toward it.

Are you thinking of creating or revamping your loyalty program? See how Antavo’s powerful platform can help you! Get in touch with us by booking a demo or — even better – by sending us an RFP.

Ready to find out more about creating the perfect loyalty program concept? Don’t hesitate, and download our practical and helpful Concept Worksheet, and get to creating right now!

Antavo
Author: Antavo

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