What Will Drive Loyalty Tomorrow?

Articles
April 05, 2010

What Will Drive Loyalty Tomorrow?

Some loyalties never waver: ask anyone who wears a cheese head to the Green Bay Packers games.

Some loyalties never waver: ask anyone who wears a cheese head to the Green Bay Packers games.

But measures of shopper loyalty to stores can and do shift with economic circumstance and the purity of a retailer’s mission to fill shoppers’ most compelling needs (today, that is savings) and behave as a shopper-centric resource. Therefore, The Lempert Report isn’t surprised by the strong loyalty rankings of Walmart in 2010, according to a newly released study by Colloquy, which surveyed 3,500 adults in December 2009 and broke out their responses by five regions of the United States.

“The Great Recession became the great equalizer,” said Colloquy partner Kelly Hlavinka. “Low prices have stepped up to become retail’s strongest loyalty lure according to consumers.” This contrasts sharply with 2008 when customer service, store environment and product selection drove favorable responses.

So Walmart, which derives 51% of its chainwide sales from food and delivers on its ‘low prices and value’ consumer messages, earned the #1 loyalty rankings in the grocery sector from consumers in Northeast (where it is not yet heavily penetrated) and Northwest, and earned #3 loyalty rankings in the Southeast, Southwest and Midwest.

Also in the grocery sector, Kroger, powered by its loyalty expertise, came in #1 in the Midwest. Publix was #1 in the Southeast. HEB ranked #1 in the Southwest. All renowned store operators, they held command of their regions despite the overall recessionary skew toward Walmart.

While we express ‘no surprise’ on the current survey results because price is so meaningful today, we fully expect subsequent surveys to reflect shifts in consumer loyalties towards stores that capture ‘the next big thing’ and keep in sync with the evolving needs of their shopper bases.