Are customer retention messages in TV ads really driving customer value?

Offering great deals might be the usual way to attract new customers, but as more brands recognise the value of long-term customer relationships, the number of promotions to retain them is increasing. In our study Loyal Losers Part Two (LL2) – featured in Marketing Week today – we set out to understand whether the messages in four specific TV ads (for O2, Sky, EDF and Lloyds Banks) were effective in the increasingly important battle to retain customers. Our objective was to provide brands with information on how much these retention messages are resonating with consumers.

What we learnt in Loyal Losers Part One (LL1) (published in Marketing Week on 17th October 2013) was that people vary enormously in attitude and behaviour to loyalty – some people always switch (‘Conditioned Switchers’), while at the end of the scale are ‘Loyalists’ who remain with trusted brands through thick and thin. Although these ‘loyalty’ traits define a person’s ‘default’ position towards loyalty, brands can influence where customers sit on this spectrum by the way they treat them and the offers they make.

Are customer retention messages in TV ads working?

In LL2 we validated the ‘loyalty personalities’ identified in LL1 with the same clusters emerging. However, what surprised us about the findings of LL2 was that people’s opinions of the retention ads that we shared with them varied little by personality type. Irrespective of their ‘loyalty persona’ customers weren’t convinced by the retention promotions being offered. Why does this matter? One of our community members expresses it well:

“I would hope that any business would want to retain customers rather than have to attract new ones, as I would think this is cheaper and easier. On the internet customers can easily check and compare rates and vote with their feet. We now have more power to choose and the companies have to be more attractive to win our loyalty. With a few exceptions I am not loyal at all anymore. I cannot recall any particular ads that make retention offers. I can’t remember being offered any when renewing a product I have, apart from a bit of a discount if I say I am not renewing.” Female, 45-54, Conditioned switcher

Our next post will take a closer look at the four loyalty personalities.

To find out more about Loyal Losers Part Two, please get in touch.

The other current customer/retention ads investigated in LL2

‘Live the good life’ TV ad – O2
‘Samuel L Jackson features in Sky Broadband Shield’ TV ad – Sky
‘Energy Blue Price Promise’ TV ad – EDF
‘It’s on us’ financial ad – Lloyds

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