Gone may be the days when 80% of a company’s sales were driven by 20% of its customer base. In new research by Nielsen, only 8% of global consumers are loyal to the brands from which they’ve always bought. In the U.S., the numbers are only slightly better, with 9% of U.S. consumers stating they are brand loyal.
More and more consumers are open to trying new brands and products. In the U.S., 36% of consumers love to try new brands and products and 55% stated they sometimes try new brands and products. Only a small portion (9%) stated they never try new brands and products. (Nielsen)

The reasons for trying new brands included value for money as a top reason for choosing a new product or brand (38%), while about one-third (32%) say price or promotion drives their choice.
How the Customer Experience Influences Brand Loyalty
Customer experience is also an important factor in brand loyalty. Consumers are more likely to be loyal to brands who provide personalized and individualized customer experiences. Consumers are more empowered today, shopping across channels of their choosing, researching before purchasing, shopping at any time of the day or night, price comparing, reading reviews and so forth.
They also understand that as they do this, they are leaving a digital footprint, information about their behaviors that they expect brands to collect. They believe this so much so that 63% of consumers agree that personalization is part of the standard service they receive and 61% assume relevant data about them will be at companies’ fingertips. Over half (53%) expect a brand to know their buying habits and preferences and be able to anticipate their needs.
When brands deliver, consumers are more loyal and will purchase more. The Temkin Group found that companies that earn $1 billion annually can expect to earn, on average, an additional $700 million within 3 years of investing in customer experience.
Additionally:
- 86% of buyers are willing to pay more for a great customer experience
- 73% of buyers point to customer experience as an important factor in purchasing decisions
- 65% of buyers find a positive experience with a brand to be more influential than great advertising (source)
Of course, when brands fail to deliver, the opposite is true. According to research by RedPoint, consumers report it is very frustrating when a brand sends them an offer for something they just bought (34%), sends them offers that aren’t relevant (33%), or does not recognize them as an existing customer (31%). And, more than 1 in 3 (37%) will go even further to stop doing business with a company that doesn’t offer a personalized experience.
Millennials and Brand Loyalty
Among millennials, brand loyalty may be even lower. Only 1 in 5 millennials describe themselves as being loyal to specific brands according to research by Morning Consult. The research found that most millennials either usually consider alternatives despite some brand preferences (48%) or simply don’t pay attention to brands (28%).
The biggest influence on millennials’ loyalty is reliability and/or durability, according to 68% of respondents. Other reasons include the quality is high for the price (54%) and as having positive interactions with the customer service team (50%). Regarding customer service, poor interactions would influence 74% of respondents to be less likely to purchase products from a brand they’re loyal to.

Millennials are also very social conscious and care about how a company treats their employees. For example, 7 in 10 would be less loyal to a brand if they found out that the brand doesn’t pay their employees well, and 69% would buy less from a brand if they learned that the brand relies on unethical labor practices.
Research by McKinsey also showed that consumers may not be as brand loyal as believed. After analyzing data, the research found that of 30 categories that were analyzed, just 3 were primarily loyalty-driven including mobile carriers (81%), auto insurance (24%) and investments (69%).
Across the other 27 categories that were analyzed, loyalty broke down as follows:
- 13% – loyalists, who didn’t shop around
- 29% – shopped around, but ultimately stuck with the incumbent brand
- 58% – switched to a different brand
