How To Craft A Customer Loyalty ROI Model (S1-E019-01)

Written by PortMA

How To Craft A Customer Loyalty ROI Model (S1-E019-01)

How does your brand make money from marketing? It’s impossible to overstate the importance of connecting return-on-investment (ROI) to your marketing strategy. In fact, we could go as far as calling it the holy grail of successful marketing. But how do you go about it? In this blog and the second part, we’re going to share our insights to help you succeed by increasing your customer loyalty.

Estimated reading time: 3 minutes

Understanding ROI Beyond Customer Acquisition

When you consider the return-on-investment your marketing campaigns are generating, it’s easy to stop at customer acquisition. But what about the people who are already aware of or buying your brand? Increasing their value to your brand is the goal of loyalty campaigns. Put bluntly, you are aiming to increase loyalty and stem customer churn.

To understand how we measure ROI for these campaigns, it’s worth taking a step back and reminding ourselves where revenue in marketing comes from. Basically, there are three ways in which any marketing can generate revenue for your brand:

  • Incrementally increasing usage from existing customers
  • Acquiring customers from your competitors
  • Introducing new people to the product category

When it comes to loyalty campaigns, marketers would generally focus on the first revenue generator. Think about a product like orange juice. By targeting your existing customers, perhaps with a promotion, you encourage them to purchase a higher quantity or make more regular purchases.

(You can listen to the full episode of the podcast below.)

Four Areas of Loyalty Campaign Revenue

1. Are you Communicating a Lifestyle Match?

Consumers will choose a product based on how relevant it is to them. For your brand to be front and center of its awareness, it needs to align with its lifestyle and its sense of who they are. A customer’s values, beliefs, habits, and attitudes come together to create a buying profile – or a lifestyle.

When the aspects of that lifestyle align with the values and beliefs your brand is communicating you have a match. The brand moves towards the front and center of the customer’s awareness, and you will see more of their money being spent on that brand. Thus, increasing the campaign ROI.

2. Can Your Product Solve More of Your Customers’ Problems?

Expanding customer usage can be simpler than you think. If you understand how your existing customers use your product, it’s easy to identify which benefits and features they’re not yet using.

Marketing communications aimed at highlighting more holistic usage of the product can help expand customer usage. Line extensions are another example of this. Consider a food product: if you have loyal customers buying your brand, they may be more inclined to try a new product launched by the same brand. As a result, your brand fulfills a broader array of your customers’ household needs.

In Part Two of this blog, we examine the role of customer defection and customer service. Plus, we will explain how to calculate ROI from customer loyalty campaigns. Stay tuned!

Additional Resources


  • Experiential Measurement Blueprint
  • Event Impression Calculator
  • Experiential ROI Benchmarking Reports
  • Event Measurement Video Tutorials
Click for Additional Resources