Several analysts have given Apple Inc. (NASDAQ:AAPL) an ‘outperform’ rating. The company cited customer loyalty as one of the main factors that will contribute to stock performance. The firm stated that when customers purchase an Apple media or Smartphone product they are more likely to buy Mac computers or other Apple products.
“The link between customer loyalty and stock price performance is the ability to create incremental purchase behavior—- how share of mind leads to share of wallet,” says Mark Johnson, CEO of Loyalty 360 – The Loyalty Marketer’s Association. “The more loyal a customer is in any industry, the less likely they are to purchase from a competitive brand. The brands with the high engagement scores and loyalty metrics are looking to continue to improve on that.”
Successful brands like Apple have found a way to differentiate their service, product or offering to create high levels of customer loyalty and engagement. This is why Johnson believes in a market need for research, to develop and sell a loyalty metric because it will validate that that the more loyal a person is to a brand, product or merchant, the higher share of wallet that merchant, product or brand has.
It is also proven that the more loyal a person is, the less sensitive they are to price. This means that brands with strong customer loyalty can charge a premium for the product, brand, and overall customer experience—- and drive their bottom line. “Look at Apple once again. Their desktops cost twice and laptops 2.5 times as much as their competitors,” says Johnson. “Being able to charge this premium creates ROI, shareholder wealth, ROE, etc. All of these financial measurements create an increased PE and, therefore, stock performance.”
Mark Johnson is CEO of Loyalty 360 – The Loyalty Marketer’s Association (www.loyalty360.org), the only organization that addresses the full spectrum of both customer and employee loyalty issues. An unbiased, market driven clearinghouse and think-tank for loyalty and engagement opportunities, insights, and responses, Loyalty 360 is the source business leaders trust for industry metrics, market driven research, actionable case studies, and networking opportunities. For additional insights, Johnson can be reached directly at [email protected]; 513-290-5147