A few months ago when I purchased my Tesla Model S, I had no idea that Tesla had a loyalty program. Perhaps I was distracted and mesmerized by the brilliance of the technology housed in this vehicle. Maybe my attention was diverted as I was infatuated by the gorgeous design of the car. Or was I overwhelmed with joy at the prospect of never again having to fill my car up with fuel? As a loyalty practitioner, how could I have missed this, as loyalty is part of my very DNA?
As I continued to engage with the brand, it became evident that Tesla has a very clever and covert loyalty program. In fact, every Tesla owner is a member of the Tesla loyalty program, yet nobody has ever heard of the Tesla loyalty program. So how can a brand’s loyalty program exist if their customers have never heard of it, don’t recall enrolling in it or participating in it?
Welcome to the newest emerging loyalty concept called “informal loyalty.” While Tesla may be an innovator and best-in-class in the premium electric car category, they are not the first to lean on this principle. Many other brands like Apple, Nest and Nike+ are actively partaking in the newest frontier of loyalty: informal loyalty. Informal approaches to loyalty may not bear the loyalty program moniker, yet they have cleverly and deliberately borrowed some of the familiar design elements of formal loyalty program designs.
Let’s examine the differences between formal loyalty programs and informal loyalty and better understand how Tesla has been able to partake and prosper:
So one can see that informal loyalty not as pronounced as formal loyalty, shares many of the same mechanics as its predecessor, and can be equally as effective if not more so. I suspect that leading business visionaries and change agents like Elon Musk and the late Steve Jobs (Apple being a significant player in informal loyalty space) clearly understand the benefits of informal loyalty as a lever to build brand loyalty. While formal loyalty programs are not expected to be replaced completely by informal loyalty any time soon, brands should be assessing how they can harness informal loyalty mechanics to build everlasting brand loyalty.
For more information about informal loyalty, download the 2020 Loyalty Report