I'm still pondering the topic of customer loyalty (to a retailer or a brand) and finding there's a lot of fundamental/foundational information to be considered on my way toward digging into retailer loyalty in the digital channel. In this instance, it's (become) a consideration of loyalty in and of itself, in particular distinguishing it from the notion of convenience.
It is arrogant and dangerous, to no small degree, to assume that because a customer regularly purchases the same item from the same retailer that this is an indication of customer loyalty. I expect that retailers aren't much concerned with why people buy regularly from them, and are thankful when they do - but the presumption of customer loyalty leaves the retailer in a precarious position when customers stop buying and the retailer has no idea why.
The "why" is, in most instances, that the customers who followed a behavior pattern that suggests loyalty were not in fact loyal, but were shopping a given retailer out of convenience. Convenience itself is a broad concept that entails the cost to the customer of obtaining the goods they wish to possess - it is generally taken to be the effort to get to a retailer (how far they need to drive, when the store is open), but price is also a factor in convenience (how much of their own labor is needed to obtain the money to pay the price).
But to drag myself back to topic: a customer who regularly purchases a given item at a given retailer out of convenience is not the same as a customer who purchases out of loyalty. The moment a more convenient option is offered - a closer store or a lower price - the convenience customer will change his habits and begin shopping at the competition. It is not that the retailer has lost the loyalty of that customer - but that he never really had it to begin with.
A loyal customer will continue to give his business to a retailer even if there is a more convenient option available. There is an emotional or intellectual attachment to shopping at that particular retailer even in the presence of more convenient options.
It may be a matter of esteem: a customer may take pride in buying a clothing item at Macy's that is available at a cheaper price at Wal-Mart, simply because they consider themselves to be a "Macy's Customer," which puts them in a higher social order (if only in their own minds) than the people who shop at Wal-Mart.
It may also be a matter of loyalty: there are still a significant number of customers (though often not significant enough to sustain a store) who shop for clothing in a "downtown" location, because the same retailer has served them all their lives, and their family for a few generations before - in spite of the fact that downtown is less convenient (distance, parking, etc.) than a suburban shopping mall that sells the same items.
A retailer who has loyal customers, those who are genuinely loyal and not merely convenience-repurchases, likely knows very well the reason his customers are loyal, and jealously defends those qualities of his operation that engender customer loyalty. Those retailers who claim to have loyalty because of behavior they do not understand often find themselves helpless to predict or react to changes in the competitive environment.
It seems to me that this may be another part of the puzzle - that retailers who assume loyalty to be dead are simply those that do not understand their customers - and it is their own ignorance, rather than the callousness of the buyers in a market, that is the source of their distress.
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