Measuring Loyalty: Two Perspectives

Customer loyalty, in any category, is the consistent preference and commitment to a particular brand. Despite this, it’s shaped by industry-specific dynamics and varying customer behaviors. As such, it requires tailored strategies depending on the industry and sector. For the purposes of this article, we will focus on measuring loyalty through two interconnected lenses: 

1. Market-Level Competition 

2. Customer-Level Behavior 
    

Market-Level Competition: 

At the market level, loyalty reflects how dominant or competitive a category is. To measure this, we developed the Market Concentration Index, derived from the Herfindahl-Hirschman Index (HHI), where higher scores indicate market concentration (i.e., fewer dominant players), and lower scores denote higher competition (i.e., a more even distribution of market share among brands). 

For example, highly competitive categories such as Grocery and QSR exhibit a low concentration index, with multiple brands sharing market share relatively evenly. In contrast, Travel Aggregators demonstrate high concentration, with one or two players holding most of the market share (see Fig.1 below). 

Source: Data from Bond Data Lake, powered by Synapze XI’s “Wallet IQ”; Nov 2020 – Nov 2024, United States, Representing XXX   

Figure 1. Market Concentration Across Industries. In 2024, Grocery, QSR, and Gas & Convenience categories are highly competitive, with top brands holding 40%-50% of market share. Conversely, Travel Aggregators are highly concentrated, with top brands collectively commanding over 90% of market share. 

Source: Data from Bond Data Lake, powered  

Figure 2. Brand Loyalty at the Market- and Customer-Level. Competition across categories is analyzed at market and customer levels. Market concentration (x-axis) reflects the dominance of leading brands, while wallet fragmentation (y-axis) measures the extent to which customer spending is distributed across multiple brands. 

Loyalty Across Industries

Dynamic & Personalized Engagement Strategies within Highly Competitive Markets: QSR 

QSR is an example of a category with both high competition and fragmented customer spending. Customers interact with QSR brands more frequently than with other categories, leading to diverse shopping patterns. For instance, less than 10% of QSR customers shop exclusively at one brand annually, compared to roughly 1/3 of Grocery customers and 1/5 of Food Delivery customers (Bond Data Lake, 2024). 

While the average number of QSR brands that a customer shops with at has slightly decreased over the past few years—indicating some wallet consolidation—, higher-value QSR customers show signs of more promiscuous shopping behaviour, purchasing across a broader set of brands . At the market level, QSR has remained highly competitive, with top brands (McDonald’s, Starbucks, Chick-fil-A) collectively increasing their market share by only 2% over the last four years, sitting below 50% overall (Bond Data Lake, 2024). 

Strategic Insight: In highly competitive categories such as QSR, building loyalty hinges on a brand's ability to adapt quickly and effectively to dynamic customer behaviours and competitive pressures. To stand out in these environments, brands must prioritize personalized engagement, value-driven promotions, and convenience to capture share of wallet. Given that higher-value customers can tend toward more promiscuous shopping behavior (we’ll touch on this more in Part III of the series), offering targeted incentives or exclusive experiences can help mitigate churn and foster deeper loyalty as seen in The Bond Loyalty Report with increased performance from Macdonald’s, Papa John’s and Chipotle’s through personalization. Purposefully designed streaks and quests in the form of gamified and connected actions, can motivate next behavior and drive visits to build new habits. 

Retaining Loyalty Through Innovation in Dominant Markets: Travel Aggregators 

Travel Aggregators, such as Expedia, highlight the extreme end of both concentration and consolidation. Over the past four years, Expedia’s market share has grown from 73% to 87%, leaving little room for competitors. In 2024, the top three aggregators control 95% of the market, creating a near-monopolistic landscape (Bond Data Lake, 2024). 

At the customer level, wallet consolidation is even more pronounced, with nearly all customers (98%) spending exclusively with one aggregator brand in 2024 (Bond Data Lake, 2024). However, aggregators are beginning to lose wallet share to direct-to-consumer (D2C) travel providers.

Strategic Insight: In a category dominated by few players, brands face unique challenges when fostering loyalty. With plenty of sites with aggregated ownership leading to high wallet consolidation, the focus shifts from acquisition to capturing more products for the booking (flight, hotel, rental car, excursions). Strategies should prioritize maintaining customer satisfaction through seamless experiences, superior customer service, and exclusive perks that discourage churn. However, the emerging threat from direct-to-consumer (D2C) travel providers signals the importance of proactively addressing customer needs, such as greater transparency, pricing advantages, or unique booking options that D2C platforms often provide (we’ll unpack this further in Part II of the series). Aggregators must innovate to stay ahead, finding new ways to deepen engagement and loyalty even in a saturated market. 

Key Takeaways & Strategic Implications

Our findings stress just how much loyalty and competition are shaped by category-specific dynamics. Understanding these nuances is critical for brands seeking to win share of their customers’ wallets.

Key factors influencing loyalty in 2025 include:

1. Interaction Frequency: Categories with higher interaction frequency, like QSR, naturally exhibit more fragmented wallets compared to low-frequency categories such as Travel.

2. Market Structure: Highly competitive markets require differentiated customer engagement strategies, while concentrated markets can leverage dominance to drive loyalty.

3. Customer Value Segmentation: High-value customers often display promiscuous spending behavior, necessitating tailored strategies to enhance loyalty.

4. Emerging Trends: The rise of D2C in concentrated markets such as Travel Aggregators signals a shift that brands must anticipate and adapt to.

By aligning loyalty strategies with these factors, brands can effectively navigate the competition, ensuring sustained growth and customer engagement.