/ Money

Does loyalty pay?

Dog looking loyal

Many of the best relationships in life are based on loyalty. And it’s not just with our personal relationships; lots of us are loyal to brands as well. But does loyalty really pay?

Some of us always buy our coffee from the same shop, or stick with the same bank account for a lifetime. But is this a wise move? Should we instead be more mercenary when it comes to things like getting the best return on your savings or getting the best deal on your energy tariff?

Earlier this week the Financial Conduct Authority published the results of its study into the cash savings market. In short, it found that loyal savers missed out on the best deals. Moreover, although a small number regularly shop around, most people don’t.

This means that banks are able take advantage of consumer inertia by paying low rates on older savings accounts. In fact, we estimate that UK savers are missing out on £4.3bn by leaving their money in poor value savings accounts.

Advantages to loyalty

Of course, there are good reasons why you may want to stick with the same company, even if they aren’t the cheapest or most competitive. You may just really like their customer service, for example.

But is it worth paying a premium to do so? Many companies seem to reserve their best deals for new customers, whereas longer standing customers are charged a higher price. It would be much easier if loyalty was rewarded, but these days it seems like you have to regularly shop around to make sure you’re not getting ripped off.

What do you think? Does it pay to stick with the same company or should people regularly review their options to make sure they’re getting the best deal? Your views will help me with an upcoming feature in Which? magazine.


Motor insurance companies served us well at one time, allowing their customers to build up useful no-claims bonuses. Nowadays it is common for companies to hike prices for existing customers, making it necessary to compare premiums annually. If you get a competitive quotation and go back to your existing insurer they may undercut this by a few pounds. I suggest forgoing this small saving and use the opportunity to tell your existing insurer that you are not fond of loyal customers being treated in this way. Take the opportunity to ask them to take you off the mailing list, though that request will probably be ignored.

Companies are out there to make money for their shareholders, so whatever business model they use will be aimed at that objective. Otherwise shareholders will invest elsewhere and the company will fail. However, to be a successful business means attracting and keeping customers. So they have to balance maximising profits with customer satisfaction. Whether we like it or not, we customers have to look after ourselves and that means surveying the market for what are the best deals for us – our objectives are to look after our own interests, and not those of any company; it works both ways.
I do not believe many think they are being “loyal” to a company – why would they unless they have a special relationship with them – family/friends business, or a shareholding perhaps? I think for most they stay through “inertia” – not bothering to look around, or the incentive to move is not sufficiently enticing.
We need to properly assess these introductory offers. You take out new broadband – half price for 6 months. Then perhaps not competitive afterwards. Insurance 30% off for the first year, but then more expensive than your current provider (as I found with house insurance). Is it worth the hassle? Time to negotiate with your current provider. As Which? has reminded us before, haggling pays.

No loyalty does not pay.
I cannot think of any example over my life where being a customer for a prolonged period has resulted in a cheaper service than a new customer gets. Haggling does pay whether that, be as a new customer, threatening to leave or just doing arice comparison. Even this week I managed to reduce by home insurance by over 20%, with my existing supplier. This was by doing a price comparison where they came out the cheapest and I asked them to price match themselves.:-)

I am fascinated by how we think of businesses as an entity in themselves, after all aren’t they staffed by us, customers?
Whilst the employees may not have much choice on the company pricing the directors do. Do those people as customers view loyalty differently. I suspect they are pragmatic, and may I say callous, with possibly a view of look after yourself. Caveat emptor.

Over the years I have seen considerable evidence of smaller companies showing loyalty. For example one person businesses or larger ones where you are usually dealing with the same person will often quote prices that are lower than what they advertise for a job. I design leaflets, posters, booklets and banners for charities. I have to get competitive quotations to make sure we are spending money wisely, even though I know my favoured companies will be cheaper. It is fairly obvious that I am being treated as a loyal customer.

There must be many who are sick of haggling with insurance companies and perhaps business opportunities for companies that do respect loyal customers.

If I was a business then I’d say YES, it helps me milk the cash cows of this world. As a consumer, it’s a big fat NO.

I have subscribed to Which? for years and I used to keep the magazines for about ten years to refer to. When the magazine archive became available and I had become familiar with using it, I disposed of all the magazines more than two years old.

Unfortunately, most of the archive has gone and we can see nothing before December 2012. I am not aware of any warning of this change.


I’ll look into this for you Wavechange.

Thanks Patrick. Since it is a membership matter I posted on the membership forum but there is no indication that the full archive will return.

Hello Wavechange, I’ve had a chat with the team who works on this.

The mag archive was updated to improve its appearance and allow it to work on different devices in a more useful way. However, I’m happy to say that we do intend to add more archived magazines to this new archive once other website changes have been made.

I also want to share that you can still access all the archived magazine articles through the Which.co.uk search (which has also been refreshed!). Just search what you’re looking for and use the filter on the left-hand side to the find the mag archived PDFs. eg. http://search.which.co.uk/search?lbc=which&method=and&p=Q&ts=custom&uid=457907163&w=nuisance%20calls&af=type1%3amagazinearchive

I hope that helps.

Thanks very much, Patrick. That is good news.

Being able to search for articles is more useful than looking through old issues.

Just got a Letter re my TVTimes Subscription telling me it is going up from £9.95 per Quarter to £20.13 in 5 days time. So why has The same company sent me an E mail say I can have this Subscription for £15.49 or offered me subscription in the current TVTimes for £12.35.
On ringing the Customer Care Team I was told to cancel my current Subscription and take our a new one. So as this do not care about me and give me a reduced subscription without a lot of effort by me. I decided they don’t care about me as a customer why should I do business with them. So I cancelled my subscrition

Magazines direct offer TV Times @ £10.99/qtr “rolling subscription” guaranteed for 1 year (= £41.96) or a 1 year subscription for £51.99. Wits (and a calculator) are needed..

I think the subscription price of TV guides is going up because sales are falling away. They are still cheaper than buying the mags each week but they don’t tell you much more than you can read in the daily papers or the weekend supplements, on the websites [if you can find a way through the advertising], or with the on-screen programme guides that give details for seven days ahead. I can’t see the full range of TV guides currently on the market surviving much longer unless they can come up with something new; they seem to be limited to feeding off the upcoming featured programmes and all having the same pictures on the front covers in rotation for Poldark/Dr Who?/Corrie or E.E./SCD or GBBO/and a medical soap.