Taylor Gray, Ph.D.
The world is a better place when companies are good corporate citizens. I remain focused on developing meaningful and actionable insights from empirical data in pursuit of a better world.
Brand loyalty. It’s the holy grail of marketing...and an important source of our problems.
Nearly every brand across every industry wants to grow their customer base. They want us to become customers and then they want us to remain customers. It is less risky and less costly for a brand to retain customers than it is for them to find new customers. For them, brand loyalty is a cornerstone of success.
But brand loyalty is also dangerous. We almost always prefer one brand to another for many different reasons, but when we become ‘loyal’ to a brand we remove the pressure we have for them to become better--we reduce our own power.
Don’t be loyal to a brand, be loyal to brands being better.
The Imbalance of Loyalty
Being loyal--at least from the brand’s perspective-- means we no longer question the value of what we are buying. It means we made a choice at some point that a given brand was the ‘best of the best’ and now we continue to buy from it without doubt, concern, or reflection.
With loyalty, wanting a brand to be the optimal choice for us actually transforms the brand into being the optimal choice regardless of evidence or objectivity... and brands know this. If brands can get us to be loyal they no longer need to compete for our spending, they no longer need to convince us that they are the optimal choice for us, and so they no longer need to develop and improve to meet our expectations.
If I am looking for new running shoes, I can compare a few models from a few brands and find the best option for me that fits my running and my values. Let’s say I did this comparison and decided a pair of New Balance shoes came through as the winner. The next time I need another pair of shoes, I can run this same comparison but maybe start with a slight edge to New Balance based on past experiences. But If I were ‘loyal’ to New Balance I wouldn’t even run this quick comparison again because “New Balance is the best and no other brand even comes close”.
But this is nonsense. If you are at all familiar with running shoes--or any other product for that matter--you will know that the models on sale today have very little in common with the models of only a couple years ago (apart, perhaps, from the model name). What I liked about New Balance at first may not even exist now. Here’s a very clear case in the running shoe market: we are now into the 38th model variation of the wildly-popular Nike Pegasus shoe and not one of these models if the same as any of the others. To say that you always run in Nike Pegasus because they are the ‘best’ is baseless--the Pegasus to come is not the Pegasus of now and certainly not of those that came before.
There is always room for brands to be better.
Brands change all the time--in what they make, how they make it, and how they take responsibility for their impacts. Not only do brands continuously change their products and their operations, but the executive team at the helm when you fell in love with the brand is quite likely not the same as the executive team calling the shots today. The average tenure of a CEO is now less than seven years, while those of the CSO (sustainability) and the CFO (finance) are each less than five years, and that of the CMO (marketing) is less than four years. The brand you fell in love with is quite likely not the same as the brand you are buying from today.
Pushing for Better
Brands are always changing, but by being loyal, we remove the impetus for them to meet our expectations and free them to change however they see fit--which typically means toward higher profit margins and lower degrees of responsibility. When brands are held to account on our expectations we get a vote in how they change, but when we release this pressure we also release our leverage.
Let’s keep the pressure on them, let’s be loyal to better.
If brands cannot count on a loyal customer base then they have to stay sharp--they have to earn our spending time and time again and to do that they need to meet our expectations even when our expectations change. Coming back to our earlier example, once upon a time I wanted comfortable running shoes, today I want comfortable running shoes which also have a low life-cycle impact on the planet and people. Brands that can fulfill the former expectations may not be the same that can meet the latter.
Customer loyalty removes the pressure for brand improvement. Don’t be loyal to a brand, be loyal to brands being better. No brand is entitled to our spending. They need to earn it and to do that they need to meet our expectations...even when our expectations change.
There is always room for brands to be better. Even the best brands today can continue to be better tomorrow. Let’s keep the pressure on them, let’s be loyal to better.
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