Why Brand Loyalty Is Important

Introduction

The ultimate aim of all brands as well as those who market them is to build up a large, solid following of customer who are loyal to the brand, discussing it and favouring it in purchasing decisions where it is involved. The question that needs to be answered by all good brand promoters then is how to gain this loyalty and this favour from customers. Jeff Bezos (2004), founder of Amazon.com believes that “A brand for a company is like a reputation for a person.”, in that both are built through achievement. But the simile doesn’t end there, like a person’s reputation the brand isn’t just a single definite object, but a subjective concept which is considered differently from different perspectives. The question is: Is this difference of perspective merely superficial and intellectual, or does it evidence a subjective and personal attachment to, or resonance with the brandEach side of this argument has solid evidence, logic and supporters to back it up which will be considered in the course of this piece.

Further through the interview quoted above Bezos points out that “If you [the brand] do build a great experience, customers tell each other about that.” ‘A great experience’, something which carries emotional weight, is required for customers to demonstrate behavioural brand loyalty and engagement by promoting the brand themselves. This interaction, which is very important to many brands, is the result of what Keller and his contemporaries (2001, 2008) deem ‘Consumer Based Brand Equity’. Literally meaning that part of the value of the brand lies in the heads of individual consumers. It is gradually built up subjectively through advertising and product performance which the customer sees as beneficial and relevant to them (Keller 2001). The ultimate aim of this process is to achieve a strong customer-brand ‘resonance’ where the brand is seen by the customer as an engaging and personally rewarding choice for them. This resonance is achieved through objective judgements as to the usefulness of the offer made by the brand, as well as subjective choices based on feelings and attitudes to the brand.

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According to the model one of the major benefits of achieving resonance over a period of time is brand loyalty, with customers repeatedly buying brands which gain their judgemental and emotional approval telling others about their satisfaction with it. Emotional Branding by Daryl Travis operationalizes the model and presents extensive real life evidence of it in practice in the form of case studies of successful brands which have aimed their brand messages at customers’ emotional sides.

The nature of the link between customer satisfaction and brand loyalty is important for marketers to understand, Bloemer and Kasper (1995) find that loyalty begins in the sub-consciousness and is developed and increased through habitual manifestation and discussion of the loyalty as the customer develops attitudes of loyalty and even, in their words, ‘commitment’. As human judgement and emotion are complicated things, this is a complex process for businesses to go through. Many theorists believe that customers rarely have individual, attitudinal attachments to the brands they buy, positing instead that the best way to gain customers is simply to promote brands widely so that they are thought of when buying decisions are made. This is the view subscribed to and considered by the Authors of Brand Advertising as Publicity (Ehrenberg et al., 2000) where the colours are very much nailed to the mast. Ehrenberg has a long history of supporting the non-attitude based objective publicity based model of marketing, as well as criticising the opposing model.

A very relevant conference paper of Ehrenberg’s, with an equally descriptive title, is New Brands: Near Instant Loyalty (Ehrenberg & Goodhardt, 2000), a summary of research showing that new brands gain loyal customers much more quickly than previously thought. The inference is that knowledge of the brand and its functional usefulness mean that the customer comes back to it, without any drawn out process where attitudinal attachment or resonance is built up.

Loyalty rates are another proven consumer trend which back up the views of Ehrenberg and others. Romaniuk and Sharp have shown that consumer loyalty lines up with market share (2004) and that the likelihood of purchase is closely related to the likelihood of recalling the brand in the situation (Romaniuk et al. 2004). This fairly direct brand awareness – buyer behaviour association is not a new one, so support for it dates back to the sixties (Assael & Day, 1968). However, the wide spread of evidence for these associations can be seen as a result of their age as well as their efficacy. In reading this evidence we must also consider, that individual attitudes viewed on a large scale normalize creating trends and rules of thumb as it were, which can be read and theorized. This basic tenet of social studies means that logically evidence of generally applicable rules does not diminish the likelihood of individual attitudes factoring in to them, Assael and Day noted this in their work. What this work did do though is open the way for the popular, widely evidenced and broadly applicable Dirchlet model of purchase choices and buying behaviour (Goodhardt et al., 1984) which itself provides the logical basis for Ehrenberg’s criticisms outlined above.

In general, those who support the idea of attitudinal loyalty, and whose work favours this perspective, see consumer loyalty as a gradual and individual process of aligning oneself personally with the brand. Whereas a less attitudinal reading means a more immediate one with more or less universally similar buying motivations. Though there is more historical support for the latter argument this is due to its age and traditional acceptance. Further to this, not all of the evidence in support of the latter view precludes the former one (eg. Assael and Day 1968). It can be inferred from this that the characterizations of loyalty based on universal rules and those based on subjective attitudes are not irreconcilable, though there are numerous problems as Romaniuk and others point out.

Bibliography

Assael, H. and Day, G. S.,(1968). ‘Attitudes and awareness as predictors of market share.’ Journal of Advertising Research 8 (4), 3-10.

Bezos, J. (2004) Jeff Bezos on Word-of-Mouth Power [online] Bloomberg Businessweek [viewed 17/06/2009]. Available from: http://www.businessweek.com/magazine/content/04_31/b3894101.htm

Bloemer, J. M. & Kasper, H. D. P (1995) ‘The complex relationship between consumer satisfaction and brand loyalty’ Journal of Economic Psychology (16) 2 pp. 311-329

Ehrenberg, A. S.C., Barnard, N., Kennedy, R., & Bloom, H. (2000), “Brand Advertising as Publicity,” Journal of Advertising Research,

Ehrenberg, A. S.C. and Goodhardt, G (2000), “New Brands: Near-Instant Loyalty,” in 40th Annual Conference of the Professional Market Research Society. Toronto, Canada: Professional Market Research Society.

Goodhardt, G. J.,Ehrenberg, A. S.C and Chatfield, C. (1984), “The Dirichlet: A Comprehensive Model of Buying Behaviour,” Journal of the Royal Statistical Society, 147 (part 5), 621-55.

Keller, K., Aperia, T. and Georgson, M. (2008) Strategic brand management: a European perspective. Essex: Pearson Education Ltd

Keller, K. (2001). ‘Building Customer-Based Brand Equity.’ Marketing Management. 10(2), 14-19.

Romaniuk, J and Sharp, B., (2004) ‘Conceptualising and measuring brand salience.’ Marketing Theory 4 (4), 327-342.

Romaniuk, J., Sharp, B., Paech, S. & Driesener, C. (2004) ‘Brand and Advertising Awareness: A Replication and Extension of a Known Empirical Generalisation’ Austalasian Marketing Journal 12 (3) 70-80

Travis, D. (2000) Emotional Branding: How Successful Brands Gain the Irrational Edge. Michigan: Prima Venture

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