Breakfast waffle… Loyalty is vital for brands
In his latest Liverpool Daily Post column, Ben Hatton discusses the value of brand loyalty at a time where price sensitivity continues to grow.
“At the start of every year, businesses in all sectors review their strategies to see how they can apply lessons learned to increase revenue.
In marketing, there are now conflicting claims about the about the value of brand loyalty in such an uncertain economy.
Some statistics suggest loyalty has been severely eroded by widely-available promotions such as vouchers and targeted discounts, and that as price sensitivity grows, shoppers become more fickle in their purchasing patterns.
Bain & Co and Katar Worldpanel’s UK Shopper Survey 2012 shows that, on average, 50% of a brand’s “loyal” customers will not be with them the following year.
They quote loyalty to beer and lager brands as a key example – a sector where people change their buying habits according to price offers. Mainstream brands tend to be highly promoted and stocked next to cheaper alternatives. Only 39% of shoppers know which brand they intend to buy before shopping, and consumers buy on average 3.3 different brands of beers a month.
But in some sectors, loyalty is key. It may well be harder now to build and maintain loyalty – but if it is achieved, it can be even more vital.
No-one seriously questions the importance of brand loyalty among high-end names such as Rolls Royce or Rolex – the brand is the essence which creates the loyalty.
Others in the mid-market – Apple, Gillette, Dyson and Call of Duty – have learned this lesson.
It’s all about getting the marketing right. Be clear about position, execute plans well and avoid having the brand permanently linked to promotions. The rules are clear and simple – and so are the rewards.”