It's Time To Rebuild Brand Loyalty

Businesses are now dealing with buyers who are armed with both information and harsh expectations.

Technology and good deeds will help.

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By Avi Dan

Brand loyalty is crucial for brand health. Ad agency founder Jim Mullen once said: "Of all the things that your company owns, brands are far and away the most important and the toughest. Founders die. Factories burn down. Machinery wears out. Inventories get depleted. Technology becomes obsolete. Brand loyalty is the only sound foundation on which business leaders can build enduring, profitable growth."

The changes that technology brought to consumers have changed that too. Americans are becoming less loyal. Even seemingly strong names rarely translate into much power at the cash register. Consumers are continually looking--and finding--a better deal, opening the door for companies to introduce a raft of new products and promotions.

The single biggest explanation for the troubled state of many brands is consumers' growing access to technology. This has created a more informed and demanding consumer: Even as the quality and reliability of products have generally risen, satisfaction ratings have not budged. In some cases, they have actually fallen. Businesses are now dealing with buyers who are armed with both information and harsh expectations.

What are smart marketers to do?

1. Learn what consumers are thinking: Technology is an incredibly powerful tool when it comes to learning how and what consumers say when they are talking about a particular brand. The tools that let marketers do this range from a simple search on Twitter to sophisticated software packages that track the sentiment of what's being said by millions. Both offer greater insight into consumers than was ever available before technology became central to communications; and, fortunately, make it easier to understand how to strengthen loyalty.

2. Marketers need to reach consumers on multiple platforms: In a technology-infused age, consumers are constantly shifting and "multitasking," playing a multiplicity of roles simultaneously. The key is for marketers to be where their consumers are on the Web. While targeting people according to their Web-surfing behavior is part of this, it also involves being invited into consumers' increasingly fragmented lives. If a consumer complains about a brand online, the brand should be there, ready to assist. If you build an iPhone app, don't build it just because apps are the hot new marketing tool, but because the brand can offer something useful that can be delivered via technology. A game that has nothing to do with the brand doesn't do the trick; a portable recipe app that a harried mother can use while at the grocery store does.

3. Engage the super influencers: As consumer-generated social media evolves, it has built its own hierarchy, one in which certain users have built powerful distribution channels on which to state their opinions on current events, their passions and brands. These Super Influencers might maintain a well-read blog, hundreds of Facebook friends or thousands of Twitter followers, but the result is the same: They have inordinate influence on how the rest of us think about brands, and on whether or not we might buy them.

4. Experience instead of messaging: The best companies of our generation understand how engagement and positive customer experiences create brands. Google and Facebook are experiential brands, as are Zappos, Twitter, Netflix, Amazon, Apple , Starbucks and Nike . These companies understand that we are living in a world where consumer loyalty isn't formed in reaction to a message, but through a series of experiences over time that the brand and company create.

5. Do well by doing good: Marketing is no longer an economic function alone, but a social force as well. Within minutes of the Haiti earthquake, donations requested on Twitter started flowing in via text messages in coordination with the phone company. Pepsi bypassed the Super Bowl for the first time in 23 years, and instead of buying $3 million spots in the game, announced on its Facebook page that it will donate $20 million to worthy causes. Social ideology increasingly reinforces brand loyalty.

Brands need to restore their bond with consumers. The Information Age challenges marketers to become more creative in how they adapt to new realities.

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Originally posted in Forbes.com on Feb. 22, 2010

Avi Dan is CEO of Avidan Strategies LLC, a consultancy specializing in strategy development and positioning; marketing and advertising process design; and agency search and compensation. He can be reached at avi@avidanstrategies.com.

Comments

[Yannig Roth]

Very interesting, this post points out what seems to be today's marketing reality.
There's only one thing where I think discussion is worthwhile : when you say "If a consumer complains about a brand online, the brand should be there, ready to assist". A brand could indeed monitor its reputation and help if necessary, but abusive intervention can be perceived as intrusive by the customer too.
I think one way to bypass that is to sustain the company's good image among customer, whose "engagement" or "convictions" could serve the brand reputation in places such as blogs or forums.
If you are interested, check out 2 of my blog posts (IN FRENCH, sorry ;) :
Brands' new relationship to customers
http://yannigroth.wordpress.com/2009/10/21/la-nouvelle-relation-des-marques-aux-consommateurs/
Apple's "brand world" as French marketing professor Lionel Sitz described it
http://yannigroth.wordpress.com/2009/10/23/le-monde-de-marque-dapple-selon-lionel-sitz/

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[True Religion Outlet]

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