Wednesday, June 20, 2007

Why Brand Loyalty is Vaporizing

One of the general rules of marketing is that the leading brand doesn't have to "enter the fray." Let the second and third tier brands fight it out. Let them make comparisons, because after all, they'll be comparing themselves to you.

But Advertising Age is reporting that huge companies (Apple, Subway, Pizza Hut and Diet Pepsi specifically) are now taking the gloves off and doing comparative advertising.

The reason: brand loyalty is down...

As much as it's my job to build brands, to support brands and to encourage brand loyalty, it is sort of a funny concept. Some act like brand loyalty should be a function of history and previous practice. Like you had a commitment ceremony with Coke because you bought it six times.

But brand loyalty is diminishing for a few reasons, among them:

  • Brands are doing too many line extensions. What is Bayer, for example? Aspirin, of course. But as Ries and Ries point out, Bayer introduced their own brand of "non-aspirin pain reliever." How dumb was that? It's like holding a sign up on their flagship product saying, "We're really just a commodity, buy the store brand."
  • Brands don't earn loyalty. You spend billions to get me to buy your product and 50 cents on the call center. And then you're surprised that I don't come back to buy?
  • Product innovation and promise delivery generate brand loyalty. I got a Mac a year ago. My next computer will be a Mac. It costs 3 times what a comparable PC costs, and I'm sorta cheap. Don't care. The thing just works. It's simple to use. It's fast... That's brand loyalty building...
You can do comparative ads. Many may be better than some of the nonsense out there today in the big ad world... But look inward big brands... I bet your ad agencies will look smarter, and consumer loyalty will increase, when you start being loyal to your own brands first.

What do you think? How can brands build their loyalty?