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There’s a lot of chatter in the business world about engaging your audience, building an army of evangelists and creating that holy grail of marketing: brand loyalty.
But the more we talk about it, the more we seem to dilute it and the further the center shifts from what brand loyalty is to some vague definition based on a notion of “people doing business with us repeatedly”.
Here’s one definition I found: “The degree to which a consumer consistently purchases the same brand within a product class.”
But there are a lot of reasons we purchase the same brand and many of them have nothing to do with loyalty.
Here’s a better definition: “When consumers become committed to your brand and make repeat purchases over time…regardless of convenience or price.”
A little better, right?
But there are more reasons than price or convenience that keep us buying, and still they have nothing to do with loyalty.
Interestingly, I found what I thought was the most thoughtful definition from the Disney Institute:
“While customer loyalty is defined by what people do, brand loyalty is defined by how people feel.”
We’re onto something here. This definition touches on one of the more ethereal components of loyalty and that’s our emotional connection with a brand. Still, it leaves out quite a bit.
Definitions aside, if we’re barking up the wrong loyalty tree we could be wasting a lot of time, effort and money. To build a circle of evangelists and believers, you need to know what compels loyalty in the the first place. So here are a few things loyalty is – and a few it isn’t – so you can build true loyalty instead of just an illusion based on “repeat business”.
Brand Loyalty Is Not…
Remember the day you heard that Hostess was going bankrupt and that Twinkies would cease to exist? You probably conjured up a dozen images of loving childhood Twinkie memories.
But come on, when was the last time you actually ate a Twinkie?
I’m sure there are a few diehard fans who still snack on those unnaturally spongy concoctions but for most of us, we probably haven’t seen one since our moms stuck them in our GI Joe lunchboxes.
I remember only a single occasion within the past 25 years that I bought a box of Twinkies out of sheer curiosity for a long-forgotten treat.
And I love that bizarre banana-yellow cowboy-cake-thing as much as the next guy.
Yet the moment Hostess announced its plans to shut down those Twinkie factories, the entire web ecosystem exploded with hysteria. Twitter got itself a trending hashtag and Twinkies went on sale at eBay for up to $200,000 a box (though the highest price I can confirm was paid was about $50… still!)
You would think, with all the outpouring of love and sadness and shared memories, that Hostess would have found itself instantly solvent.
Alas, no such thing happened.
Why? Because despite a veneer of “loyalty”, nobody actually wanted a Twinkie. Nobody had the particular emotional connection with Hostess that superseded everything else to drive Twinkie sales.
Twinkies were a fond if irrelevant memory and nostalgia is not the same as loyalty.
Did you think immediately of any particular brand?
I’ll go out on a limb and say I bet it was Heinz. Whether you eat it or not, Heinz dominates the brand recognition test and it’s widely assumed that it’s the best ketchup on the market.
But if you’ve browsed any of the research you’ll find plenty to support the exact opposite – there are brands that beat out Heinz in taste tests every day. And in a “top 5” list, sometimes Heinz doesn’t even make the cut!
Everything from Hunts to Whole Foods, to arbitrary-local-organic-ketchup-brand wins taste tests regularly. And even though not everybody agrees on which ketchup wins, there is a distinct trend: it’s rarely Heinz.
So why is Heinz so dominant? Some might say loyalty. I argue that it has nothing to do with loyalty and everything to do with perception (powerful marketing) and habit.
Think about it: if you found a product that tastes better than the one you currently consume, wouldn’t you switch to the tastier brand? Or would you be so loyal to that first brand that you’d opt to eat something less delicious just for the sake of staying loyal?
And what if that more delicious product were also less expensive?
I’m sensing a lot of alleged loyalty going out the window.
True loyalty means sticking with a brand through thick and thin… no matter how it runs off your hamburger.
I buy Exxon gas exclusively. I can’t remember the last time I bought anything but Exxon gas.
Ask me how loyal I am to Exxon.
Or better yet, don’t. That would just be opening a can of worms.
So why do I buy Exxon? Because I can’t spit from my front door in any direction without hitting an Exxon station. There’s one a block south, one two blocks north, one west and if I drive east I’d end up in the ocean, so there’s an argument to be made that I’d hit a little bit of Exxon there, too…
There’s a second component and it’s called “Speed Pay”. It’s that little doohickey you attach to your keychain that you swipe to buy gas, coffee, potato chips or whatever else you need from a gas station and its convenience store.
I have to laugh when a bank “thanks me for my loyalty.” I’d leave most of them in a heartbeat if it weren’t such a damn pain to switch.
Not quite the type of loyalty we’re going after, is it?
Don’t think this is only relevant to big brands, either.
We offer hosting services to our clients. But I don’t kid myself for a second thinking that customers are loyal simply because they have hosted with us for 10 years. Have you ever tried to move a website? Not so much fun! It takes time, effort and disrupts a lot of things, so it’s far more convenient for my customers to stay with me than it is for them to move their sites.
I’m not implying that we don’t have loyal customers – we do! But we have to give them a reason to be loyal and remember that what may appear to be “loyal” behavior on the surface may not be at all.
Brand Loyalty Is…
When thinking about loyalty and building it for our businesses, we need to look beyond the superficial loyalties to what really motivates people.
And one of the most important motivators is the experience we create around our products and services.
According to research presented at 360 Connext:
81% of consumers will pay more for a better customer experience.
And 92% say that a poor service experience decreases their loyalty.
I’ll give you a minute to digest that.
In essence, that’s saying you do not have to be the next Walmart to build loyalty. On the contrary you can charge more and have more loyal customers (who won’t leave you at the sight of the next sale) if you simply create a positive experience.
What else does that tell you? All obstacles aside, you don’t need to come up with tricks, gimmicks, schemes and selling points to win customer loyalty. You don’t need to falsely bind people to you by making it difficult for them to leave. You don’t need to tax your marketing department to figure out ways to build loyalty. It’s quite fundamental: all you need to do is focus on your customer.
Easier said than done! But it’s your job, especially as a small business owner whose customers have plenty of options that may be cheaper, more convenient and in other ways more attractive, to create the best possible experience for your customers.
I’m talking about an emotional connection, one that goes beyond the quality of your product or the excellence of your service.
To really create a sense of loyalty and cultivate a few evangelists, you need to tap into the irrational side of behavior.
And by “irrational” I don’t mean “crazy”. I mean the tendency of people to do business with a company even when the prices are higher, the drive is longer, the obstacles steeper, the lines six blocks long on a cold, rainy day…
Any particular company come to mind?
I’m talking about Apple, a company you can’t deny has a rabidly loyal following.
They don’t compete on price – Apple has some of the highest prices in its class.
They don’t compete on features – many argue that PCs and Android devices have more options, flexibility and customizability than any counterpart Apple product.
They don’t compete on convenience – you can’t pick up an Apple product just anywhere and seriously, have you seen those lines?
You might say they don’t compete.
Apple has successfully built a culture around innovation, creativity, uniqueness and a certain high-end counter-culture lifestyle that many people identify with. It’s a connection with a way of being and thinking that Apple users wouldn’t give up for all the free Android products shipped directly to their doors in the world, even if they came with a lifetime’s worth of free Twinkies.
So the simplicity of your task is clear: make an emotional connection with your customers. Be sure that they can identify with your brand and the lifestyle it represents.
But the practicality of how to do that is a whole lot more complex. It takes years of building that connection before it pays off. You can’t start a business and make connections as fast as you can accumulate Twitter followers.
You must have a clear vision for your business, clearly defined values and a clear mission that you communicate through every pore, every action, every word of content and every interaction with your customers.
You might argue that poor Twinkies had made an emotional connection with its fan base.
I bet a lot of people were genuinely sad to hear about the bankruptcy. I admit I had an emotional moment as I thought about the loss of such an iconic brand.
But what Twinkies (and a large swath of other Hostess products) missed was the component of relevance.
People thought fondly of Twinkies but nobody felt particularly compelled to buy any. In an increasingly health-obsessed culture, where low-fat, low-carb, unprocessed, whole grain, no grain, vegan, gluten-free, [insert arbitrary made up health term here] has turned meal prep into label-reading drudgery, Twinkies were just that processed, fattening, sugar coma inducing snack you ate as a kid. Along with white bread, I can’t think of anything I’d be more loath to admit to eating.
Alas, our emotional connection amounted to nothing more than nostalgia.
As a business, we need to constantly reinvent ourselves to meet our customers’ needs, desires and demands. I don’t mean we need to be schizo about it – after all, Apple, that archetype of brand loyalty, reinvented the iPod in sixteen gadzillion ways (I owned three) but at its core it was still an iPod.
But the decline of Twinkies (and I’m oversimplifying here because I know there are more nuances than just loyalty) is due in large part to the fact that it relied solely on a connection it made with its customers when most of them were five years old. They failed to innovate, change or engage us in any meaningful way in our lives right now.
Brand Loyalty Is More Than Just Two Words
Many words later, what I hope you’ve taken away from this is that brand loyalty isn’t just some “thing” you can conjure up with a few incentives, a “loyalty” card and some vague talk about encouraging repeat business.
It’s not even about all that great content and the “value” you’re providing with it (gasp!) Just ask Geoff Livingston. He makes a great point about how experience trumps content marketing which goes to the very heart of the Twinkie dilemma.
Loyalty, rather, is a mindset – giving customers what they want, when they want it. Doing it well, and building great experiences and lasting emotional connections around it. And taking the time to do it right, born from your business vision and values and not cooked up during a Tuesday marketing meeting.
You can’t turn everyone into a loyal customer, the same way you can’t be everything to everyone, the same way your target market isn’t “everyone”, the same way you can’t please all of the people all of the time.
But you can create a band of loyal evangelists for your company and brand. It’s all in how you define – and engender – loyalty.
I would love to hear your thoughts on loyalty. What is it? What isn’t it? And what are YOU doing to build it in your corner of the business world?