Beware the negative aspects of playing brand loyalty card

brandsCalling consumers fickle is a distortion of marketing principles that were smuggled into the profession under the brand loyalty banner

Consider the following press release from Verdict Consulting. “UK shoppers are more disloyal than ever before,” it tells us. “British consumers are more disloyal than ever before with the retailers they use,” it continues. “Across retail as a whole, some 10.8 million shoppers are disloyal to the stores they use; and, across every retail sector more consumers are saying that they would prefer to use an alternative store to the one they currently use most.”

“Although not every customer will act on their disloyalty, such a high level of fickleness is extremely worrying for retailers who are already struggling with weak consumer sentiment and spending,” it adds.

This research is sort-of interesting. In harder times, consumers shop around more and this affects retail and marketing strategies (we would be very surprised if Verdict’s research discovered that shoppers weren’t doing this). But the language is very interesting. What meaning, what sentiments do words like “disloyal” and “fickle” convey? What do they tell us about the evolving relationship between consumers and marketers?At one level, Verdict’s press release is perfectly innocent. Some poor PR person is doing their best to write a press release that will grab people’s interest. A headline saying “Cash-strapped shoppers are shopping around more for better value” doesn’t sound half so urgent or important as “disloyal”, “fickle” shoppers threatening retailers’ futures. Nothing wrong with a bit of colour.

But there is something wrong with using such judgementally negative words about customers. This is the sorry end of a sorry tail – the disastrous distortion of marketing principles that were smuggled into the profession under the banner of “brand loyalty”.

First thing to note is that adding the word “loyalty” to “brand” provides as much additional information as adding “wet” to “water”. Brands were invented for one reason and one reason only/ to encourage repeat purchase. Everything about the brand – its distinctive look and signage, its clear and unique value proposition, its promise of superior quality – was invented so that consumers would seek it out, find it and rebuy. It’s this repeat purchase that takes the financial risk out of investing in research, production and distribution and which turns a tiny, insignificant one-off sale into a lucrative long-term revenue stream.

Given that this is what brands are about, the fact that marketers found themselves needing to add the word “loyalty” to “brand” should have set alarm bells ringing. If brands needed something new, special and extra called “loyalty” it meant they were no longer doing the job they were invented to do.

The second thing to note about the loyalty bandwagon is that it masterfully adopts the first rule of the Teflon politician – manufactured meaninglessness. The politician’s trick is to come up with a word or phrase that seems to resonate with the times but which is empty enough of real content that different people can project his or her own meanings into it – thereby “uniting” people who disagree behind the same banner.

“Loyalty” did that job perfectly. It was an empty vessel into which marketers could pour anything they liked. To some, for example, loyalty was about designing carrots and sticks to encourage repurchase or retention – sales promotions by another name. The biggest example of this was points-for-purchases loyalty schemes.

To others, loyalty was about generating customer “delight” – creating brand experiences and value propositions that were so superior that no sane customer would consider any alternative – while to a third group, loyalty was primarily an emotional commitment to a brand’s personality, values, emotional associations and so on.

Each one of these represents different marketing philosophies and implies a completely different set of priorities and actions. But with “loyalty” everyone could embrace it as theirs; pouring their pre-existing assumptions into a shiny new empty vessel and mixing them all around, so that out they came… unchanged. The addition of the L-word didn’t add anything or take anything away. We still had carrots and sticks, value delivery and emotional appeals.

No harm done, you might say. But the L-word also contains an element of poison. It panders to the most dangerous of all of marketing’s occupational diseases – corporate and brand narcissism.

Brand narcissism turns the customer/brand relationship on its head. Brands prosper by delivering superior value to customers. But with brand narcissists, it becomes the customer’s job to deliver value to the brand.

With its strong connotations of one-sided obligation, the L-word encapsulates the narcissist’s dream. Subjects are supposed to be loyal to their sovereign, making sacrifices on their sovereign’s behalf. But the sovereign is not expected to make sacrifices for his subjects.

Build a relationship
Deliberately or not, the L-word carries with it these connotations of one-sided sacrifice. Indeed, that’s how the loyalty guru Fred Reichheld first presented loyalty in his early writings on the subject. Loyalty, he said, is “a willingness to make a sacrifice in order to build a relationship” – and it was always the customer that was supposed to be loyal, never the company.

In our right minds, we know that this is a fantasy. But “loyalty” did not appeal to marketers in their right minds, it appealed to their narcissistic tendencies. “Just imagine, millions of consumers out there who love me so much that they remember me with affection, happily pay more for me, forgive all my mistakes and misdemeanours, overlook my faults and tell other people how wonderful I am. Yes, I’ll buy into that. Where do I sign up? What do I need to do?”Tony O’Reilly expressed this narcissist dream when, as Heinz chief executive, he defined loyalty in terms of a housewife discovering that Heinz Tomato Ketchup was out of stock in a store and walking out of that store to buy it elsewhere. For O’Reilly, loyalty was about the housewife sacrificing her time and energy for the sake of his brand, to let him off the hook of his own supply chain failings.

Saatchi and Saatchi’s Kevin Roberts pandered even further to the narcissist dream in his 2006 British Brands Association lecture on so-called “lovemarks” which, he promised his delighted audience, would deliver “loyalty beyond reason. That’s loyalty beyond benefit, beyond price, beyond logo, beyond attribute”.

Once we’ve entered such heights of narcissistic fantasy, the realities of real relationships begin to fade from vision. We find ourselves forgetting that one of the things consumers value most is choice, and that virtually any research that’s ever been done into real consumer behaviour shows consumers buying a repertoire of brands.

Right to choose
They hardly ever display the devoted, dog-like loyalty narcissists dream of. But if we place ourselves in the position of a sovereign expecting loyalty from his subjects, when consumers do actually assert their right to choose, it suddenly takes on a treasonous colour, of “disloyalty” and “fickleness” – words that express fear and disdain if not contempt.

Looking back, there are two things to learn from the sorry loyalty episode. First, the one good thing about loyalty is it helped broaden service marketers’ minds to embrace the need to service ongoing customer relationships as well as acquire new ones. Actually, this has nothing to do with loyalty per se, and everything to do with the basics of value delivery. But never mind. Tesco’s Sir Terry Leahy kept his feet on the ground when he insisted that his company’s job was to earn the lifetime loyalty of its customers – a formulation that put the emphasis where it should be – on earning the shopper’s custom.

Second, if you are looking for positive emotional commitment, it comes from treating people fairly and with respect. And one surefire way of not achieving this is to go about branding them as “disloyal” and “fickle”.

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