Brand Loyalty

There is a need not only for customer equity oriented strategies but also for investing in behavioral research of customers to know the underpinnings on which loyalty or retention is built

Brand loyalty is the repeat purchase made by the consumer out of commitment to the brand. In many cases of loyalty, marketers may do well to check if the repeat purchases are made out of commitment or if they are inertia purchases. You may keep buying a brand of soap or toothpaste because of its availability with regard to a specific stock-keeping unit which he can afford (50 grams or 75 grams package is the specific stock keeping unit referred in this context). Brand loyalty is indicated when the consumer deliberately chooses a brand from a set of alternative brands.

You may not go through a decision process to select a brand when you are brand loyal. Though there is a great deal of similarity/overlap between habit and loyalty, the repeat purchase made out of convenience can be classified under habit whereas purchases made out of commitment are loyalty.

When you develop loyalty towards a brand you develop a favorable attitude towards the brand resulting in commitment. Brand loyalty offers a number of advantages to the marketer. “Brand loyal consumers start building a relationship with the brand”. You may become advocates of the brand by the positive word of mouth. “Brand loyal consumers may become passionate about the brand and form clubs which results in further strengthening the brand”.

There is even research evidence to show that brand loyal consumers may even actually avoid advertisements of competitive brands. Loyal consumers may also be prepared to try out the variants of the brand and in certain categories may even be prepared to pay a premium (high priced cigarettes and perfumes may be examples).

Brand loyal consumers may try out other offerings (other categories) brought out by the brand. Fabmart, the Internet store, which is into books, jewellery, music and groceries, has consumers who are loyal to the brand and are likely to order several categories from the store – this indicates store loyalty. Under certain conditions, consumers may also transfer their brand loyalty across product categories.

Recently there has been research which reflects that brand loyalty could be enhanced if the product tried results in a high degree of satisfaction. This is because the consumer feels that the time invested in learning about the brand has resulted in a positive outcome.

Is Brand Loyalty Built on Functional or Symbolic Aspects? Drawing upon several theories and models associated with consumer loyalty and learning processes, consumers may initially become loyal to a particular brand because of its functional benefits. Loyalty across toothpastes, cars, banking services and books clearly show that a brand has to score on functional aspects whenever consumers use ‘search-oriented’ products (search-oriented products are those which could be evaluated by consumers even before they buy/try the product). For instance, a consumer may go through the ingredients of Colgate Total and derive inferences about the benefits (evaluate it to a certain extent) and try the brand. Loyalty on such search- oriented products gets initiated when the consumer experiences the benefits of functional attributes.

Symbolic associations may also play an important role in strengthening loyalty to a brand (gel toothpastes are advertised on the symbolic aspects and this trigger a certain kind of loyalty because of peer group associations – this could happen after the brand is established). But even when symbolism triggers loyalty, a certain degree of benefit should be an outcome of the brand usage. Symbolism can have an impact on loyalty related to products which are consumed for sensory gratification – such as beer, perfumes and cigarettes. A brand’s communication revolving around symbolism (status or snob appeal or group affiliation or a personality trait) adds to the gratification inherent in the product and results in loyalty. In categories which are highly ‘experience related’ like hotel services or airline services, symbolism could enable consumers try the service. Experience related services are those which could be evaluated only after the consumer goes through the consumption experience.

An ideal approach for a brand would be to use the functional route to loyalty and then use appropriate symbolic communication to strengthen the loyalty over a period of time. The basic assumption in this kind of an approach is that the brand would constantly update its offerings (or product line) with improvements which would result in a competitive advantage over competing brands. A brand has to adapt itself to the changing environment over a period of time (while using symbolic imagery consistent with its brand proposition). Bajaj has a strong value for money family-oriented and a very Indian (ethnocentric) image.