Was talking loyalty with an FMCG client recently, and their desire for a simple, sales-based metric that would be commonly-understood internally. Things like proportion of category spend, for example. Which is all well and good, and probably very important. But for me it missed the more important question.
What I have rarely (if ever) seen explored/quantified in any market, is why exactly people are loyal in the first place. Which isn't an especially profound observation. But there are a whole host of loyalty drivers out there, with most of us having more than one at play.
For instance (and I admit some of these may be the same thing in reality), I can think of...
- Salience loyalty: brand is more front of mind (power of famous advertising);
- Distribution loyalty: brand is available in more places (think beer in the on-trade);
- Performance loyalty: brand works better (quicker, stronger etc.);
- Emotional loyalty: brand is 'liked' more (we've all been there, even if we can't explain why);
- Promotional loyalty: brand is on permanent offer (call it bribery!);
- Inertia loyalty: brand is what you've always bought (when it's easier to not think about it);
- Peer loyalty: brand is what 'everyone' buys (good old herd behaviour);
- Pester loyalty: brand is what someone else asks for (and not just from kids);
- Negative loyalty: brand is the least worst option (insurance anyone?);
- Hassle loyalty: brand is just too difficult to sitch from (most utilities and financial services);
- Compatibility: brand only works with itself (a lot of tech brands - see Microsoft/Apple)
- Monopoly loyalty: brand is the only option (so you better just live with it!)
...and probably many more (thoughts welcomed).
Any of these could deliver the same top-line 'loyalty' in terms of a single, sales-based metric, but the 'how' of marketing will differ depending on the 'what' of the underlying (and potentially quite complex) web of loyalty drivers...especially if you are also want to change the nature of this loyalty as well.
So maybe that simple, one-size-fits-all metric (nice as this might seem) isn't the answer, and we need a range of measures that can differentiate between the type of loyalty a brand generates: because 'functional' and 'emotional' loyalty must always be preferable (because it is inherently sustainable and differentiating) to 'mechanical' and 'inertia' loyalty (which is unstable and vulnerable to attack).