In today’s consumer-driven world, there’s an onslaught of competing products that have identical features but differing brand names. As someone who actively toes the line between consumer and marketer, I can’t help but wonder what it is that makes us love some brands; why are we so loyal to some but not others?
I recently read an article in the Harvard Business Review that discussed how brands gain and maintain competitive advantages. It stated that given a choice, the human brain would like to do the same things repeatedly, claiming that each time a consumer chooses a product, that product gains an advantage over the products the consumer didn’t choose.
The article argued that customer loyalty is created based on accessibility and routine. If a consumer develops a view that her clothes are cleaner when she uses Tide, and Tide is available and accessible, the consumer will continue to buy Tide again and again.
While I agree that this is often how consumers make purchases, I believe that brand loyalty is expressed by consumers who consciously choose a brand because it meets an innate need at a higher level, or it delivers a product that they simply can’t live without.
In an effort to better understand brand fidelity, our Rakuten Marketing Insights program recently conducted a study (available by the end of March on our site; email registration required) that examined consumer psychological and behavioral data. Through the analysis, we discovered there’s a significant connection between a well-established psychological theory and consumers’ feelings and actions towards brands.
Maslow’s hierarchy
Let’s think back to Psychology 101 and consider Abraham Maslow’s hierarchy of needs. Maslow believed that people are motivated to achieve specific needs at different levels, with some needs taking precedence over others.
Once an individual has fulfilled his basic needs, he will strive to achieve the following levels of needs that introduce safety, relationships and the pursuit of achievement, respectively. An individual has essentially reached his fullest potential and is self-actualized when all levels of the hierarchy have been fulfilled.
Maslow’s hierarchy has been applied as an organizational behavior tool in workplaces and classrooms all over the world, but how does this hierarchy of needs relate to consumers and brand loyalty?
The brand affinity hierarchy
There are striking similarities between the levels of Maslow’s hierarchy and the way consumers shop for products. When we apply these theories to real consumer shopping behaviors, we get a hierarchy that includes various levels of brand affinity, such as awareness, infatuation, fidelity and evangelism.
Consumers shopping for their basic needs simply need a product to do what it’s meant to do. But as consumers move along the brand affinity hierarchy, their motivations expand and they begin to care about the benefits the product offers.
This relationship further evolves as consumers develop trust in the brand, which can lead to infatuation. At this point, they feel that a specific brand contributes to their personal betterment, and they experience feelings of affection, appreciation, and even obsession.
To achieve brand loyalty, a brand must facilitate consumers reaching their maximum potential. The brand must connect with the consumer’s core values and reflect who they are — they simply can’t live without the brand.
In a recent survey we conducted, nearly half of consumers responded that they remain committed to a brand because the brand is closely tied to their identity or the brand’s core values align with the consumer’s values.
For Michelle, a lifelong athlete and avid trail runner, Athleta is the brand she turns to any time she needs something new. Michelle says in the survey, “Athleta is the one [brand] I most connect to. It’s who I am; it expresses me. I like the way it feels when it’s on. I like that it looks a little outdoorsy and active.”
Evangelism is the holy grail for brands. Brand evangelists want others to use and appreciate the brands they love because they believe the brands will enhance others’ lives as well.
In the same survey, consumers were split when asked if there is a brand they love so much they’d want to share it with others. This is interesting, since only 32 percent said that there is a brand they are 100 percent committed to, demonstrating that consumers can be moved to advocate even when they are not fully committed to a brand.
If a customer is actively advocating for your brand, it’s more powerful than any advertising you could do on your own.
How does brand affinity affect consumer purchases?
As consumers move along the brand affinity hierarchy, they become more valuable to the brand, making more purchases, purchasing more frequently and spending more money.
eMarketer cited that 65 percent of US internet users demonstrate loyalty to a brand when they buy more of their products or services. These consumers may deem themselves loyal by purchasing more, but their level of loyalty will vary as the motivations behind the purchases vary.
Our data shows that as consumers transition through the various levels of brand affinity, they are likely to come back and purchase again. Of those who have made two purchases from a brand, 45 percent will purchase again, while 66 percent of those who have purchased five times will purchase again. A customer’s value to the brand increases more than nine times from their first purchase to the 12th, where they finally demonstrate brand fidelity and evangelism.
It seems intuitive that customers are more valuable the more they purchase, and we know that it is more expensive to acquire a new customer than to retain an existing one, but customer retention isn’t always a top priority for brands. This data demonstrates that brands might have missed revenue opportunities if they aren’t investing enough in their existing customers.
Brands also need to ensure they are providing first-class experiences every time a customer interacts with their brand or makes a purchase, along with a high standard of quality in their products and services. But most importantly, brands need to ensure they are not providing poor customer experiences.
A brand typically has to mess up in the eyes of the consumer multiple times before they will move on, but 63 percent of loyal customers said they would shift loyalty to a competing brand if the product selection or quality changed. This is almost three times greater than if a competing brand offers better customer service. And when consumers leave a brand, they will likely shift their loyalty to a competitor.
My advice to brands is to remember that consumers, first and foremost, are human beings. As much as data and technology can get you in front of the right consumers, you also need to invest in creating digital experiences that speak to who they are as people.
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