Brand Management: The Concept of Brand Loyalty is Flawed and Impossible to Achieve. Discuss

Home
breadCrumb image
Brand Management: The Concept of Brand Loyalty is Flawed and Impossible to Achieve. Discuss













Brand Management





Table of Content




"The concept of Brand Loyalty is flawed and impossible to achieve. Discuss"

Introduction

The concept of brand loyalty has been proven to be of utmost importance for organisations to achieve sustainability and profitability in the market. The term Brand loyalty refers to the tendency of consumers in a particular industry to possess a positive feeling towards a certain brand and purchase goods and survives from it repeatedly. Many of the leading organisation's strategiestheirbusiness plans and marketing strategies revolving around the concept of brand loyalty. On the contrary, this aspect which every organisation strives to achieve in the market might just be impossible to achieve for the long term. This essay is thoroughly going to discuss the idea of brand loyalty and what difficulties that come in the way of achieving it. It will examine the impossibility of achieving brand loyalty for an organisation for the long term using academic opinions and real-life examples.

Discussion

Business organisations invest hefty time and money in producing and implementing strategies that will attract more and more consumers and gain customer loyalty from them to gain a competitiveedge in the market. although strategies implemented with such intention have proven to increase the profitability and sustainability of the organisations, it does not necessarily guarantee customer loyalty. For instance, Instagram, the photo-sharing app owned by Facebook, dominates the social media industry and it is one of the leading organisations in the current time. This brand, however, changed its old logo in 2016, replacing it with a new one, which was not perceived well in the market. several of the big media houses harshly criticised the Instagram over its new logo and demanded the old logo back. This severely upset its users, many of them turning to its rival Snapchat. Although Instagram did not change the services and features it was offering before it changed its logo, Customers still found Instagram non-appealing. This is the prominent example of how fragile the brand loyalty is and how quickly its dynamics can be shifted. Thus the possibility of customers shifting to the rival organisation in the market is inevitable.

It is evident that except a few exceptional brands in the market, many organisations are unable to keep a constant customer base and lead the market for a long time. A loyal customer of an organisation Like Nokia can quickly jump to other organisation for its products and services and be devoted to its rivals like Apple or Samsung. Althoughconsumers are observed to be committed to one brand as long as their emotional attachment, it can quickly change it the consumers feel that the brand no longer add value to their life or society.Several reasons achieving brand loyalty has become impossible especially in today's society.

The foremost reason for brand loyalty being impractical to attain is that brands today are not able to meet up the expectations of the audienceas established by a study done by (Zameer et al., 2019). Consumers, when using products or services from a certain brand no-look compare the service to what the company had been serving before, they compare it with the services from its rivals in the market. consumers expect the best of services from the brand they are devoted to comparing with other competing organisations.For instance, consumers who use the services of e-commerce organisation Flipkart can change their preference to the rival company Amazon if Flipkart fails to provide the services as good as Amazon.

A study done on the e-commerce industry by Yadav and Rahman (2018) showed that another reason for the impossibility of Brand loyalty is the lack of abilities of organisations to focus on customer experience as a whole. As the organisational structure is usually divided into the various department, each one being responsible for a certain aspect of the organisation. the lack of communication between these departments can be harmful to the organisation as these effectively serve to deliver customer satisfaction. It has been reported that customers can experience dissatisfaction, later leading to consumers not being loyal to the brand if there is a lack of contact and communication between the different department such as sales and after-sales section. One of the most significant causes behind the falling rate ofbrand loyalty can come from the fact that everything has become transparentin this era of technology (Foschtet al., 2018). Consumers now can compare various brands and their product or service quality, their prices and other significant aspects on their smartphones sitting anywhere in the world. Hence the term brand loyalty has become unstable and difficult to maintain for most of the organisations as consumers can get attracted to the rival company easily. This has created extreme competition among organisations to come up with lucrative and attractive strategies to gain consumers in the industry.

The other reason that can be behind the brand loyalty getting decreased and almost impossible to achieve is organisations failing to unique relevance to their consumers (Woratschek et al., 2020). If an organisation or brand is losing its consumers; it indicates that the organisation failed to essentially provide the experience of its product or services being relevant to the consumers. This effectively causes the consumers to feel that the products or service was not good enough to stand out or differentiate itself in the market and that the organisation was not considerate enough to put efforts in determining what role the brand plays in its customers' lives. Hence, the customers in this situation usually make rational decisions, without thinking about their emotional attachment to the brand, Causing brand disloyalty.

Another biggest reason is the loyalty programmes implemented in various organisation intending to increase brand loyalty, which has resulted in consumers opting rival companies instead (Kim et al., 2020). Plenty of organisations strategies loyalty cards programme to gain customer loyalty, which in reality have reported to decrease the profit margin from the existing customers of the brands.This led to many organisation questioning their strategies and process of building customer loyalty and maintain it (forbes.com, 2021).

Brand Loyalty has proven to be impossible to achieve in today's era mostly due to its wrong perception in the market. Many of the business organisations belonging from a diverse range of industries mistake the phenomenon of Brand Loyalty as one-dimensional. Many of the business firms put emphasis only on transactional loyalty while the concept of conversational loyalty is just as important (Coelhoet al., 2018). The concept of transactional loyalty refers to the rational approach to building loyalty in consumers by offering the most beneficial choice. Such type of loyalty help the organisation gain profits and grow but it does not hold any emotional attachment from the consumers, meaning that the consumers will not think twice before switching to other brands. On the contrary, the conversational which is also known as the emotional loyalty refers to the emotional attachment created with the consumers, usually through the value or principles of the brand aligning with that of consumers (forbes.com, 2021). The brands who are well-established in the market and hold dominance in the industry are known to possess the emotional loyalty from their consumers. The most prominent examples include Apple, Starbucks, and Dunking Donuts (Lee, and Soon, 2017). Although the brand loyalty for the long term is impossible to achieve, these brands have somewhat maintained its overall customer base.

Another significant cause behind the falling rate of customer loyalty is that is considered as a rationale aspect of the business by many of the business enterprises, according to a study done on the evolution of Brand loyalty (Casteranet al., 2019). For instance, many of the people who are environmentally aware are striving to adapt the methods of transportation which are not harmful to the environment. For such a situation their best available option is to purchase the electric vehicles manufactured by the company Tesla, which is the most rational and appropriate choice. However, many of the consumers for the automation industry still chooses to opt for vehicles made by either BMW or other traditional automobile enterprise they are attached to emotionally. Loyalty is a very essential mechanism which is very crucial for businesses to understand to comprehend the concept of customer loyalty (Elsäßer and Wirtz, 2017). The failure of achieving customerloyalty is deeply rooted in the misconception of the term. It is very vital for business firms to know that the customers are attracted more to the establishments who offer value for money(Chekalinaet al., 2018). In addition to this, the quality of product or services plays a crucial role in maintaining loyalty from customers. This will not assure that the customers will stay loyal forever but it can create a positive image of the brand in the consumer’s minds. Another thing to consider is that customers will not stay devoted to a company if it does not deliver conveniencein the purchasing process tothe customers. This has become a major reason for consumers to demonstrate disloyalty and opting for organisations which possess an easier method of buying procedures. Finally, the key reason organisations are facing difficulties in attaining customer loyalty is the lack of overall consistent experience by customers (Mohammad, 2017).

The aspect of attaining Brand Loyalty had given rise to the paradigm of consumer brand engagement. In simple words, the organisation use various types of processes and strategies to increase consumer brand engagement with the aim of achieving brand loyalty. This gives rise to the phenomenon of the consumer-brand relationship. In order to understand why the concept of brand loyalty is flawed,it is very important to comprehend the phenomena of brand engagement. The concept of brand engagement can broadly be defined as the state of mind of the customer related to the brand, motivation and context-related. According to Yuniari (2020),these aspects of the customer’s state of mind is usually shaped by the emotional, cognitive, and behavioural aspects involved in brand interaction. Another way in which brand engagement can be referred to is the magnitude of the customer's participation in the organisational activities or offerings initiated either by the customer itself or the enterprise. The customer’s dedication, vigour, and absorption essentially characterise the consumer's state of mind which effectively defines the brand loyalty or brand engagement. The conceptualisation of customer brand loyalty or engagement cab be derived for two key causes, first one being organizational psychology method of measurement which effectively incorporates individual behaviour where motivational construct and trait aspect definesengagement (Ratheret al., 2018). This essentially implies that the concept of engagement varies from person to person which makes it difficult for organisations to comprehend and utilise, making it even harder to achieve Brand Loyalty.

Another additional factor that makes it impossible to achieve Brand loyalty is stiff competition in the market. business organisations not only have to compete with each other in regards to products and services but gaining a loyal customer base as well (Jamzuri, 2020). Various business firms believe that they canachieve a competitive advantage in the market by attaining Brand loyalty from the customers. Thus, marketers from these organisations constantly strive to implement aggressive strategies to gain loyal customers. However, such a situation leads to stiff competition among the competitors, each one bringing more vigorous strategy than the other which might potentially harm the company’s profitability. Since most of the strategies might involve increased production cost or decreasedcost of products or services to the end-users, it will significantly reduce the profit margin of that enterprise, which directly conflicts with organisational aims and objectivesprimarily seeking to make a profit. Hence the concept of Brand Loyalty seems impossible to achieve for a long term in the market for most business companies (Kuchinkaet al., 2018). Such a big contradictionlies in the concept of Brand Loyalty essentially determines that it is flawed and almost impossible to achieve.

According to a survey performed (telegraph.co.uk, 2021), nearly 83% of the total consumer population of UK reported that they are happy to shift to new emerging brands as long as they deliver the expected products and services. Traditionally, customer loyalty has been driven forward by the products and services offered by the brands, but in today's era of fast-changing technology and business environment, these factors are not differentiators anymore. Consumers of today’s society are preferring experiential type of loyalty over the traditional transactional one, hoping to interact with the organisation and form a bond. This study also showed that 54% of the UK population felt loyal to the brands which made them feel valued, essentially by providing them with small symbols of fondness such as gift cards, personalised gifts and offers (Shanahanet al., 2019). Consumers today also want to engage with aninteraction with the company, to experience that the company understands them personally. Thus, it was observed that 44% of the people stated that they preferred to be loyal with the brands which communicate with them through effective mediums of communication and interaction. Another significant aspect found in this study was that 37% of the consumers demonstrated a tendency of thrill-seeking where the consumers were allowed to co-designed or co-create a product or services by the Brand.

More significantly, more than 35% of the consumers stated that they intended to show loyalty to the organisations which values align with that of themselves, in addition with the organisation supporting charity or public welfare programs. Due to such a diverse range of expectations from the consumer market, a big challenge is posed in front of brands in its path of gaining brand loyalty. Additionally, these demands from the consumer base are ever-changing, although making it impossible for an organisation to fulfil all the expectations.Marketers in the organisations will have to keep up with this changing needs of the consumers and implement the most efficient strategies constantly to gain nearly impossible Brand loyalty.

However, organisations still possess a silver lining as the conditions of Brand loyalty or loyalty from consumers can be improved. This can be effectively achieved by engaging with consumers. Organisations need tounderstand the Pareto principlewhichstates that 80% of the outcome stems from 20% of the efforts (Kimet al., 2017). Another significant aspect is ensuring that the brand is consistent. The organisation needs to deliver what it promises to its customers reaching extraordinary heights. Furthermore, the organisation essentially has to ensure that the products and services they are delivering are up to the mark of the consumers' expectations. Delivering value for money is of the utmost significance in the context of improving brand loyalty. Thus, it may be impossible to achieve Brand loyalty, but gaining competitive advantage and improving the perception of the Brand in Consumers' minds is still within reach of organisations competing in the market.

Conclusion

To conclude, the term Brand loyalty has been existing in the business dynamics for centuries, however, the possibility of attaining it has been declining with the passing time. One of the main factors behind thisphenomenon is the growing transparency in the business world, which allows consumers to compare different products and services themselves. another essential reason is the failure of organisations to emphasize the customer experience along with failure to meet the expectations of the audience. The concept of Brand loyalty is flawed as it is mainly focused on the aspects that are changing and evolving with time. However, as discussed above, organisations can still improve brand loyalty by implementing various methods, aiming to achieve competitive advantage in the industry.

Reference list

Casteran, G., Chrysochou, P. and Meyer-Waarden, L., 2019. Brand loyalty evolution and the impact of category characteristics. Marketing Letters, 30(1), pp.57-73.

Chekalina, T., Fuchs, M. and Lexhagen, M., 2018. Customer-based destination brand equity modeling: The role of destination resources, value for money, and value in use. Journal of travel research, 57(1), pp.31-51.

Coelho, P.S., Rita, P. and Santos, Z.R., 2018. On the relationship between consumer-brand identification, brand community, and brand loyalty. Journal of Retailing and Consumer Services, 43, pp.101-110.

Elsäßer, M. and Wirtz, B.W., 2017. Rational and emotional factors of customer satisfaction and brand loyalty in a business-to-business setting. Journal of Business & Industrial Marketing.

forbes.com, 2021. The Three Types Of Loyalty And Why So Few Companies Excel At Reaching The Pinnacle. [online] Forbes. Available at: https://www.forbes.com/sites/kimberlywhitler/2020/08/22/the-three-types-of-loyalty-and-why-so-few-companies-excel-at-reaching-the-pinnacle/?sh=f0182fa1f104 [Accessed 1 February 2021].

forbes.com, 2021. Three Mistakes Businesses Make With Loyalty Programs. [online] Forbes. Available at: https://www.forbes.com/sites/shephyken/2019/08/04/three-mistakes-businesses-make-with-loyalty-programs/?sh=ab4265d56af0 [Accessed 1 February 2021].

Foscht, T., Lin, Y. and Eisingerich, A.B., 2018. Blinds up or down? The influence of transparency, future orientation, and CSR on sustainable and responsible behavior. European Journal of Marketing.

Jamzuri, J., 2020. Influence of Promotional Strategies, Brand Image, Quality of Service and Price Against Community Trust. Journal for Quality in Public Health, 3(2), pp.268-275.

Kim, B.J., Singh, V. and Winer, R.S., 2017. The Pareto rule for frequently purchased packaged goods: an empirical generalization. Marketing Letters, 28(4), pp.491-507.

Kim, J.J., Steinhoff, L. and Palmatier, R.W., 2020. An emerging theory of loyalty program dynamics. Journal of the Academy of Marketing Science, pp.1-25.

Kuchinka, D.G., Balazs, S., Gavriletea, M.D. and Djokic, B.B., 2018. Consumer attitudes toward sustainable development and risk to brand loyalty. Sustainability, 10(4), p.997.

Lee, M.S. and Soon, I., 2017. Taking a bite out of Apple: Jailbreaking and the confluence of brand loyalty, consumer resistance and the co-creation of value. Journal of Product & Brand Management.

Mohammad, A.A.S., 2017. The impact of brand experiences, brand equity and corporate branding on brand loyalty: Evidence from Jordan. International journal of academic research in accounting, finance and management sciences, 7(3), pp.58-69.

Rather, R.A., Tehseen, S. and Parrey, S.H., 2018. Promoting customer brand engagement and brand loyalty through customer brand identification and value congruity. Spanish Journal of Marketing-ESIC.

Shanahan, T., Tran, T.P. and Taylor, E.C., 2019. Getting to know you: Social media personalization as a means of enhancing brand loyalty and perceived quality. Journal of Retailing and Consumer Services, 47, pp.57-65.

telegraph.co.uk, 2021. Are loyalty programmes actually encouraging customers to stay faithful?. [online] The Telegraph. Available at: https://www.telegraph.co.uk/connect/better-business/leadership/accenture/brand-loyalty-challenges-and-expectations/ [Accessed 1 February 2021].

Woratschek, H., Horbel, C. and Popp, B., 2020. Determining customer satisfaction and loyalty from a value co-creation perspective. The Service Industries Journal, 40(11-12), pp.777-799.

Yadav, M. and Rahman, Z., 2018. The influence of social media marketing activities on customer loyalty: A study of e-commerce industry. Benchmarking: An International Journal.

Yuniari, W., 2020. The Role of Customer Brand Engagement and Affective Brand Commitment in Mediating the Relationship between Value Congruity and Brand Loyalty. Journal of Advanced Research in Dynamical and Control Systems, 12(SP4), pp.1963-1973.

Zameer, H., Wang, Y., Yasmeen, H. and Ahmed, W., 2019. Modeling the role of service quality, customer satisfaction and customer loyalty in building service brand equity. International Journal of Asian Business and Information Management (IJABIM), 10(2), pp.55-72.

4


FAQ's