http://www.echeat.com/essay.php?

t=27492
http://www.intage.co.jp/express/03_12/global/index.html
 Brand loyalty is not dead, it's just more like loyalty to a girl/boyfriend than loyalty to a
husband/wife.
[ Gili 27-Jan-2005 ]

Hey 'Pretty Funny' with all due respect all I can say is I am then surrounded constantly by
well educated people buying unbranded items for cost effectiveness even though they have
disposable income --I refer here to the rich middle class of the west -- so your reasoning of
them willing to take a chance on it being defective is then a tad flawed -- as it defeats the
reasoning behind their purchase decision. If you are referring to the affluent then it's your
point. I assumed we weren't discussing Ivanka Trump's brand loyalty.

Secondly, as an educated consumer I don't always agree that a store brand product is
equivalent to a branded one minus the bells and whistles. I, as I mentioned below, possibly
fall into the discerning 'educated' consumer who sees the minor differences and is brand loyal
depending on the accomplishment level of the brand.
[ Neha Wallia 24-Jan-2005 ]

Brand loyalty - dead or alive. Loyalty is as alive as creativity.

[ Mike Franklin, Brand Manager 24-Jan-2005 ]

Cheatin' hearts -- everyone is a cheatin heart, it just depends on the product and if we can
justify in our own minds if the product quality is 'just as good.'

True Love -- I would say that we define who brands are, they don't define us. Companies
spend millions to get inside our brains to develop a better product, so I say that consumers
create the brand, companies only fulfill our needs and wants.
[ David Rose 21-Jan-2005 ]

Ha, that last comment is pretty funny (or ignorant). It's common knowledge that private
label goods (ie, those with no brand attached) sell better among more affluent consumers b/c
these people have disposable income (and higher education usually) to 'waste' in case the
product turned out to be not as high quality. The higher ed part comes in that they are smart
enough to realize that the store brand is generally the same product as the branded product,
but the consumer is not paying for advertising and marketing.

So brands do best in developing and poorer regions where people are not willing to take a
chance on an inferior product b/c they have a limited amount of money and they want to be
absolutely sure that they get the best quality.
[ Anonymous 20-Jan-2005 ]

Brands will always retain their allure with sophisticated consumers who can see the
difference between shades of grey. The unfortunate side to this is there are a very few number
of people high earning or otherwise who are so discerning.

For the other side it can be said a Rolex can never be replaced by a similar looking Tag or an
Omega but it has taken decades for it to reach that level of 'respect.' All I'm stating is that for a
Same old story: Exchange old for new
SAMIDHA SHARMA
TIMES NEWS NETWORK[ SATURDAY, FEBRUARY 17, 2007 01:06:44
AM]

NEW DELHI: It’s yesterday once again in the Rs 25,000-crore electronics &
durable market in the country. The ubiquitous exchange programme of mid 1990s is
quietly making a comeback of late, though marketers this time are loathe to call it that,
and instead terming it as an ‘upgrade scheme’. Interestingly, this time it’s the market
leader, Rs 8,250-crore LG India, which has initiated the exchange scheme through LG
First, and not a challenger like Japanese consumer electronic brand Akai under Kabir
Mulchandani in the 1990s.

Though it’s still early days (LG First was launched early this month), with competing
marketers watching LG’s move with caution, it’s clear that in a highly competitive
market they have to follow on the market leaders footsteps or at least counter effectively
with some other marketing programme at the dealer or the consumer level. Mirc
Electronics, the maker of Onida brand, is already priming itself to launch an “equally
attractive programme” according to its VP (sales) Vivek Sharma.

Though wary of LG’s motive in resorting to such a scheme, other big durable makers
such as Samsung, Whirlpool, Godrej and Haier are in no mood to let LG walk away
unchallenged, though currently they’re keeping a business-as-usual demeanor and their
cards close to the chest. “We won’t let competition dictate our strategy, though tactically,
we will fight with whatever it takes,” says Whirlpool of India MD Arvind Uppal.

LG’s closest competitor, Samsung India, says it’s not following suit (at least for now).
“Our approach is to grow by tapping existing segments as well as creating new segments
in the market through innovative product launches. In terms of promotions, we provide
value-added offers to consumers — offers that complement the product category and help
it grow rather than price discounts,” says Samsung India deputy MD Ravinder Zutshi.

LG First operates in such a way that the customers can bring in any durable or electronic
product from any brand and get them evaluated. Once the evaluation is done, the
customer will get a cash voucher which can be redeemed on the purchase of any LG
product within a time period of three months. “The LG First initiative is aimed at making
upgradation for our customers easier, which is becoming a very significant phenomenon
in mature markets. This would also help build brand loyalty within our customer base,”
says LG India marketing head Sandeep Tiwari.

Though LG maintains that ‘First’ is an ongoing consumer programme, competitors are

incredulous as ever. At best, they view it as a good tactical move to leverage LG’s
official partner status for the upcoming ICC World Cup Cricket. At worst, many call it a
 desperate attempt by the Korean chaebol to perk up its topline, having missed the much
touted Rs 9,000-crore sales in 2006. “Keeping in mind the Cricket World Cup, it seems
like a timely and relevant marketing move from LG,” adds Mirc’s Mr Sharma.

“What we are doing now is not merely a sales promotion, it’s an attempt to filter all those
freebies and instead drive initiatives at the service level to differentiate the brand from
any other,” counters LG’s Mr Tiwari on competitive claims of LG first being a plain-
vanilla ‘exchange scheme’ of yore. He also rattles off a host of other ‘brand-centric’
initiative by LG to focus on only the high-end of the market, even in its communication.
But not everyone agrees. “Replacement offers have been run by us for almost three years
and they are a regular phenomenon. It’s just that they are doing an organised
communication of it. We have done this with the help of our service force for very long,”
says Godrej Appliances vice-president, sales Kamal Nandi.

“Exchange schemes have been there. It’s just that LG has branded it. We would have
some scheme of our own once we near the World Cup. Every player in the market will
have something to counter it since a large part (over 70%) of high-end products is
through upgradation,” says Haier India director Pranay Dhabhai.

Few Definitions:

A strongly motivated and long standing decision to purchase a particular product or

service.

A marketing objective designed to attract young consumers to a brand with the hope they
will always use that brand. Consumers are becoming increasingly less brand loyal with
more and more products to choose from.

The degree of consumer preference for one brand compared to close substitutes; it is
often measured statistically in consumer marketing research

The degree to which a customer is loyal to a given brand in that they are likely to re-
purchase/re-use in the future. The level of loyalty indicates the degree to which a brand is
protected form competitors.

The inclination to continue buying the same brand.

In marketing, Brand loyalty is the strongest measure of a brand's value, it can be

demonstrated by repeated buying of a product or service, of a good word of mouth and
advocation of a product or service. Even with the available of other alternatives.
Brand image; creating differentiation for competitive advantage
It can be useful to think of brands as people. Like a person, a brand has a name, a
personality, physical features and a family. At the same time a brand either consciously
or by the nature of its being, projects a certain style and image. Our perceptions of the
brand are determined by our interactions with it, from first impressions to deeper
knowledge and awareness, and its behavior and attitude towards us dictate ours towards
it. We develop relationships with brands as we do with people, gradually becoming more
relaxed around them and letting them into our lives as we trust them more and more.
Human relationships flourish with good communication and the same is true in our
relationships with brands. If a brand suddenly changes without explanation it confuses us,
as it does when a friend takes on a completely different persona. We value honesty,
trustworthiness and reliability in people, and we look for the same in a brand.
The end goal of branding is always to create preference and influence choice, and the
corporate brand is central to achieving this by acting as point of reference for actions
concerning all aspects of the business. One major reason for the rise in importance of the
corporate brand is that it is becoming harder and harder for product brands to create
preference on their own. This is due in part to the proliferation of similar goods and
services as well as factors such as price wars, which make promotional activities at the
product brand level a survival strategy. As a result, corporations need to look at how each
business area can contribute to brand reputation and the reinforcement of company
values. Again, it comes back to the idea that the brand must 'own' a place in the mind of
the consumer.

Branding in the retail and consumer goods world

The consumer goods and retail world touched upon above is a good example to help put
all of this into a bit more context. With the widely acknowledged power shift from
manufacturers to the retailer, national power brands have become less potent than they
once were and retail brands now dominate many categories. There has also been a shift
from brand management to category management, meaning that dynamics have changed
greatly and manufacturers are pressed to contribute to the health of the category as a
whole rather than separate product brands. The implications for manufacturers are that
more than ever, the corporate brand must be relevant and exciting in the eyes of the
consumer in order to provide value to the retailer and category as a whole. Although the
dynamics of the retailer - manufacturer relationship are changing and the outcome is hard
to predict, it is undeniable that a strong and proven brand can only help the manufacturers
react to the situation positively.
At the same time retailers are moving towards developing customized relationships with
consumers in an attempt to exploit the lifetime value of a customer rather than each
separate transaction. Innovative retailers such as Loblaws in Canada are looking back to
the lessons of Mom & Pop stores through branding exercises that try to recreate the
intimate neighborhood atmosphere of the high street under the single roof of their
supermarkets. This is experiential marketing that puts much more emphasis on the brand
environment in order to create a destination brand for the consumer. Retailers realize that
it costs considerably more to attract a new customer than to keep a loyal one, and in order
to maintain the loyalty of current customers they are fighting to provide differentiation
from their competitors so that they can give the consumer a compelling reason to keep
coming back.

Building trust and loyalty as brand strategy

Increasingly on the practical side companies need to create one to one relationships
whereby they tailor their offer to individual customers. The customer is King and the
business style of Henry Ford's 'you can have any color as long as it is black' are obviously
no longer an option. To use another auto related example, the future may well lie in
business strategies such as the recent Virgin Cars venture in Manchester, England. Here
not only different colors of car but also competing brands can be found side by side for
sale under the same roof. People like to shop around and compare different brands and
Virgin solved the hassle of having to traipse from dealer to dealer. However, in order to
credibly communicate corporate values and contribute to the reputation of the brand,
companies have to be in touch with people's personalities, beliefs, and psychologies.
Responding to the emotional needs of consumers Virgin also delivers unbiased
salespeople who are compensated based on their people skills rather than sales figures, a
breath of fresh air compared to traditional dealers. This approach makes their advice far
more objective and leaves the customer more informed to make a decision that is right for
them.
Why can Virgin step out into a new and unproven area of retail, and from the look of
initial results probably create another successful business to add to Richard Branson's
portfolio? Well, the fact that the brand has built up a huge amount of emotional goodwill
in the consumer's mind as well as the reputation to deliver credibly and consistently on its
brand promise cannot do any harm. Virgin appears to be in touch right now with
customer psychology, finding and communicating on the same wavelength in an unforced
manner time after time. Through this they have become as close to the equivalent of a
friend to consumers as a corporation can hope to get.
It is of course essential however for even successful companies to constantly strive to
stay in touch with and remain dependable for their audience. A great many consumers
and shareholders battered by recent events in the global business world will today more
than ever be looking for stability as a determining factor in deciding with which
companies they will pursue a relationship. It is a fundamental issue at any time, but in a
climate such as the current one becomes even more vital, that brands prove they can be
trusted to stick around and deliver repeatedly on their promises. It is the brands that
manage to achieve this trust through a combination of people, product and delivery, that
will succeed in the long run in winning the battle for a place in the consumer's heart and
mind.

Conclusion
But brands aren't as powerful as alleged, nor is the public as easily manipulated. Many
established brands are in danger, losing customer loyalty. (Tom Barnes, Brands in Crisis)
People have become increasingly unreliable. Every age group is relatively equally
capricious. Brands are making more noise out of desperation. In the developed world,
people are becoming closer to self-actualization, as deficiency needs are met and we
move beyond them. Some traits consistently found in Maslow's self-actualizing subjects
were that they see through phoniness, deception, and 'games' and avoid them, such as
branding ploys. They cope with problems, rather than avoid them or find an answer in
brand names. They accept themselves and others. Who you are is different from the brand
you choose. They resent unfairness caused by social roles and prejudice, on which
branding relies. They think for themselves, even in the face of social criticism. As
humanity moves closer to self actualization, we will eventually disregard branding. But
until then, as I have explained in this essay, branding will continue to influence the
majority of lives significantly.

'Losing an illusion makes you wiser than finding a truth.' Ludwig Borne.

Brand Satisfaction Cures Fickleness -

And Chocolate
Selling to Kids, Sept 1, 1999

"Forget about brand loyalty, kids are fickle, fickle, fickle," insist conventional marketing
notions. "Not true," counters Donna Sabino, director of strategic planning and research,
Sports Illustrated for Kids, which just released the results of its latest omnibus study of
623 boys and girls 9 to 13. "I've never seen [brand disloyalty] happen with kids unless
you disappoint them."

Teens will stick with a brand as long as it continues to satisfy them (and the survey
results below suggest all it may take is adding chocolate). But if you change something -
formula, packaging, taste, style or ad message - without checking in with them, of course
you'll lose them, she says.

"That's not to say they won't try new things. They will." Then they'll come back to the
products that satisfy them, says Sabino.

Of course kids change quickly, but that doesn't mean you have to constantly modify your
product. You have to stay in touch with kids' expectations, whether the product is food,
media or clothes. Keep checking in to find out what kids know about you and how
closely it matches what you want them to know.
Take cars, for example. "Once [kids] turn 12, imports are way ahead of American cars"
on their wish lists, says Sabino. So a smart American car maker would listen to these
words from the future generation - and current influencers - of car buyers, then ask them,
"what's wrong with American cars?" and "what's so great about imports?" The car maker
would be wise to apply the answers to future designs and marketing campaigns.

A Day Without Chocolate...

Smart marketers in any industry know that food is close to kids' hearts so the survey
asked kids 9-13 which of a dozen foods and drinks they consume two or more days a
week. "I was surprised by how many kids (23%) eat chocolate candy every single day,"
says Sabino, who has been involved with the omnibus study since 1991. Sixty-six percent
of respondents ate chocolate at least twice a week. Cold cereal is the only food category
named by more kids (73%).

A Pitch for Talking to Kids

Sabino makes a pitch for focusing marketing to kids as opposed to moms when she
suggests what marketers should conclude from these findings:

"When [kids] use a product that much, they become an expert - a gourmet. While they're
developing tastes, get in there with your marketing," says Sabino. Although she says,
"I'm not saying mom isn't buying a lot of the time, but kids are the ultimate consumers.
They won't sit quietly by and eat what they don't like."

The high marks for cereal and chocolate are undoubtedly good news to two of the full-
page advertisers in SIFK's September issue, including Kellogg's Apple Jacks and Mars' 3
Musketeers .

In fact, the choice of foods in this question mirrors other full-page advertisers, including
Coca Cola, NesQuik and National Fluid Milk Processor Promotion Board and it's no
coincidence: "We try to get information that will be relevant to the market, that shows
what goes on in kids' world," the same criteria advertisers use when they're buying space.

What, No Hamburgers?

If the choice of questions were deliberately matched to advertisers, with McDonald's as a

full-page advertiser, you might expect to find hamburgers on the list of most frequently
consumed foods, instead of lunch meat and hot dogs. With lunch meat consumed at least
twice a week by 62% and every day by 22%, the study might cause that restaurant and
others to consider a menu addition.

Washing It Down

Even more universal in the food/drink question than cereal and chocolate are soft drink
(83%) and milk (78%) consumption. Boys (85%) are a little thirstier for soft drinks than
girls (81%). The gender gap's even greater in milk consumption (82% of boys versus
74% of girls), which also falls off in the older group (75% compared to 81% for kids 9 to
11). Boys (50%) also consume more sports drinks than girls (42%).

So with boys drinking more soda, milk and sports drinks than girls, you might wonder
how girls are washing down their greater consumption of crackers (40% compared to
31% of boys). Could it be with yogurt?

The survey asked kids to name their favorite brand of yogurt and where and when they
eat it. (No yogurts are advertised in SIFK, nor did they make the top 12 list of foods and
drinks. But we wouldn't be surprised to see a yogurt ad in an upcoming issue because,
Sabino says, the question was a special request from the category manager who had been
unable to find the info elsewhere.) Dannon and Jell-O tied for tops, followed by Yoplait,
Breyers, Columbo and Brown Cow. Kids eat yogurt mostly at home and after school.

(Donna Sabino, SIFK, 212/522-2580)

What Kids Eat/Drink At Least 2 Days a Week

To get kids to respond, stock your ad and market research
larders with
these frequent consumables.
Total Kids Surveyed: 623

soda . . . . . . . . . . 83%
milk . . . . . . . . . . 78%
cold cereal. . . . . . . 73%
chocolate candy. . . . . 66%
potato chips . . . . . . 62%
lunch meat/cold cuts . . 62%
non-chocolate candy. . . 59%
cookies. . . . . . . . . 58%
sports drinks. . . . . . 46%
crackers . . . . . . . . 35%
hot dogs . . . . . . . . 30%
yogurt . . . . . . . . . 22%