The consumer is an infidel. Marketers might take a stronger exception, to this rather strong statement. But the truth, not sugar coated, is out in the open. Scan any market and you will observe that consumers follow loyalty only in the breach, be it in fashion, technology, durables and even careers. We say what we say because loyalty, or the lack of it, goes beyond brand loyalty to a larger societal shift in the way consumers view loyalty, and disloyalty. Staying loyal to your employer, career, or for that matter... relationship is no longer sacrosanct.
That possibly explains entrepreneurs spotting business opportunities and the rise of portals like second shaadi, second career and so on. Speak to the so called ‘disloyal’ consumer and you are likely to spot a sentiment that says “Loyalty , what’s that?” or “Oh, you are so old-fashioned” . That disloyalty-is-cool is also being reflected in the advertising of these times. The Airtel Digital TV commercial featuring Saif Ali Khan ditching his childhood sweetheart in a nano-second is just one illustration. On YouTube only a minor part of the comments on the ad actually express anguish over the fact that Saif changes his mind after one fleeting glance and opts for Kareena Kapoor. (The majority are more interested in details like the singer of the ad jingle or how the jilted model looks better than Kareena Kapoor.) However, there are still some pockets where you will continue to see some semblance of loyalty.
But these are the exceptions where consumers are forced to stay in a relationship with a brand because of the associated problems in changing service providers — for a gas connection, electricity supply or staying with the same telecom services provider to hold on to the phone number. Marketers do not buy these arguments very easily . For them loyalty is anything but dead. “How else do you explain Nokia’s dominant market share in cellphones,” asks D Shivakumar, managing director, Nokia. Others like Sanjay Purohit, director-marketing , Cadbury agrees that “experimentation is now a part of life for consumers who are forever seeking variety” but does not see it as a problem that’s going out of hand.
However, there is a mounting stack of evidence to suggest that few companies are prepared to tackle the evolving consumer. A study by ClozR, ad agency Dentsu’s customer relationship and loyalty division suggests that only 60% of companies even have a stated plan of dealing with customers. Worse, most managers have discounted the accuracy of their customer contact information, with estimates varying from as low as 40% to 55%.
Sandeep Goyal, chairman , Dentsu says that loyalty, if any exists today, is by default as the choice consumers make when all other factors are constant.
According to social scientist Shiv Viswanathan, the loyalty quotient is defined by the community you belong to, the status you have, the friendships you make and above all the memories that connect these worlds. He says, “The loyalty quotient has gone beyond the patriotism of the thing, to loyalty to an ecology.” But this ecology is fragile. For instance, see how the concept of friendship has evolved. Earlier people had a few “thick and fast friends” . Today, friendships are defined by the number of connections on your social network. The more friends, the better is your social status . It’s widely accepted that these friends are not forever . One bad experience and the relationship is finished for good. Ditto with brands. “There are too many of them in the market and the relationships between consumers and brands are not as thick as it would be in the past,” says Ashish Misra, chief strategist and business head of Mudra’s brand strategy division Water.
Brand marketers however disagree that consumers today are outright flirts, or even that they look at all brands with the same pair of lens. You will always have a few good friends and similarly a few close brands, is their argument. But even in this set of beliefs the tenets of loyalty are being redefined. For the traditional concept of brand loyalty as we knew it — consumers staying loyal to a single brand in a given category at any point of time — is on the verge of extinction. “Even if consumers switch between brands, they will always switch within a given consideration set,” reasons Shivakumar. And belonging to that consideration set can vary depending on what category one belongs to. If the ability to innovate ensures your entry into the consideration set in the case of mobile handsets, it is “the loyalty towards the country of origin is high in automobiles ,” as Neeraj Garg, director, Volkswagen puts it. In the spirits business , consumers choose their brand and even variety of spirits according to occasion , companions and the time of the day they are consumed, says Amrit Thomas, EVP, marketing, United Spirits.
For example , the same consumer might order for white spirits when they are in the company of females, but order whisky when they are in an all male group. Similarly , the same consumer might consume chilled beer in the comfort of home on a sunny afternoon. If that was bad enough, the brands consumed on each of these opportunities could belong to different companies. But if you thought this type of behaviour was typically male, Nadia Chauhan, joint managing director, Parle Agro shatters that perception. “Let’s be warned.
Women in metros are slowly imbibing qualities that we’ve always associated with men,” she says and adds that this is seen even in their relationship with brands. “They experiment, they flirt and they change their minds as often as their male counterparts do. Considering that these are women with money to spend, marketers have taken notice of this trend of disloyal women consumers.”
Battle of the sexes aside, the behaviour according to advertising veteran Anand Halve, has a lot to do with the change in emotions. “Earlier consumers had a loyalty equation based on the emotion that ‘you have done so much for me over the years’ . Now the ‘what have you done for me lately’ question often surfaces.” That question has become a nagging one, even in categories once considered to be having the highest loyalty quotients - foods and skin care for example. To ensure that such consumers do not desert your brand in droves, it is necessary to ensure that there are enough safeguards in place. “You have to protect yourself against the next big innovation,” says Shivakumar of Nokia. The handset maker does so by launching one new handset model every two weeks and is also graduating into services in a big way. Cadbury’s on its part says Purohit offers what consumers want — variety. In the UK for instance, Dairy Milk the company’s mother brand has 27 variants.
But chlorophyll’s Halve warns that in catering to the consumer’s quest for variety you could run the risk of over-innovating . “You can innovate your way to hell.” According to Dentsu’s Goyal that’s one lesson brands could learn from those who breathe the L word everyday — the loyalty programme managers. In the past, loyalty programmes would send you brochures offering discounts on everything from delivering bouquets to buying chocolates, irrespective of whether it was an airline or a department store. “Loyalty itself got commoditised. Only when you stay relevant to your primary category does the value of loyalty go up,” he says and adds that companies are learning from their mistakes. But as Viswanathan says, what is loyalty today, might not be loyalty tomorrow .
“The loyalty quotient is a circle of memory. They are not numbers which provide an index of loyalty but a polysemic notion where a thing is tied to ideas like friendship, joy, everydayness and their beauty,” he says. Probably, loyalty is due for rebirth. Another day, another time, and another form. Science Of The Times The trouble with concepts like loyalty is that they float happily about reality and yet seem to define the real for people who make decisions around markets. Taken seriously loyalty quotients like the word mid-life crisis, say too much and too little. Taken playfully, it shows connections that we may not otherwise think about. For example, brand loyalty is a bit like a love affair. As a philosopher once said, the thing about love is the amount of tension it can stand. To love a product is not like loving a human being. But when a product is treated like a human being, brand loyalty is born. The irony is, instead of loyalty being defined by patriotism or ethnicity, it is defined by brand loyalty. What I mean by this is that the loyalty quotient is contoured. The community you belong, the status you have, the friendships you make but above all the memories that connect these worlds define a loyalty quotient.