Brand Loyalty – How does it happen? From a good experience? From a bad experience with competing brands? What makes a person decide they will pay a higher price for one product over another SIMPLY because of its brand? How are some brands worth millions of dollars, like Coca Cola?
In my Marketing class, I was asked “Are you brand loyal? For what brands?” It was funny to hear this question directed toward me because among my friends I am known to base my purchasing decisions off of the brand. From Coca Cola to Red Bull to Verizon to LG to Poland Spring to even Advil (I NEVER take Tylenol), my decisions are based entirely off the name on the label of the package.
For example, I have always ADORED Verizon. I cannot even grasp the notion that I would ever have another cell phone carrier. However, with my Verizon phones, I will never buy a Motorola or Samsung phone; it will ALWAYS be LG (see my earlier blog post about LG phones). My first phone was an LG phone, and of course, I was in love with my phone being a teenager with a cool new “toy.” My next phone was a Samsung phone, and I went through 7 of them in a year and a half. I think my brand loyalty to LG was instilled after this bad experience because I refused to buy anything but an LG phone after that (my new two phones were LG, and I have been completely satisfied with them).
Clearly, that was an example of a good experience leading me to be brand loyal. But have you ever had a bad experience with another brand that pushed you to be brand loyal to a new brand? During Passover, I am stuck drinking water with a Kosher for Passover label. The brand: Evian. I know everyone thinks that all water tastes the same, but I bed to differ. I don’t know if it is the way the different companies purify the water or the plastic bottle they choose, but water tastes different to me. As for Evian water, I cannot STAND it! It may be because I drink only Evian during Passover, which is associated with other food that doesn’t taste good, but I have become 100% loyal to Poland Spring water. Even when I am at college, I buy Poland Spring bottles in bulk, even if that means carrying them from the convenience store to my apartment (even though I have beat the system by finding a place that delivers them to your doorstep with no shipping cost).
Another aspect of branding that surprises me is the amount of money some of these brands are worth. In 2009, Coca Cola’s brand value rose 3% to $68.73 billion according to Interbrand. (Among the other brands with top values are IBM, Google, Nintendo, and Sony.) How is a brand able to be worth THAT MUCH money? It is truly fascinating that a company can earn so much money off of a brand. Granted, everyone recognizes Coca Cola’s red color and font, but it is still impressive that they earn that much revenue through its brand recognition.
Brand loyalty surrounds my life, but how many other people base decisions off of brand loyalty? How many consumers would stick with an Apple iPod if another company came out with a similar iPod? How many consumers pay more for energy drinks like Red Bull when drinks like Monster are larger but cost less? (I am guilty to that one!) Stay tuned for another blog post about branding (our regional conference theme)!