Being a product, service or concept, a brand publicly distinguishes an organization’s products or services from competition and relates its reputation to consumer needs and expectations in local and global markets. Typically being uniquely marketed, authentic and distinctive, a brand name portrays the positioning of a firm in relation to its competitors, but also the personality of the firm in consumers’ minds. In the psychology of Marketing, particular brands are related to a particular emotional stimulus that is constant and repetitive. Consumers’ brains respond easier to well-recognized brands. This explains why in the minds of consumers Lexus echoes pursuit of perfection, Apple, innovation and design and Sony, amazing game consoles.
A strong brand stimulates certain expectations that need to be met. Consumer expectations are shaped based on numerous factors that relate to their direct or indirect past buying experience, brand associations, the firm’s promotional and communication policies, the competitors’ positioning, individual beliefs about the firm, word-of-mouth, and price. It is interesting how price is the last factor consumers consider as important when they enter into a purchase decision. This is because what they primarily hope for is to satisfy their expectations by trusting a brand they feel is reliable and strong. In this context, brand loyalty occurs as a result of customer satisfaction. Consumers commit to a preferable brand based on favorable attitudes and behavioral responses rather than on price preferences.
> Behavioral brand loyalty
According to the traditional hierarchy of effects model, marketing communications audiences respond to brand messages in a structured way. Consumers act cognitively (thinking), affectively (feeling), and conatively (doing) and brand loyalty evolves as a result of customer satisfaction, expressed in repeated purchases. In this context, behavioral brand loyalty develops through a step-wise process that ranges from product awareness to actual purchase. Integrated brand communications attain different communication goals at each step of the process and reward brand loyalty. In return, consumers express their loyalty by repeated purchases, which, however, are purely based on customer satisfaction. Therefore, if customer perceptions about the firm change, the firm’s branding strategy may fail in the context of brand loyalty.
> Attitudinal brand loyalty
In the Psychology of Marketing, consumers’ attitudes are stronger towards larger brands because they consider them as ‘prospects’ as opposed to weaker brands that are considered ‘vulnerables’. ‘Prospects’ brands tend to increase their market share because consumers express a favorable attitude which is reflected with a long-term preference or commitment towards their products or services. In this context, consumers express an extreme attitude towards specific brands, known as brand insistence. Brand insistence often explains why consumers resist changing their attitude towards preferable brands, which leads to persistent attitudinal durability, attitude extremity, and ultimately, attitudinal brand loyalty.
Both behavioral and attitudinal brand loyalty are subject to the impact of advertising. Typically, the volume of purchase of loyal customers is directly proportional to the increase of advertising. In contrast, increased advertising does not affect non-loyal customers. In effect, advertising sets a framework that shapes the minds of consumers in relation to the brand usage experience, helping them to focus on the positive attributes of the brand. In this context, advertising stimulates positive feelings about a brand and creates expectations about the brand. After the usage experience, and provided the expectations are met, all prior advertising impact turns into brand loyalty because consumers can make sense of their experience with the brand.
The benefits of brand loyalty are significant both for consumers and companies. Loyal consumers are less-price sensitive and, therefore, willing to pay a higher price for a product or service. Feeling comfortable when buying a particular brand and conveying a message of achieved expectation, loyal customers are strong advocates of the brand influencing the decision making of other people. Besides, loyal customers typically have a higher tolerance for mistakes because they have a high degree of credibility towards a particular brand.
For companies, brand loyalty leads to increased market share and higher profitability through word of mouth advertisement and enhanced reputation. Improved reputation lowers vulnerability to competitive marketing actions and increases marketing communication effectiveness, ultimately increasing shareholder value and generating more brand extension opportunities.
A strong brand is more than just a logo or a name; it’s a promise that can be trusted. Brand loyalty is the result of customer satisfaction and commitment. Loyal customers trust the company and act as reference groups increasing the firm’s status and success.