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Unlearning Loyalty

Unlearning Loyalty
101 London’s Laurence Green on why he’s a believer of Byron Sharp’s brand penetration mantra.

A chippy Australian asking questions of England’s finest. It’s one of the enduring narratives of Ashes season but in this case the Aussie is a Professor of Marketing and the googly being bowled our industry’s misplaced belief that brand loyalty is the path to growth.

Byron Sharp’s ‘How Brands Grow’ was first published as long ago as 2010 but has proved something of a sleeper hit since, gradually gaining traction in agency strategic circles and client boardrooms. (A challenger at last to the cult of challenger branding!) And now the good Prof is on tour, one that culminates with him topping the bill at the IPA’s ‘Unlearn’ event on September 2nd, a kind of ‘Woodstock for Strategists’ to paraphrase Warren Buffett.

Sharp’s premise is a simple but powerful one and comes with the not inconsiderable bonus that it is based on empirical evidence rather than just opinion, however earnestly held. Building on decades of research conducted by the Ehrenberg Bass Institute, he demonstrates that if you carve most markets up you will find time and again that it is brand penetration – put simply, the number of users a brand has, heavy or light – and not frequency or loyalty that drives growth.

This shouldn’t come as too much of a surprise to marketing and advertising practitioners, not least keen students of the IPA’s Databank (which has reached a broadly similar conclusion over the years). But our industry’s historical aversion to marketing science and our tendency to indulge competing theories with an air of plausibility, has blindsided many to the underlying ‘laws’ of our business.

Sharp revels in this, subtitling his tome ‘What Marketers Don’t Know’ and poking regular fun at so called ‘medieval thinkers’, not least Kevin Roberts and his Lovemarks theory. (It remains to be seen whether KR will return to the crease and grab the game by the throat.)

Bodyline stuff, maybe, but table-thumping that we should welcome, even if we disagree. Sharp’s secret sauce is that in pitching his premise so starkly, he forces us all to take up a position: to bat on for loyalty (‘beyond reason’ or otherwise) or strike ever more confident blows against it as the motor for growth. At the very least, his findings and conclusions - imperfect as I’m sure they are - are a kind of prophylactic against lazy talk.

Time for me to declare my prejudice. I’m an unreconstructed Sharpist (a Sharpie?). I think he’s right to remind us all of the primacy of physical availability (a la Coke’s ‘within arms reach of desire’ objective). Right to characterise our audience as ‘polygamous loyalists’ who will shuttle happily across a mental shortlist of brands as ‘cognitive misers’ who just want to buy quickly and confidently. (Even if it’s a high ticket item. Especially if it’s a high ticket item.) Right that emotion and instinct drive brand choice, rather than considered deliberation, and that it’s better to be distinctive rather than different.

I’ve worked on too many campaigns and in too many categories that support his worldview to vote otherwise. And I’m taken by his demolition of outliers like Harley Davidson, whose largest customer segment by far comprises not ardent members of ‘the Harley club’ but instead folk who are disproportionally inclined to agree with the statement “I don’t know other people who like motorbikes”.

I’m less dismissive than Sharp is of those who still hold religiously to loyalty as growth engine, who would keep its candle burning brightly in this era of fans, communities, shares and likes. There will be exceptional circumstances where they are proved right, and indeed others where penetration growth is actually a function of brand loyalty and advocacy.

The case can always be made also that future behavioural dynamics will bear little resemblance to our past. Though just because you can order a Mighty Meaty pizza by tweeting Domino’s an emoji doesn’t mean that ‘everything’s changed’.

But my default hypothesis when asked to grow a brand is that we will, in all probability, do so most effectively by driving availability, throwing our targeting arms wide open, recognising our audience’s essential disinterest, standing out from our competitors and striking an emotional not rational chord.  Rather, that is, than building some kind of delusional country club for loyal users.

Our industry’s vanity can sometimes lead us astray, not least in overestimating the role of brands and advertising in people’s lives. We’d do well to remember that brands can still be incredibly important to their owners even if they aren’t that important to their buyers, because even weakly held consideration is still commercially consequential.

‘Nudging the behaviour of the largely indifferent’ may not get industry pulses racing as a crie de coeur but it is what most of us are doing, most of the time. Byron Sharp reminds us why we’re right to be doing just that.

Laurence Green is Founding Partner of 101 London

For further details about the IPA’s Unlearning: how marketing really works event on 2nd September, featuring Byron Sharp, Russell Davies, John Kearon, and more, visit  http://www.ipa.co.uk/events/unlearning-how-marketing-really-works

The opinions expressed here are those of the author and were submitted in accordance with the IPA's terms and conditions regarding the uploading and contribution of content to the IPA's newsletters, IPA website, or other IPA media, and should not be interpreted as representing the opinion of the IPA.

 

 

 

 

Last updated 16/07/2015

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