Key to Offsetting Drop in Brand Loyalty is Innovative Advertising, Not Price Cuts
Lost in a recent report from CNW Marketing Research on the dramatic decline in brand loyalty by American car buyers is the answer the firm also provided to offset that ruinous trend: innovative advertising in both internet and traditional media and resistance to discounting as much as possible.
Brand loyalty in the broad sense, is gone, CNW president Art Spinella says in his October report, but attention to overall product quality and understanding the dynamics of peer pressure can bring new customers into the fold and retain those who are already brand loyal. Spinella points to Hyundai and Kia as examples of companies who have embraced the value of overall product quality as a marketing strategy, and commends Ford for its innovative Fiesta campaign that uses the internet and traditional media in novel ways to break down the barrier between the youth market and Detroit products.
Family history is no longer the driver of brand loyalty, CNW reports, because the traditional family as it is commonly known no longer exists. Buyers get their brand cues from the behavior of people in their peer groups, the firm says, noting that teachers, for example, are particularly fond of Toyota and Honda models. Automakers and dealers should focus their efforts on understanding these groups and developing ad strategies that resonate with them, CNW says. It notes Fords Fiesta campaign has already successfully encouraged a demographic group that tends toward Asian vehicles to consider the Fiesta as a realistic alternative to Honda and Toyota.
CNW says price discounting should be left to companies like Wal-Mart because such behavior does nothing for brand loyalty. Discounting the $31,000 average price of a new car or truck may make it easier to buy the vehicle, CNW says, but it does not guarantee the buyer will stick with the brand or convince anyone related to the buyer to also buy the product.
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