Identity Loyalty
Connecting the Brand
and the Customer
Dr. Americus Reed, II Ph.D.
Professor: Wharton School of Business
Partner: Persona Partners LLP
Share Your Memories #WhartonReunion
Part 1:
An Introduction and example(s) of the power of Brand Associations
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
What makes these brands so iconic?
Share Your Memories #WhartonReunion
Key Point(s) – What does a “Brand” do?
•
Branding…
…creates a rich, consistent and clear meaning
system that defines what the brand stands for.
•
Good Branding…
…differentiates from competitors and connects
consumers to the brand creating loyalty.
•
Great Branding…
…connects in a way that consumers internalize the
brand as an expression of who they are or who
they want to be. Identity Loyalty
Share Your Memories #WhartonReunion
Part 2:
The Case for why you should re‐examine your firm’s Brand Building Strategy
Share Your Memories #WhartonReunion
WHICH ONE WOULD YOU CHOOSE?
Share Your Memories #WhartonReunion
WHICH ONE WOULD YOU CHOOSE?
Share Your Memories #WhartonReunion
A strong Brand makes you stronger
when its brand promise reassures you
1Park, Ji
Kyung and Deborah Roedder John (2014), “I Think I Can, I Think I Can: Brand Use, Self‐Efficacy, and Performance” Journal of Marketing Research , LI, 233‐247.
Share Your Memories #WhartonReunion
CAN YOU BELIEVE IT?
EXAMPLE from MSN Money
http://video.msn.com/
Share Your Memories #WhartonReunion
CAN YOU BELIEVE IT?
Share Your Memories #WhartonReunion
What is a brand worth?
Share Your Memories #WhartonReunion
Part 3:
Introducing the Powerful Concept of Identity Loyalty
Share Your Memories #WhartonReunion
The Typical Approach to Product (Feature) based
marketing can be strengthened by putting the
consumer’s identity center stage (The Why)
“….People don’t buy what you do they buy why you do it……”1
“……The traditional question of how can I convince consumers my product has superior features is wrongheaded. It focuses on "What" and reflects a transparent attempt to sell a product. However, the question of, ‘WHY would my customers use my brand to define themselves?’ is deeper. This question reflects alignment of a consumer's identity with what the brand stands for…..”2
1Sinek, Simon “How Great Leaders Inspire Action” TED
2Reed II, Americus “Why Apple Fans Will (Almost) Always Defend Them.”
Share Your Memories #WhartonReunion
External factors are not enough. Smart
brands connect to us internally through a
dynamic called
Identity Loyalty
Identity loyalty is when the values and ideals of
the brand are perceived by the customer to be in
tune, or aligned with their own to the extent that
the brand comes to represent the self and the self
represents the brand.
Share Your Memories #WhartonReunion
Identity Loyalty manifests in 3 very distinct
behaviors that signal a deeper connection
and alignment with the brand
1. Customers voluntarily become willing brand
ambassadors
2. Customers are willing and do pay more despite
having more affordable options
3. Customers vehemently defend the brand
Share Your Memories #WhartonReunion
Anecdotal Evidence of Identity Loyalty
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Quantitative Evidence of Identity Loyalty
Share Your Memories #WhartonReunion
Emotional Attachment with Brands Predicts Brand Loyalty and Acceptability of Price Premiums
1Thompson, Matthew, Deborah J. MacInnis
and C. Whan Park (2005), “The Ties That Bind: Measuring the Strength of Consumers' Emotional Attachments to Brands,” Journal of Consumer Psychology , 15(1), 77‐91.
Share Your Memories #WhartonReunion
Brand Attitude Strength is separate from and weaker than
Identity Loyalty in predicting Devotion Behavior
1Park C. Whan, Deborah J. MacInnis, Joseph Priester, Andreas B. Eisingerich and Dawn Iacobucci (2010), “Brand Attachment and Brand Attitude Strength: Conceptual and Empirical Differentiation of Two Critical Brand Equity Drivers” Journal of Marketing, Vol. 74 1 (November 2010), 1–17.
Share Your Memories #WhartonReunion
Relative Perceived Value of the Product is a WEAKER Switching Barrier than Customer Brand Identification—which even gets stronger over time
1Lam, Son K., Michael Ahearne, Ye Hu and Niels
Schillewaert (2010), “Resistance to Brand Switching When a Radically New Brand Is Introduced: A Social Identity Theory Perspective” Journal of Marketing, Vol. 74 (November 2010), 128–146.
Share Your Memories #WhartonReunion
Conspicuous Brand usage hurts the brand only for those w low Self‐Brand Connection
Who attribute the display to impression management
1Ferraro, Rosellina, Amna Kirmani and Ted Matherly
(2013), “Look at Me! Look at Me! Conspicuous
Brand Usage, Self‐Brand Connection, and Dilution” Journal of Marketing Research,
Vol. L (August 2013), 477–488.
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
Part 4:
The Steps to Strategically Assess your Customer’s Identity
Share Your Memories #WhartonReunion
Consumers have many Identities
•
•
•
•
The self has different components,
or identities, that are active at
specific times.
They cause us to prefer different
products and services.
Some of the identities are more
central than others (i.e. husband,
boss, student, athlete).
Other identities may be more
dominant in certain situations (i.e.
stamp collector, dancer, volunteer).
Share Your Memories #WhartonReunion
Use Clustering Methods to Create Identity Dimensions
and Connect them to Identity Loyalty and Product
Feature Preferences
Share Your Memories #WhartonReunion
When you misalign your brand identity with your customer’s identity you goof up
Share Your Memories #WhartonReunion
Strange Demographic Marketing out there
Share Your Memories #WhartonReunion
Share Your Memories #WhartonReunion
When you misalign your brand identity with your customer’s identity you goof up
Share Your Memories #WhartonReunion
When you misalign your brand identity with your customer’s identity you goof up
LANDS’ END
First Quarter 2014 Results:
Operating income increased 57.1% to $18.8 million compared to $12.0 million last year.
Net income increased 48.1% to $10.9 million compared to $7.3 million last year.
Adjusted EBITDA increased 35.2% to $23.8 million compared to $17.6 million last year.
Share Your Memories #WhartonReunion
Part 5:
The Steps for how to Strategically Assess your Brand’s Identity
Share Your Memories #WhartonReunion
Define what the brand seeks represent
Share Your Memories #WhartonReunion
The Best Way to Diagnose your Brand’s Identity
Conduct an Identity “Audit”
• As a Brand Builder—what is your brand’s narrative?
• Is it?
– Clear
– Consistent
– Well-differentiated
• Where does your brand identity “touch” your consumers? In what aspects
and in what ways of their day to day activities?
• How often do you think about your brand as a way to help make decisions?
Share Your Memories #WhartonReunion
A strong Brand makes you honest
When you think you are not making progress toward being an honest person
1Fitzsimmons, Grainne M., Tanya L. Chartrand and Gavan J. Fitzsimmons (2008), “Automatic Effects of Brand Exposure on Motivated Behavior: How Apple Makes You ‘Think Different’” Journal of Consumer Research , 35(1), 21‐35.
Share Your Memories #WhartonReunion
The Brand’s Identity (Good looking, feminine, glamorous) Rubs off on You when you believe your identity is fixed
1Park, Ji
Kyung and Deborah Roedder John (2010), “Got to Get You into My Life: Do Brand Personalities Rub Off on Consumers?” Journal of Consumer Research, Vol. 37, No. 4 (December 2010), pp. 655‐669.
Share Your Memories #WhartonReunion
Part 6:
The Steps for Nurturing Identity Loyalty
Share Your Memories #WhartonReunion
Step 1: Proactively Communicate your Brand’s Identity
Share Your Memories #WhartonReunion
Step 1: Proactively Communicate your Brand’s Identity
. . .else it becomes difficult to respond
Share Your Memories #WhartonReunion
Step 2: Fiercely protect your Brand Identity
….Invite customers to
join in
Share Your Memories #WhartonReunion
Step 3: Be genuine and authentic
The Brand’s Identity has to have credibility
Share Your Memories #WhartonReunion
Step 4: How your audiences are
responding to your brand
Do the research needed to understand your target audience
Share Your Memories #WhartonReunion
Step 5: Look for Meaningful ways to express your Brand’s Identity
Share Your Memories #WhartonReunion
Step 6: Use established and well
validated tools from the literature
Identity Loyalty is the goal that we as brand managers seek to achieve. There are
no short-cuts.
Share Your Memories #WhartonReunion
Step 7: Always “be thinking” about the next phase of your Brand’s Identity and How it aligns with Your Customer’s Identity
Share Your Memories #WhartonReunion
FINAL CRITICAL TAKEAWAYS
•Collect (BIG and Small) data on your customers at every opportunity—
USE IT!
•Use real customer data to develop the brand narrative
•Repeat purchases imply but do not guarantee loyalty
•Identity Loyalty relies less on external switching costs and more on
internal switching costs (abandon values, core principles, self notion)
•Depict your customers engaging with your brand in ways that they want to
see themselves engaging with your brand (Apple, Starbucks, Ford Trucks)
•Maintain authenticity or your efforts in Identity Loyalty will go unrewarded
Share Your Memories #WhartonReunion
Create Identity Loyalty and you can create THIS:
Share Your Memories #WhartonReunion
Thanks for your time
•
Contact Information
Dr. Americus Reed, II
amreed@wharton.upenn.edu
amreed@personapartnersltd.com
267-225-Reed (7333)
americusreed.com
Twitter: @amreed2
Share Your Memories #WhartonReunion