The other day Amazon announced it would be raising the price of its popular service Prime from $99.00 to $119.00 annually or from $10.99 to $12.99 per month. It is not likely that this increase will negatively influence its many subscribers, annoy them but a mass exodus of Prime service would be a surprise. When you consider the data issues that Facebook has recently dealt with, Facebook users remain engaged. However, both situations got me thinking about how brand loyalty can shift to brand dependency which can lead to brand resentment if a company is not careful how it serves its customers.
We as customers want to believe we are in control. We do not want to feel sold to and often do not like to admit that great marketing and products are doing just that. As companies bring us new innovations promising new experiences, our interest intensifies and our desire to possess increases. We make the purchase, want to have the brand experience and when it meets and/or exceeds our expectations we become loyal. We share our brand loyalty to our network, advocate its value and greatness and continue to engage if it meets our functional and most importantly emotional needs. Most companies like the idea of brand loyalty because it equals customer retention which almost always leads to company growth.
However, a byproduct of brand loyalty is brand dependency. It often occurs without the customer seeing it in the beginning as their rapture for the brand is so intense they ignore the obsession. The problem it fixed or the need it filled was so great that nothing else mattered. The issue is that most customers or businesses do not want to feel overly dependent on a product or service, and more importantly a brand. They want to know they can, at their will, change their mind without severe negative consequences. When they feel trapped, dependency leads to resentment and resentment leads to negativity. Negativity leads to people speaking ill will of a brand and this is where the brand becomes vulnerable.
If you look at some products and services (gasoline, medications, healthcare, etc.) that have captured audiences, audiences that cannot function without them, resentment increases when the customer has little choice but to pay up and accept the situation for what it is. While most brands do not create life or death dependency, dependency at some level exists as the customer loyalty grows and must be understood by the brand and its owners to maintain its long-term existence and have dependency turn to resentment.
There is no one solution to avoid brand dependency, the customer permits it to happen knowingly or unknowingly. To avoid brand resentment requires a delicate balance of insuring your value to your customer remains at an all-time high. Brand value comes from understanding your customers’ needs and then directing every touchpoint you use to maintain their awareness and loyalty to address those needs. When you begin to tinker with price, product features or reshape your marketing message to attract a new customer segment you risk building that resentment. This is not to say you should not do any of those things, however those strategies can unintentionally start a conversation that you are not directly a part of, where the customer begins to question the value of your brand and its relevancy to them.
So, what is a company with brands to do? Never forget the power your customer has over your company and brand’s existence. Companies and brands exist to have customers, serve them, and keep them engaged. If we take that for granted and do not take enough time to understand what they require and what problems they have (yes, that means doing research and looking beyond your data analytics) then we risk being irrelevant to them. The size, presence, products and services offered by your brand may create brand dependency, but avoiding resentment comes when you take the time to understand how your customers value what you offer. If you dismiss this, try to sell them unnecessary solutions, increase your price points without increasing your value, and take for granted their loyalty, do not be surprised when they come to your door with “pitchforks and torches.”
Now, the people of Amazon and Facebook are far smarter than I when it comes to knowing how far they can take their customers, they are the experts at big data. However, history has shown us that even the mightiest can fall when they take for granted the customer they have served for so long… every non-e-retailor is learning that lesson the hard way because Amazon has taken the time to understand their customers.
If you are interested in how my organization can identify what your customers value and what the prospects you lost did not, take a look at how we identify that insight. Win Loss Analysis
This approach puts you on the path to building brand loyalty that never becomes brand resentment.