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Where Brands Strike Gold and Make Money, Emotional Engagement

Brand Keys announced the results of our 17th annual Customer Loyalty Engagement Index (CLEI) this week. We ended up with 54 categories and nearly 400 brands. And if you’re interested in seeing how brands ranked in your product or service category, just click here.

We say “ended up with” because a number of categories no longer appear in the CLEI. This was due to neither lack of interest nor hubris, but the fact that it would be more accurate to characterize those categories as no longer being “brand-based.”

By that we mean they include products that consumers used to view as ‘brands,’ and still know the names of, but are now being regarded as so completely comparable in all key attributes that drive purchase, as to be the same. So not “brands.” In addition, the importance of “brand” significantly decreased or disappeared altogether as engagement and loyalty contributors in these categories! So, again, not brands, and not surprising when all things are considered equal. You can call them “category placeholders,” but you can’t really call them “brands.” When all a consumer can say is “shampoo,” when asked about the product name, you really aren’t a brand anymore. If you don’t stand for something, you’ll never be able to differentiate yourself on an emotional basis.

And if that wasn’t bad enough – brand becoming less important than price – technology has also “genetically modified” some categories. So while the categories and brands in the categories still exist, they are shrinking rapidly, with consumers migrating in other directions. There were 5 categories like that this year: Cellphones (with consumers moving to smartphones), Digital Point & Shoot cameras (with consumers moving to smartphones), Digital SLR cameras (with consumers moving to smartphones), and Blu-Ray players, and Movie Rentals (no, not smartphones. This time, tablets).

Four categories we’ve measured in past years have gotten so “compressed” in terms of the actual number of competitors, that there is no longer a reasonable inventory of national brands to examine (which is why the Retail Electronics category disappeared from the Index several years ago). This year those included Drug Stores, Retail Office Supplies, Price Clubs, and Packaged Ice Cream.

According to 39,000 consumers, 18 to 65 years of age, drawn from the nine US Census Regions, who self-selected the categories in which they are consumers, and the products and services for which they are customers, the desire for real brands is driven by emotional engagement. If you know where that emotional engagement is in your category, you’ll know not only how consumers will behave, but most importantly, you’ll know what will get them to behave more positively toward your brand versus your competitors.

Which only matters, of course, if you’re keeping score by counting your sales and profits, and not merely tracking awareness, calculating coupon redemption rates, or counting tweets.

So the dramatic brand changes this year serves as a ‘bellwether’ for marketing managers. It will be the products and services that dig in the right emotional place, and build real emotional consumer engagement, that will ultimately strike consumer gold.

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About Passikoff and Shea

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Public Profile

Robert Passikoff, founder and president of Brand Keys, is a sought-after speaker and global thought leader on engagement and loyalty. He has pioneered work in these areas, creating the Customer Loyalty Engagement Index and the Sports Fan Loyalty Index. In 2008, New York University’s communication school declared Dr. Passikoff “the most-quoted brand consultant in the United States.”

Amy Shea, EVP Global Director of Brand Keys’ Brand Development, has worked with brands for over 20 years, translating research-based insights into strategically effective marketing and communications. Her contribution was recognized with the David Ogilvy Excellence Award, with both the Grand Ogilvy and 1st in Category awarded for the research behind IBM’s ground-breaking integration campaign.Passikoff and Shea's marketing column Peeking at 21st Century Brands is syndicated to Blue MauMau by permission of Brand Keys.

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Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

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Franchise Operations