The one thing most likely to bring clients into your door (except a sign saying “Free Stuff) is some amount of customer loyalty. Customer loyalty is the lifeblood of a healthy business but there isn’t one finite way to achieve or cultivate it. The art of customer loyalty is as fluid (and sometimes fickle) as customers themselves; consider the wide variety of industries and equally wide variety of consumers in the world. There isn’t one way to pull in everybody but there are tried and tested methods sure to put your small business in the right mindset to cultivate customer loyalty. In celebration of customer loyalty month, join Kapitus on a weekly exploration of the most helpful concepts and theories used to bring about customer loyalty. To begin this series: let’s get heavy and understand “cognitive loyalty.”
What is Cognitive Loyalty
Cognitive Loyalty is a term created by Dr. Richard Oliver and explored in his marketing essay “Whence Consumer Loyalty?” published in The Journal of Marketing in 1999. In his own words, Dr. Oliver explains loyalty itself as “a deeply held commitment to rebuy or repatronize a preferred product/service consistently in the future, thereby causing repetitive same-brand or same brand-set purchasing, despite situational influences and marketing efforts having the potential to cause switching behavior.” Dr. Oliver goes on to explain four main types of consumer loyalty (cognitive loyalty, affective loyalty, conative loyalty, and action loyalty). In this article, we will be be talking exclusively about cognitive loyalty , touching upon the other categories in subsequent articles.
Cognitive loyalty is loyalty built by consumers’ own cognition; this means that consumers reason themselves that a certain product or brand is superior or premium. This type of loyalty extends to just about any kind of product you can think of. Here’s an example: Consumers tend to think that American Express credit cards and financing products are more elegant, premium, and all-around superior compared to other companies’ cards; another example is computers manufactured by Apple versus one of several other PC manufacturers. In both cases, companies in a space of exceedingly similar products (consumer credit cards and personal computers) through a magic slurry of masterful branding, digestible marketing, and several other tricks have grown a dedicated group of consumers who are exceedingly loyal to their products.
Consumers who exhibit cognitive loyalty have, in essence, convinced themselves that the product they align with is superior. Of course, a bit of helpful nudging from the source company’s marketing and customer service team can go a long way.
Tips to Achieving Cognitive Loyalty
Don’t Say it!
Cognitive loyalty is incredibly delicate and must be cultivated like orchids: with light, subtle nudges. If a consumer thinks you want them to think your product is superior, it’s more than likely they will take it the wrong way. Heavy-handed marketing doesn’t fly in the 21st century, so instead of buying a billboard that says, “We’re the Best,” consider, instead, ways to make your customers come to that conclusion on their own.
The IKEA Effect
There is a lot to learn from furniture giant IKEA, chiefly among those lessons is the marketing phenomenon that shares its name. The IKEA effect explains less so consumers’ loyalty to IKEA stores and more so their belief in the products themselves. Despite the reality that IKEA products are manufactured in similar environments and with similar materials to many of their competitors, consumers are consistently more connected with their IKEA furniture and products compared to others. Why? Because those consumers built the furniture themselves. Specifically, Harvard Business School found that 63% of consumers were willing to pay more money for furniture they had assembled themselves compared to similar (but pre-assembled) items.
This doesn’t mean that you have to run a furniture company to take advantage of the IKEA effect. The basis of the effect is the cognitive bias that a product or brand that the consumer helped build will likely become more favorable in their minds. A great means to get consumers involved with your business is to collect customer feedback and involve customers in your product creation process. The most essential piece, however, of collecting customer feedback is making certain customers know that feedback was both read and considered by your business.
The Better of Two Options (For Whatever Reason)
Think back to the two opening examples from this article: consumers often think Apple is superior to its competitors and the same is true for American Express compared to its competitors. This mindset doesn’t simply indicate that consumers prefer Apple or AmEx, but instead that they prefer them over something else. Cognitive loyalty requires that consumers pick your product and brand over something else which they will inherently see as less premium.
The first step to becoming the better of two options is finding (and getting to know) your competitors and their products/services. In many industries, this is straightforward but may well require some abstract thinking for some others. Once you find a point of comparison, consider the ways your business is more attractive; this doesn’t strictly concern prices and rates! Modern consumers are interested in more than price when becoming loyal to a brand. Consider marketing your business as the more ethical of two options: investigate means to decrease your carbon footprint or highlights the ways in which your business is already doing its part e.g., recycling, higher wages, donations to charity. Of course, businesses risk sending the wrong message when marketing their ethical traits themselves. Reach out to your local newspaper or television news station to see if they are interested in writing about your company’s strivings to become more ethical; the goal is to have consumers understand that you are being ethical and environmentally conscious for the sake of it rather than for increased brand loyalty.
Cognitive Loyalty Through Introspection
Developing cognitive loyalty for your business and brand will never be a one-size-fits-all solution. Consumers shop at businesses for near-infinite reasons. Take off your business owner hat for a moment and think about your own cognitive loyalties. What companies, brands, or products do you believe are inherently superior to their competition? What brought you to that conclusion? What can you do to emulate that sensation? Sit down with your trusted staff and ask these introspective questions and you’ll likely be one step closer to finding how cognitive loyalty best aligns with your business.