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In: Business and Management

Submitted By lionkingismyfilm
Words 4393
Pages 18
MBA Consulting Project
Customer Loyalty as a Function of Brand Penetration Growth
Arguably, generating customer loyalty is a prerequisite for effective ad campaigns.
Frederick Reichheld claimed in the 1980s that by increasing customer retention by 5%, profitability would increase from 25% to 85%. Since then, profitability has actually increased 25% to 100%. Subaru used a multi-platform marketing campaign which included online and offline elements as well as a customer relationship management scheme, with personalized direct communications
According to Andrew Ehrenberg's "double jeopardy rule", small brands are said to be "doubly jeopardized" because they have fewer buyers who are less loyal to the brand, while large brands tend to "benefit twice" as a result of higher market penetration, increased buying frequency and customer loyalty. Brands looking to increase customer loyalty should focus on increasing penetration, since loyalty follows as a logical consequence of brand penetration
." Consumer loyalty can also be increased by creative marketing campaigns that generate buzz and stimulate word-of-mouth. As opposed to simply looking at attitudinal loyalty, it is important to observe price sensitivity as a measure of consumer commitment to a brand.
Multi-media campaigns are an effective way to stimulate market share, thereby increasing brand loyalty. An important part of any marketing mix is the use of television advertising, which repeatedly demonstrates it's superiority as a delivery mechanism, with the highest daily and weekly reach in Canada. Television effectively communicates creative expression as well as key ideas through stimulating the senses, making it the most powerful medium available to advertisers.
NT and Bovril
Bovril is a brand with universal saliency which enjoys a special relationship with British consumers. However, it is also...

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