Small brands suffer twice: they have fewer buyers, and those buyers are also less loyal.
Small brands' apparent loyalty problem is a mathematical consequence of their size, not a failure of their marketing. It is the most consistently replicated finding in marketing science.
In practice
- A challenger brand's low repeat-purchase rate is read as a loyalty failure, and is what a brand of that size mathematically must show.
- A small charity's donor retention looks poor against a national one, and would look identical however well it was run.
- Standing
- Loyalty is largely a consequence of market share, not a route to it.
- Subject
- Economics & Incentives
- Essay
- The regularities money obeys