Brand Loyalty

Brand loyalty is a consumer behavior pattern where

consumers become committed to a particular brand and make
repeat purchases over time. Companies use creative marketing
strategies, such as loyalty or rewards programs, trials, brand
ambassadors, and incentives like free samples to build brand
loyalty.

Strategic Advantages of Brand Loyalty for a Brand

or a Company:
 It decreases Marketing Expenditure of the company
 Acts as entry barrier for competitors.
 Generate positive world of mouth by its consumer
 Provides leverage while dealing with Retailers.
 Enhances the ability to add line and brand extensions.

The Disadvantages of Brand Loyalty

 Overpaying
 Discontinuation
 Related Articles
 Missing Out on Features
BRAND LOYALTY OF NIVEA PRODUCTS
Searching for a brand phenomenon, I came across an interesting brand
from my home country Germany. NIVEA, which belongs to the
German Beiersdorf concern, is the leading global brand for skin care. According to
Forbes, NIVEA’s brand value in 2017 is $ 6.9 Billion and therefore NIVEA is #98 of
the “World’s Most Valuable Brands”. Its products are sold in over 200 countries,
holding market leadership in 46 countries. It is not only economically successful
and well known, but also one of the most trusted brands in the world. For
instance, Nivea was voted Germany’s most trusted brand in a Reader’s Digest
survey in 2016, 2014, 2013 (2nd place in 2017 and 2015). Speaking personally, I
think NIVEA is always a good choice. I trust the brand and my inhibition threshold
to try new NIVEA products is very low.

Müller and Wünschmann (2004) identified brand sympathy, brand uniqueness and
customer satisfaction as the main sources of brand trust. Furthermore, they
illustrate that brand trust leads to customer loyalty. Having a big loyal customer base
is very important for the success and survival of a brand.
The picture above shows only the one part of the framework by Esch,
Langner and Brunner (2005) that is relevant to my question. It reveals
that on the one hand, brand awareness, brand image and brand
satisfaction have an impact on brand trust. On the other hand, brand
trust influences brand image, brand sympathy, brand commitment and
brand loyalty.

Awareness
The majority of people know NIVEA for several reasons. First, NIVEA is
existing for 106 years and most people have grown up with the brand.
The second reason is its brand architecture. Due to its umbrella brand
strategy, Nivea occupies a large place on the shelf, since it offers
products under the umbrella brand in all skin care segments (for
instance face creams, deodorants, shaving, sun lotions and shower
products). As a consumer, you cannot escape the strong presence of
the brand at the POS. The high distribution and availability of its
products are important factors. Third, NIVEA invests a lot in brand
communication (for example TV spots, print advertising and sales
promotions). They follow an integrated communication approach
communicating consistently for all products over all channels using the
same brand elements.
Sympathy
NIVEA is perceived as a sympathetic brand. In my opinion, the main
reasons for this are its strong heritage, its price-performance ratio and
its brand communication. NIVEA was founded more than 100 years ago,
surviving all obstacles like both World Wars. Moreover, it’s a German
brand and those are usually perceived as high quality and reliable which
makes the brand sympathetic. NIVEA is offering its products at a
reasonable price with a good price-performance ratio which makes it to
a brand for the masses. Consumers can afford the products and brand
communication is helping additionally to build up sympathy and
customers’ identification with the brand. NIVEA’s visual communication
is based on bright colors, cheerful family situations as well as authentic
and charismatic brand ambassadors (for instance Jogi Löw, coach of the
German national football team).
Image
NIVEA has a strong image. The brand stands for closeness, trust,
authenticity, naturalness and quality. The focus is also on family values,
as protection and security for the whole family, and the strong heritage
of the brand. The NIVEA creme has been the world’s first stable oil in
water emulsion moisturizing cream in 1911 and therefore, NIVEA is
holding the image of the first mover which implicates expertise.
Another part of its image is that NIVEA offers good value for money. All
brand values and associations with the brand are embodied in the blue
tin of the NIVEA cream since 1925 which makes it the most important
brand element.
Uniqueness
NIVEA is a unique brand. One of the reasons for it is its strong heritage
and long history. There are not many brands that consumers already
know from their (great-)grandparents and parents. This is a very
important aspect that leads to brand trust. Moreover, the flagship of
the brand, the NIVEA cream, has a unique smell and a characteristic
packaging – the blue tin. Everybody knows the blue tin and NIVEA
managed it very well to make only slight changes over the years to
modernize the packaging design without losing its uniqueness and
recognizability. In 2013, the company decided to change the logo based
on the look of the blue tin to have an even more integrated
communication. The logo, the typology and the colors white and blue,
which Nivea consistently uses in brand communication, also contribute
to the uniqueness of the brand.
Satisfaction
The satisfaction of the consumers after buying a NIVEA product is
guaranteed by its good product quality and the reasonable prices.
Moreover, consumers receive a satisfactory purchasing experience due
to the high availability of the products. It is very unlikely to not find a
NIVEA product in a supermarket. The products satisfy the customers’
expectations because they almost stay the same over the years and
new products are launched under the umbrella brand with the same
quality and price level as well as brand communication elements.