business loyalty vs brand affinity
How to escape the rat race of price competition.
The vast majority of businesses fail within the first three years. Most other businesses never reach the levels of profitability they want. One of the main reasons for both, is that these businesses never manage to develop brand affinity. Most of them don’t even know what it is, and if they do, they’re too busy running their business to devote any time to it. After all brand affinity isn’t developed overnight.
So what is brand affinity?
Let’s start with what it isn’t. It isn’t business loyalty. When customers keep buying from you because your product or service gives good value for the price, you’re operating in the paradigm of business loyalty. Your customers are loyal to your product’s price-to-value ratio. This means that when a competing product with similar value and a lower price becomes available, your customers will stay loyal to the best price-to-value ratio, and move to that product. As long as you’re operating in this paradigm, you’re more of a business than a brand.
The perks of being a brand.
When you have brand affinity, you’re less confined to the price-to-value ratio.
Brand affinity is when you and your competitor have practically the same product with the same value, but customers are willing to pay more for yours. So what kind of person would buy from you when they can easily get the same thing for less elsewhere?
It’s the person who has an emotional relationship with you. The kind of relationship that extends beyond your product and its price. They damn well know they’re paying you more than they need to, and they’re happy to do it.
At this point, you’ve escaped the rat race of competing for consumers via pricing, because they now have an affinity for your brand, instead of just a loyalty to your business. So how do you reach this point?
The remaining posts in this series will cover 5 powerful attributes a business can acquire in order to become a brand and develop brand affinity with consumers:
- a backstory
- customer experience
- brand values
- a good cause
While they aren’t all necessary, the more of these elements you can infuse into your business, the more your business will become a brand that’s free from the price-driven rat race.