The Brand Loyalty Delusion
What happens when language becomes cheaper than accountability?
Just for Fun
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The Brand Loyalty Delusion
We used to buy from brands because we liked them. Like, actually LIKE liked them. We’d argue about Apple vs. Android online like it mattered. We wore logos because we wanted to align our own identity with the brand. Outside of super niche cult-like brand communities, that’s mostly over.
Brand loyalty is at a five-year low. And the stat that should really bother people: most consumers would switch brands tomorrow for a discount code or a better rewards program. A literal coupon.
Brands still talk about loyalty like it’s a relationship but consumers have moved on, and are treating it like a transaction. What happened is pretty simple. Every company got access to the same loyalty infrastructure (points, tiers, cashback, personalized offers) and downgraded the experience and products customers received. As quality goes down, so does perceived value and then everything boils down to who has the best price.
I’ve been calling this the loyalty delusion: this idea that you can engineer devotion.
You can’t. You can engineer retention for a quarter, maybe two. But the moment a competitor offers better math, people leave. And they don’t feel bad about it because there was nothing to feel bad about leaving. The program was the relationship. When the program stops winning, the relationship is over.
This isn’t a dip; the tools that commoditized loyalty programs are getting cheaper every year. Today, every DTC brand, legacy retailer, and startup can run the same rewards infrastructure. Which means the infrastructure is absolutely worthless as a differentiator.
So who’s actually holding?
Behind the paywall this week: I’m tearing apart how Starbucks turned a premium brand into a coupon delivery system (their own CEO admitted it), why Costco has a 93% renewal rate with no loyalty program at all, and the one question that tells you whether your brand is building real loyalty or just buying time.
