Is there such a thing as a “loyalty crisis”?

F’rinstance, can you lose your loyal customers and not other types of customers? 

A few years ago, Pointer Media (they do the coupon printers at the grocery checkout) — looked at the purchases of 32MM people across 658 leading brands.

(Dumb aside: Catalina, who owned Pointer Media, was partly owned by Berkshire. Then it merged with Nielsen in 2010 to create NCSolutions. Then Catalina went bankrupt. Meanwhile, IRI and The NPD Group merged & became Circana. Then this year, Catalina sold NCSolutions to Circana. Maybe. I think. #CouponLife.)

Anyway, then-Pointer saw that many brands, including these category leaders (unnamed to protect the innocent) were losing their “high loyals” — people who spent 70% of their category dollars on a single brand.

In this chart, only 3 of 12 leading brands increased their number of “high loyals”; the other 9 lost from 2% to 9%! *Gasp*!

Oddly, they even showed how many TOTAL buyers these leaders gained or lost. It turns out that there’s a 95% correlation between losing high loyals & losing all buyers. (The chart says 0.91 because that’s r2 of the regression, not r of the correlation. #StatsLife) 

But this fact was lost on them, because they didn’t know brand science. If they had, they would’ve realized that when brands grow or decline, they tend to lose ALL kinds of buyers. Because, as Wiemer Snijders says, “It’s the banana curve, silly.”

Caveats galore. But some lessons:

1. Learn the brand science! It makes results like these a whole lot less shocking.

2. Know that when you lose heavy buyers, you probably lose all other kinds of buyers too.

3. Stop calling them loyals! In this case, someone who bought 3 frozen pizzas from one brand out of 4 that year total was categorized the same as someone who bought 14 from one brand out of 20 total. Srsly?