Consumers See Ads through Rose-Colored Glasses

This week the University of Chicago released a fascinating press release on the relationship between brand loyalty and perceptions of advertising. The authors of the study looked at consumers who were very loyal to specific brand-name products, and found that their level of brand loyalty heavily influenced the way they processed advertising.

Let’s use two classic competitors as an example: Coke and Pepsi. When faced with a Pepsi ad, a loyal Coke buyer immediately searches for the dissimilarities in the ad. They focus on the differences that indicate that the competitor brand (Pepsi) is inferior to their chosen brand (Coke), thus perpetually justifying their purchase decisions. This makes it challenging for Pepsi to "steal" this customer from Coke.  A consumer who is less loyal to Coke, however, will see the same ad in a completely different way. They will search for the similarities between Pepsi and Coke, thus making the brands seem alike and making it easy to switch between them with minimal thought. The latter is obviously not an ideal situation for either Coke or Pepsi.

The good news is that the authors were eventually able to change the perceptions of both low and high-loyalty participants “by asking them to shift their focus from dissimilarities to similarities, or vice versa.”

The full study, which will be published in the February 2009 edition of the Journal of Consumer Research, may have some interesting implications for how we create online advertising. Traffic and conversions generated from non-branded content are typically regarded as having a high percentage of new customer acquisition. However, the content of the advertisement and the brand loyalty of the consumers undoubtedly has an effect on how likely the users are to buy. A marketer who can learn to leverage this notion and create advertising which focuses on the appropriate similarities or dissimilarities just might have the key to significantly expanding his customer base.

Comments

[DH]

Consumers who like brand Red may believe that this preference is based on certain features of Red. Brand Blue can then reduce the resistance of Red customers by touting these features (as long as its claims are believable), making Blue seem more similar to Red in areas that Red consumers value.

Suppose that brand Red adopts a different strategy. It attempts to differentiate itself from Blue based on features that dedicated Red customers value strongly (but Blue customers value less or even actively dislike). Red's ads reinforce Red's negative image with "moderate" Blue customers.