When does growth become the enemy of brand loyalty?

A recent post from Jamie got me thinking about one of the contradictions surrounding brand growth.

Jamie wrote about VÅGA and the loyalty it has created amongst the fell and trail running community. His description of the “almost imperceptible nod” between two people wearing the brand resonated because it represents something many businesses spend considerable amounts of money trying to manufacture but few achieve. 

Belonging.

There’s a huge difference between customers buying a product because they like it and customers feeling that their choice of product says something about who they are. At that point, loyalty moves beyond satisfaction and becomes cultural.

For brands that achieve this, a commercial dilemma may emerge when the opportunity for major growth comes along. Most businesses measure success through volume, revenue, market share and the number of customers, so if demand can grow beyond the original audience, commercial thinking says the response should be to pursue it.

But at what point does reach begin to compete with relevance?

Part of the attraction of a community-led brand is the sense of recognition between the people who understand it. Jamie described it as the "IYKYK" quality, and I think that captures it perfectly. It’s when the product becomes a signal that identifies somebody as belonging to a particular community.

But what happens to that signal when everybody can access it? If a brand that was once discovered only in specialist environments suddenly becomes available everywhere, does its original community feel proud that others have discovered what they knew, or do they resent seeing it at every turn?

If the product moves from the independent retailer into increasingly mainstream channels, does greater visibility strengthen the brand or does it remove some of the cultural currency that made it desirable?

There are many examples of brands that have successfully expanded beyond their original communities whilst retaining loyalty. But there are also others that achieved significant growth and, along the way, became less meaningful to the people who first championed them. Growth and brand equity are not the same thing.

Community loyalty creates something that conventional marketing struggles to replicate - advocacy without asking for it and a sense of ownership amongst customers who ‘discovered’ the brand rather than being sold it. There is commercial value in that loyalty, but the difficult question is how far should this be monetised?

Is the challenge therefore recognising that not every available sale has equal value? Yes, additional customers may increase revenue, but if reaching them changes the perception of the brand amongst existing advocates, the challenge becomes more complicated.

This may be where brand strategy and commercial strategy collide. One asks how much further the business can travel, whilst the other should perhaps ask how far it can travel without leaving the loyalty behind.

What is the business trying to achieve? Is it sales volume growth, distribution and awareness, or is some degree of exclusivity, cultural relevance and belonging worth protecting, even if that means resisting the easiest routes to growth?

After reading Jamie’s piece, I kept coming back to one question: at what point does growing your customer base begin to dilute the reason your most loyal customers chose you in the first place?

I'd be interested to know where people stand. If you’d built a brand with genuine community loyalty, would you protect some of that exclusivity, or take the opportunity to turn that loyalty into greater sales despite the risk of diluting what made the brand relevant in the first place?

Mark Wolstenholme