• by Sarah Mahoney  @mahoney_sarah, September 30, 2010

A new ranking of the brands that inspire the highest level of customer loyalty puts Apple's iPhone -- even with its well-publicized tech glitches -- in the No. 1 spot, followed by Samsung's handsets and Walmart. And by category, cosmetics and retailers inspired the most loyalty, according to the 10th annual Top 50 Brand Keys Loyalty Leaders, an annual survey by Brand Keys.

"Brand loyalty is driven by emotion, but a little less so as the economy gets better," Robert Passikoff, Brand Keys founder and president, tells Marketing Daily. "People are wanting to engage with brands, but in a meaningful way -- sometimes marketers mistake entertainment for engagement, but it's not the same."

After Apple's iPhone and Samsung, which were also both No. 1 and 2 in last year's survey, and Walmart, the Top 10 list includes Grey Goose vodka, Apple Computers, Hyundai, Amazon, J. Crew, BlackBerry and Avis.

Cosmetics and moisturizers, led by Mary Kay, Maybelline, Estee Lauder and Clinique, account for 30% of the leading brands. Technology was also stronger, making up 26% of the Top 50 brands, he says. Retailers also gained, accounting for 16% of the Top 50, with Kohl's, Target, Sam's Club and B.J.'s doing well.

The biggest gainers in the year's loyalty derby, he says, are Progressive Insurance, Avon and Domino's Pizza, precisely because they have found especially effective ways to connect with consumers. "Some insurance brands rely on a very high level of emotion, but there's only so many times a consumer can take in that 'We care, and we're there for you' message.

"With Flo, Progressive has invented this very entertaining and engaging character who focuses on the process of getting insurance, which is what consumers have questions about. She's got this non-threatening, easy-peasy kind of humor, surrounded by a set so white it looks like heaven. She telegraphs an absolutely painless transaction, which is what people want from an insurance company."

Domino's, Passikoff says, is gaining big points for its honesty, with commercials that address its problems with taste and delivery. "It wasn't that it tasted so bad people spit it out, but they faced the fact that the taste of the product was not optimal, and they dealt with it honestly and openly," he says. "People like that."

The Brand Keys ranking is based on interviews with 85,000 consumers.