Editor's note: This week, Marketing Daily brings you exclusive coverage of the Brand Keys 2015 Customer Loyalty Engagement Index (CLEI). Each day, expect a report on key product/services categories from among the 64 surveyed for this year’s study, including automotive, electronics, retail, technology and alcoholic beverages (beer and vodka). This first installment provides a results overview, followed by highlights from “consumables” categories including restaurants (by format), soft drinks, packaged coffee and breakfast bars.
Once again, this year's Brand Keys CLEI underscores the mounting challenges faced by brands in attempting to meet rising consumer expectations, so as to achieve differentiation, engagement, loyalty, and ultimately, marketplace success.
And again, the annual study shows a continuing rise in consumers' "emotional" (as opposed to "rational") expectations.
Consumers' emotional expectation levels across the 540 brands (including 36 brands new to the survey), spanning 64 product/services categories, that were researched this year jumped by an average of nearly 24% compared to 2014's levels, bringing them to the highest levels recorded in CLEI's 19-year history.
But consumer perceptions of how well brands meet their expectations rose by just 7% on average during the year, adding to the growing gap between expectations and brands' success at delivering on these, points out Robert Passikoff, founder and president of Brand Keys, a New York-based brand engagement and customer loyalty research consultancy.
Today's information-empowered, socially networked consumers have come to expect brands to deliver on every possible factor — particularly when it comes to emotional gratification and engagement. "Brands are functioning in an environment marked by extraordinarily high levels of emotional expectations,” sums up Passikoff.
“In a marketplace where brands struggle to create meaningful differentiation and engagement, those that are better at identifying customers’ expectations and connecting with them via authentic emotional values are the ones winning customer loyalty and seeing tangible bottom-line results, meaning greater sales and profits,” he stresses. "The first big hurdles are accurately measuring this gap and determining what emotional values can help a brand successfully fill it.”
Reflecting consumer input, new product/services categories in this year's CLEI survey include breakfast bars and app-based ride-sharing services. These replaced two older categories in which the brands, based on the survey statistics, have become so undifferentiated as to be "interchangeable," reports Passikoff: breakfast cereals and diapers.
Here's how CLEI works: Each year, respondents self-select the product/services categories in which they are consumers, and the brands for which they are customers. Respondents determine which and how many brands make the rankings within a given category each year. Assessments are based on an independently validated technique that identifies the core rational and emotional factors that drive consumers’ “ideal” for each specific category. The rankings in each category reflect how well, on an indexed basis, each brand met or exceeded the “ideal” for its category.
For the 2015 CLEI, Brand Keys surveyed 36,605 U.S. consumers between the ages of 18 and 65, drawn from the nine U.S. Census regions. Most (70%) were surveyed by phone; 25% face-to-face (to identify/include cellphone-only households); and 5% online. The proprietary research technique/statistical analyses have a test/re-test reliability of 0.93, which provides assessments generalizable at a 95% confidence level.
(A free copy of this year's complete rankings can be obtained through the Brand Keys site.)
Bars: A New Category
As noted above, breakfast bars are now so frequently mentioned by consumers that they have become a CLEI category for the first time this year — bumping the breakfast cereals category, in another reflection of the heightened competition that has contributed to cereals' continuing sales declines.
The breakfast bar brands currently showing the highest loyalty and engagement levels are Kellogg’s Nutri-Grain, Atkins and Rice KrispiesTreats, in that order.
Other bar brands that made the rankings, in order, are: Nature's Valley, Quaker and Kashi.
Restaurants: Chipotle, Subway, Domino's Lead Their Formats
*Casual/fast-casual restaurants: This year, Chipotle Mexican Grill ranks #1 in customer loyalty and engagement, bumping last year's #1, Panera Bread, down to #2. Texas Roadhouse
(ranked #6 last year), is in the #3 slot.
Other brands that made this year's rankings, in order, are: Denny's (first time making the rankings); Au Bon Pain (#3 last year); Arby's; IHOP; Applebee's; Ruby Tuesday; Chili's; Outback Steakhouse; Olive Garden; Cosi; Red Lobster; Golden Corral; and TGI Friday's.
*Quick-service restaurants: Perennial CLEI
leader Subway is in the top spot once again. Chick-fil-A is again ranked #2. Wendy's rose to third place (from fourth place last year).
Other brands that made this year's rankings, in order, are: Burger King; Taco Bell and KFC (tied); Hardee's; Popeye's; and McDonald's (down considerably from 2014, when it tied with Chick-fil-A for #2).
Quiznos, which ranked eighth last year, didn't draw enough consumer mentions to make this year's rankings.
*Pizza restaurants: Domino's also held onto its top ranking, followed by #2 Pizza Hut and #3 Papa John's. (Last year, the order was reversed, with Papa John's at #2 and Pizza Hut at #3.)
Other brands that made this year's rankings, in order, are: Little Caesars, Papa Murphy's and Chuck E. Cheese. (Sbarro, ranked #6 last year, didn't make this year's rankings.)
Coffee: Two Big Brands Strong In Both Restaurant/OOH and Packaged
*Coffee, Out-of-Home: This category was previously called "coffee restaurants." This year, Dunkin' Donuts and Starbucks tied for #1 in customer loyalty among coffee enthusiasts
— whereas for the previous three years, Dunkin' was #1 and Starbucks was #2. Tim Horton's held onto its third-place ranking, and McDonald's ranks fourth again this year. The Coffee Bean, ranked
#5 last year, didn't make this year's list.
*Coffee, Packaged: Dunkin' is also again #1 in the packaged category. But in a notable shakeup, Folgers, which was down at #6 last year, grabbed the #2 position away from Starbucks, which ranks third this year.
Other brands that made 2015's rankings, in order: Allegro (also #4 last year); Maxwell House (#8 last year); Green Mountain (tied for #4 last year); Chock Full O' Nuts (tied for #3 last year); and Eight O'Clock (#5 last year).
Brands that didn't make this year's rankings include Caribou (#3 in 2014), and Peet's and Lavazza (tied for #7 in 2014).
Soft Drinks: Pepsi's Rankings Improve
*Regular soft drinks: Coca-Cola is #1 for the fourth year in a row, and Mountain Dew held onto its #2 ranking. This year, Pepsi — which had dropped to #5 in 2014 — jumped back up to take the #3 ranking.
Other brands that made this year's rankings, in order, are: Sprite (#3 last year), Dr Pepper (#4 last year), and 7-Up (#7 last year).
Fanta, ranked #6 last year, fell off the rankings this time.
*Diet soft drinks: Diet Coke takes the top ranking for the fourth consecutive year. Diet Pepsi, like its
regular-calorie sister brand, improved its ranking, jumping to #2, from #4 in 2014. It bumped Diet Mountain Dew down one place, to #3.
Other brands that made the rankings, in order, are: Diet Dr Pepper (#3 last year) and Diet 7-Up (also in fifth place last year).