Double Jeopardy in Marketing! The relationship between Penetration & Retention

Double Jeopardy, many of us would have heard this term coined in legal dramas such as "Suits." Legally speaking, "Double jeopardy" means one cannot be prosecuted twice for the same crime. So you may ask, "Hey Ruben! What's double Jeopardy got to with marketing?" Well, everything and nothing.

Let's look at what it means, "Double Jeopardy" was first coined by social scientist "William Mcphee" in 1963. His observation was that brand loyalty and brand penetration were interlinked with each other. In simple terms, he noted that the brands with a lower market share have fewer buyers and Lower brand loyalty. Subsequently, double jeopardy has been seen to apply across diverse categories, from detergents to aviation fuels and across countries and time.

So what does it mean for all the effort that goes into loyalty and retention of customers? Are retention programs inherently flawed, as it is more likely that a customer of a brand that has a lower market share will naturally be a brand switcher?

Not all is lost for retention marketers ; there is a simple method to differentiate yourself from the group. And that is the tool for positive brand building. Branding has been used extensively in today's digital world to cater to extremely niche segments. And brand building and retention go hand in hand in today's world.

Build Your Customer Profile/ Persona Accurately

Just look at "Dove". Although it is a mass-market product, "soap" the brand persona, has been created such that it has inadvertently become a niche-market product.

The Product managers were able to drill down their user personas perfectly, with the idea of making it the favored product in a specific segment of the market.

"Le-Sancy" hope I am correctly spelling the name is another such example. Although the brand exists no more, many of us still remember "Rohan Pani Chala Jayega!" the witty tagline used by the company.

These 2 were never market leaders but were able to build a niche following with the segment itself by identifying their customers more accurately.

Today AI & Listening tools make it much easier for Marketers to create customer personas and keep building on them accurately.

Build Your Brand around a Cause that a Group of People Care for!

This is a great way of differentiating yourself from a plethora of services and Products available. If you stand for a cause, people who would also like to be associated with it will become part of your journey. Here I will give two examples from my personal experience where it was a win-win for everyone.

Building a Compassionate Brand at SAAARTHI

The first example is "SAAARTHI" a consumer service startup. The idea behind it was to provide stable jobs to people who were working as independent contractors, such as drivers, home tutors, etc. There were three things we predominantly told people who were looking to hire via us.

1. Mediclaim to the people who were hired via us.
2. Proper verification.
3. Uniforms, Training support.

We noticed the first point of providing Mediclaim to these contract workers resonated well with both the employees and the employer as they felt compassion for them but would not have been able to do the same if they did it independently as it would have been expensive. Note that this was before the present government had launched the Mediclaim policies.

This resonance of compassion was what allowed us to stand out in a market that was already crowded, as well as justify the fee we were charging for the services.

Building a Relatable brand at Kalingafresh

When we started out with the idea of building Kalingafresh as a D2C brand, the Idea was to help the farmers we were providing consulting services to sell their products. Over time we moved into a space where we identified a segment that was underserved and which was willing to pay for Quality, "The Working Women".

We shifted our branding and communication after a few months of launch to cater to this audience. Talking in their language, specifying why we were a better choice. We also identified a concern: whether the Food they were eating was Organic, instead of saying that the products were Organic, which requires certification. Most of our farmers were growing their crops organically, so we said "Organically Grown". We also ensured that some of the local products exclusive to the region were included in our digital catalog.

These 2 factors Helped us to resonate with our customer base, there were other factors, such as excellent customer support, but the resulting effect was a retained customer base.

Discounting & Freebies

This is a more common retention technique companies use nowadays for customer retention. If we have registered our mobile or email on some service or the other, we nowadays get inundated with discount offers, especially during festival season.

Marketers account for this as Retention costs. But is it a great method to retain customers? In the short term, Yes is quite useful in habit building for using the product or service that needs to be built. But a Long term retention strategy based on discounting can lead to a depletion of finances; look at the case of Zomato, Blinkit, and other startups. They are slowly shifting away from the discount-driven retention strategy that has led to their growth.

Now because there are only 2 major players in the case of food Delivery, i.e., Zomato & Swiggy, they can do it. What if suddenly, a third player can deliver the same experience as these 2? What happens then?

Making it Difficult to Switch

A standard technique for retention used by B2B saas platforms is the difficulty of switching. If you have used CRM software or any marketing automation tool. The learning curve for such tools is steep and expensive. It's expensive because while you are switching, there is a potential risk of losing customers due to the platform needing to be more mature; it also involves software engineers and data engineers to enable the platform.

A few new players in this domain are breaking this typical entry barrier by simplifying the process using no-code methodologies.

Delivering Delight

Only a few companies work on this strategy. This is similar to a magician pulling out a rabbit from the hat and wowing the viewer; here, the marketer needs to keep pulling out tricks at opportune moments to deliver the same feeling as a magician does.

This is a strategy that can work extremely well if done right.

Delight can be as simple as giving an extra Toffee as your local shopkeeper does for you or as extravagant as allowing winning a lottery. If we look at the FMCG sector, they are masters in this. From using Scratch cards to giving tazos in the old days, this sector has always been innovative when it comes to building loyalty and retention.

Would love to hear your feedbacks on the same!

Marketing, Branding Business