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Promotions that don't foster brand loyalty are on the rise, exposing more marketers to losing their biggest source of long-term profits: loyal customers.

Despite the intense competition to win and keep customers, many marketers are still undermining long-term goals with short-term promotional tactics, said Larry Light, a marketing consultant and keynote speaker at the first Power Seminar on brand loyalty. The seminar was held earlier this month in Chicago, co-sponsored by Catalina Marketing and Advertising Age.

"Does your promotion tout the Super Bowl or your brand?" Mr. Light asked, pointing to a plethora of meaningless promotions competing for consumers' attention.


Marketers also forget to reward loyal customers, who constitute the biggest share of profits in any category; many marketers instead give incentives and preferential treatment only to occasional, non-loyal customers, Mr. Light said.

"Do not confuse repeat behavior with brand loyalty," Mr. Light admonished. "You don't own the customer. Airlines, computer marketers and cable TV companies may think we're loyal because we're customers, but that attitude is wrong."

Marketers are saving millions by paring brands and reducing the total number of products in supermarkets.

But marketers can also realize big profits from loyal users by adding relevant new products under a powerful brand's umbrella.

"Line extensions strengthen a strong brand by demonstrating its greater capabilities," Mr. Light said. "But too often when coping with crowded shelves these days, marketers forget their mission is to build brand loyalty, not simply distribute products."

The heaviest pressure for brand marketers continues to come from supermarkets' private-label brands and price pressure from retailers.

But integrating promotional, advertising and other marketing initiatives to support a brand's core positioning is still more powerful than any other factor in marketing, Mr. Light contended.

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