The Ehrenberg-Bass Institute for Marketing Science, based at the University of South Australia, has spent well over sixty years studying how brands actually grow, and its central, repeated finding cuts against a lot of default marketing instinct. Growth mostly doesn’t come from deepening loyalty among existing customers. It comes from reaching light buyers, the large group of people who purchase a brand only occasionally, who make up somewhere between 70 and 80 percent of any brand’s customer base.
This is the practical implication of what the Institute calls the Double Jeopardy Law: smaller brands don’t just have fewer customers, those customers also buy slightly less often, on average, than a bigger brand’s customers do. Both penalties compound. The fix is broader reach aimed at people who barely think about the brand at all, ahead of a better loyalty programme for the people already buying, because that’s the pool most of tomorrow’s buyers are sitting in today.
The Institute’s research on advertising hiatuses makes the same point from a different angle. A twenty year study tracking media spend and sales across dozens of Australian consumer brands found that on average, sales fell 16 percent after a full year without advertising, and 25 percent after two years, with small, growing brands hit hardest. Big, established brands weathered a pause far better than small ones did, which tracks with the broader finding: mental availability, being the brand a stranger thinks of first when the need arises, decays quickly once a brand stops reminding strangers it exists.
None of this argues against retention work entirely, keeping existing customers happy is still worth doing on its own terms. What the research actually argues against is the specific, common instinct to treat marketing spend as primarily a loyalty and personalisation exercise, hyper-targeting the people who already buy, at the expense of the much larger, much less exciting task of staying visible to people who don’t yet.
That’s not a comfortable message for a client used to thinking about their “ideal customer” as a tightly defined segment worth chasing harder. The research says the ideal customer, in aggregate, looks a lot more like everyone in the category, reached broadly and reminded consistently, than like a narrow persona reached deeply. It’s less satisfying to plan around than a detailed customer avatar, and it’s better supported by sixty years of data than the avatar is. The loyal customer isn’t where growth comes from. They’re what growth looks like after it’s already happened.
The loyal customer isn't where growth comes from. They're what growth looks like after it's already happened.