brand loyalty turns negative. why?

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infoscott
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Re: brand loyalty turns negative. why?

Post by infoscott »

I think that drag weight towards zero you are feeling is what I would call the "irritation index". Working in retail a number of years, I see many things that irritate the customer, but the customer keeps coming back because we have what they need marginally better than anywhere else. Where I work now is the all too common case in Capitalism where the awareness is high, but the loyalty is close to zero or even negative. If the customers perceived they had a better choice to shop anywhere else, they would.

In Capitalism, there are a lot of things we do (or more often don't do) to augment the irritation index. Some of our products are not the highest quality compared to locals and competitors in the market. We raise prices too quickly. We let the value delta get too large and so shortages develop in the showroom (customers have to wait for product to arrive). We carry too many product classes.

So the results are in from my run at Legacy Brand Scenario. I finished the sub-goals of 10 products and 20 products, which as you might expect trashed my loyalty. I had furniture expertise, and then branched out into apparel, leather goods, and footwear (plus 5 semi products), so I was only split across 2 mega classes. However for the longest time I had imported relabeled backpacks and televisions into one city, so that put this city at 4 mega classes and by far the worst loyalty.

I found that in a scenario like this where you are forced into diversification, it's best just to designate one non-important city as the brand dumping grounds and put all your extra product classes into that city alone. I had started in the city with the lowest wage index, so did a lot of my manufacturing there as well as retail in all the diverse product groups. My other 4 cities stayed strictly in furniture products, and so their loyalty stayed mostly high (finished about as high as when the game started, but each city drifted in different directions). The dumping city had 0 to negative brand loyalty. I was also very careful not to let the AI sell my retail products and trash my loyalty accidentally.

Because the furniture brand has such high margins, often I was able to cross ship finished product to other cities and still make good profit. So this allowed a strategy of many global and regional warehouses to stock plenty of product and keep the stores' showrooms full. Keeping my value index close to the locals kept my margin very high and growth manageable. I kept a tech lead on core furniture products and thus enjoyed a monopoly in the class for nearly every city/product combination.
counting
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Re: brand loyalty turns negative. why?

Post by counting »

I was wondering though, is there any difference using advertising with showroom warehouses, and using it in constant running output units in retail or factories. I suspect it doesn't matter much if it's corporate brand, but for ranged brand, I am really not sure. Haven't played a lot of games using warehouse showroom techniques yet. I have a suspicion that if you have different quality products within the same goods, (it would usually happened with showroom warehouse, since goods never leave, but tech changes), and advertisement linking to a inferior quality copy, it might have different result when linking to a higher quality copy. Not sure if this theory is right or not.
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infoscott
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Re: brand loyalty turns negative. why?

Post by infoscott »

counting wrote:I was wondering though, is there any difference using advertising with showroom warehouses, and using it in constant running output units in retail or factories. I suspect it doesn't matter much if it's corporate brand, but for ranged brand, I am really not sure. Haven't played a lot of games using warehouse showroom techniques yet. I have a suspicion that if you have different quality products within the same goods, (it would usually happened with showroom warehouse, since goods never leave, but tech changes), and advertisement linking to a inferior quality copy, it might have different result when linking to a higher quality copy. Not sure if this theory is right or not.
I doubt advertising attaches to the product instance. It should attach to the entire product run in the case of unique brand, product class for range, and the company for corporate. But remember that's per city instance! So it is important where the warehouse is located. If you have central distribution and advertise from one distribution center, but then send those products to other cities, I believe it will lose the benefits of that advertising when it leaves the city. But it should pick up any advertising benefit for Advertising units in the gaining city. I see that all the time when the AI accidentally advertised seaport product (probably as a result of a Corporate brand strategy). If you advertise from a regional warehouse in the same city as the retail firm, then the advertising will surely stick.

Advertising inferior products just sets the sims up for disappointment and the player for a negative loyalty, although the effect is seen more with corporate and less with unique brand. I noticed this game relies heavily on weighted averages. I suspect the AI engine relies on a moving average of experiences to let the rating and loyalty drift up and down. I definitely saw moving averages come into play with the stock market when a company would have their share price trashed after a merger, even when it had been six to nine months after the hit to the balance sheet. So I'm guessing the same happens with loyalty, really bad or really good events will become part of the moving average for loyalty for that product in that town. If I am right, then a string of bad experiences over a long period of time could keep the loyalty pressed down in the negatives, as we have seen with corporate brand.

The way the Capitalism manual reads, the Advertising unit (regardless of which firm it is in) is a contract manager who negotiates with the media firm for such and such exposure at so much CPM for so many dollars. The sims hear about your product...somewhere...some number of the exposed use the traffic pattern to find your store, then try your product. I suppose they must all be filling out customer surveys after every purchase to indicate loyalty. :lol:
counting
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Re: brand loyalty turns negative. why?

Post by counting »

infoscott wrote: The way the Capitalism manual reads, the Advertising unit (regardless of which firm it is in) is a contract manager who negotiates with the media firm for such and such exposure at so much CPM for so many dollars. The sims hear about your product...somewhere...some number of the exposed use the traffic pattern to find your store, then try your product. I suppose they must all be filling out customer surveys after every purchase to indicate loyalty. :lol:
Well, conceptually that may be true, but I seriously doubt the programming code does any of it. I believe the brand awareness from 0 to 100 is just a plain value representing how many percent of the population in the city "know about" the product, and the brand loyalty represent how do they think about your band. Everyone can vote yes (+1), no comment (0), and nah it's bad (-1). Aggregate everyone's opinion and normalized it to 100% scale according to the total population, you get the loyalty number.

So a brand with 50 brand awareness means if there are 1 million people, 500k heard about the product. And since only people heard about it can have opinions, the highest number of votes can not exceed 500k, i.e. the absolute value of loyalty percentage can not exceed brand awareness percentage (in this case always smaller than 50 and greater than -50). Thus your overall brand rating never drops below 0, with highest rating caps at 200 (100+100, however its effective value caps at 100).

But from programming point of view, it's impractically to simulation 1 million agents, and do 500k vote counting every 1/10 second. Hence it's reasonable to assume, brand awareness is calculated by adding an increment value defined by a function of CPM times ads expenses then divided by total population, and its maximum value is capped by a function of media rating%. Very likely different type of media has different weight as to how many actual percentage of the audience are affective customers (I believe it can even spread, analog to an audience heard an ads from radio then tell its friend, thus the multiplied weight could be greater than 1).

As to brand loyalty, I've stated in previous post about my theory, and I might add that the "weight down toward 0" factor actually acts more like "customer forgetting factor". Imagine If the current brand awareness reach to a percentage of population surpass the actual customers market share, then some of the citizens who heard about it, not actually using it right now, so when asking its opinion, it will always state neutral. And if the product market share drops, then some of the original product customers now can not get to the product anymore, hence their opinions are reset to 0 (forget how good/bad it was), and reflect in loyalty value as a negative weight down toward 0 number (In reverse, if a user have negative options/loyalty before, finally leave the product 'evil clutch', its opinion will be reset, thus a positive value of "weight up" factor toward 0). In programming code, I believe it's just a simple product-market-share changed value factorized with other indexes.

However, all of the above still doesn't tell us exactly how the actual delta value is calculated, i.e. how people's opinions are pushed toward positive or negative when they get into product customers group within brand awareness group. From my past experience and David's replied, I believe it's a function of product quality weight average (if brand is not unique) and the price/rating compared to local/city average (not sure which factors are crucial variables, since if one is affected, the other one will be changed as well).
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andrewpang1900
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Re: brand loyalty turns negative. why?

Post by andrewpang1900 »

Hi, may I ask is there any tips or strategy that can help me pass legacy brand. I find getting over 50% really hard. I was using the "apartment strategy" which I bought all my own stocks in the start, and then build a few department stores and sell products from the sea sport. After making a little bit of profit I start building apartments, but I tended to run out of cash really quickly, and my percent level just stays at 41%. It would be really helpful and appreciated if I could get some tips or strategy on how to pass legacy brand. Thanks! : )
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