Algorithmic personalization and brand loyalty: An experiential perspective.

Abstract

This article explores the relationship between algorithmic personalization and brand loyalty by examining how personalization experiences are articulated within the context of music streaming consumption. Despite previous acknowledgement of the link between personalization and brand loyalty, an experientially grounded understanding of how this works has yet to be articulated. Building upon the concept of ‘experiential brand loyalty’, the Algorithmic Personalization/Depersonalization Loop highlights the development of brand loyalty through consumers’ interactions with algorithm-backed brands. Being seen and understood by the algorithm sets off an iterative, two-way learning relationship that ultimately heightens the consumers’ experience, activates positive emotions, and deepens the relational bond with the brand, leading to brand loyalty. If, however, the algorithm is unsuccessful in personalizing the service experience, a ‘depersonalization’ process can occur that erodes brand loyalty and can lead to brand switching or even consumer activism.