1.2

Double Jeopardy

The empirical regularity that brands with smaller market share have both fewer buyers and slightly lower loyalty among the buyers they have.

Coined by William McPhee (1963); generalised to brands by Andrew Ehrenberg (1969)

What it does

Small brands are punished twice: fewer buyers, and those buyers are also less loyal. The practical consequence is blunt: most loyalty spending is treating a penetration problem with the wrong instrument.

When it breaks

Weakens where switching is contractually locked (telco, insurance) and in heavy B2B where the buyer universe is structurally small.

Case

Habel and Lockshin replicated Double Jeopardy across 37 cross-sectional categories plus a 40-quarter panel of physicians' prescribing. It held, but as an upward-sloping curve rather than a straight line, with NBD-Dirichlet fitting better than linear or exponential models.

Habel & Lockshin · extensive replication ↗
Penetration Loyalty The law Worth investigating Small brands
Double Jeopardy · 1.2

In the wild

Unchecked · not part of the tier

What people have written about this tool in the last twelve months. A machine found these and nobody has read them. Everything above this line was checked by hand.

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