No. 188 · Strategy · Economics
Loyalists vs Mercenaries
Discounts buy attention quickly, but they rarely buy commitment.
In the Almanac
“Machiavelli’s warning”, 1513 · “Groupon”, 2010–2011
Both stories in full, three ways to use it and where it misleads.
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Questions
What is Loyalists vs Mercenaries?
Loyalists vs. Mercenaries sorts customers, supporters and team members by why they stick around. Loyalists stay because they value what you offer and recommend you to others. Mercenaries stay only while your price or perk beats the alternatives.
How do you use Loyalists vs Mercenaries?
Discounts can buy attention but rarely commitment. Invest in what builds real attachment, such as quality, recognition and care, and know which group you are serving before you spend money trying to keep them.
When does Loyalists vs Mercenaries matter?
Loyalists vs Mercenaries is one of the 56 mental models for strategy, the situations where you ask: How do I win when others want the same thing? Within that, it belongs to “Winning customers”, alongside Adverse Selection, Apostle Model and Churn.
What is an example of Loyalists vs Mercenaries?
Two stories show it at work: Machiavelli’s warning (1513) and Groupon (2010–2011). Both are told in full in The Mental Models Daily Almanac, which has two stories for each of its 365 models.
Which mental models are related to Loyalists vs Mercenaries?
Social Norms vs Market Norms, Trust and Incentives. Loyalists vs Mercenaries itself comes from economics.