By Bill Nissim
Copyright © 2009
What is the value of brands? I get that question all the time. The best way to answer that question is to ask you, the reader, a couple of questions.
Imagine you are at your local grocery store. As you walk down the first aisle, you notice that every box, bag, and package on the shelf is white with black lettering. Although you recognize the type of food products, let's say breakfast cereal, there is no distinguishing colors, logos, or images on any of the containers. You are a fan of a particular brand of corn flakes, but every box looks the same to you.
Here comes the question: How do you decide which box to pick up? If there were five different boxes that all offered the same contents, on what basis do you select one? Let's go through the mental buying process as you stand in that cereal aisle:
- You locate the "Corn Flake" section in the box cereal row
- You quickly scan the variety of offerings (brands)
- Both your short and long term memory search for prior experiences
- You collate and prioritize various brands based on personal criteria (taste, flavor, calories, etc.)
- You search the shelves based on selection criteria
- If the primary offering is not available, you switch to a secondary product (third, fourth, etc.)
- Based on availability, you garner a sense of satisfaction (or dissatisfaction if not available).
If all the boxes were the same, steps two through seven would be irrelevant. When shoppers select "generic brands" at the grocery store, they are basically saying "for a cheap price, I am willing to go with a food product that is good enough." In a down economy where every dollar counts, corn flakes are corn flakes. In this case, brands are not important.
The problem is - we do have preferences and ideologies that drive our selection process. (please see "Brand Loyalty: The Psychology of Preference" article http://www.ibranz.com/article8.html or YouTube video at http://www.youtube.com/watch?v=Qh349YTyOow). Whether its taste, convenience, status, or trust, we made choices that go beyond the tangible and into an emotional realm. If we are status driven, we by-pass the generic brand and select one in which the label evokes feelings of a premium product. Although we subconsciously understand that both items were probably made at the same factory, it's the brand that provides assurance of quality and reliability.
In short, what is the value of brands? They provide a means to make buying decisions. If the brand promise is upheld, maintained, and promoted on a consistent basis, we as consumers have little incentive to switch brands over time.
