Why Do Customers Value Brands?
Updated: Oct 23, 2020
In this second in the series ‘a good brand is good for business’ I’m going to look at why customers pick and value certain brands. Why do they pay more for brands that, in many cases may be just the same, or only marginally better their unbranded counterparts? Here are the top 4 reasons why.
1. Who do you trust?
Countless research studies confirm that customers trust branded products more than they trust unbranded products. It may be that a customer has always bought a particular brand, or their experience of using the brand has been good. Whatever the reason there is a familiarity with the brand that delivers trust. So, when considering their choice, the customer plumps for the one that they are familiar with.
2. It’s wired into our brains
Our brains manage to filter out most of the vast number of stimuli we receive every day, and of that stimuli we are increasingly bombarded with brands and advertising – various research studies put the number of ads we see on a daily basis from 4,000 through to 10,000. That’s mind-boggling and our brain does an excellent job in screening out the bulk of them. But it knows when a brand comes along we happen to like, and it will let that one through. So, on a supermarket shop, you may pause to look at the 20 different kinds of butter but you are only “seeing” your brand – into the trolley it goes and the autopilot directs you to the next favoured brand choice. Being one of the brands a customer carries around in their head is of course extremely valuable for brand owners.
Brands might also charge a premium not just for offering a better product, but a different product. That could be a feature that appeals to a particular customer – instant coffee with half the caffeine, for example. And then there are many products that are basically the same, so the role of the brand here is to discover and embody a distinctiveness that will mark them out and appeal to a particular customer. A great many sectors fall into this category – fashion and alcoholic drinks, for example.
4. Brands as a signal
Finally, it’s worth pointing out that to a greater or lesser degree we have some notion that the brands we consume say something about us and our capacity to choose. This informs the clothes we wear, the cars we drive, the drinks we order, even the street we want to live on, etc. Brands signal to the world an image we project – intentionally or not. And brand owners rely on this because they know that customers are willing to pay a premium for products that enhance or reinforce their self-image.
In the final instalment of our series, we are going to look at why companies value brands so highly. And if you can’t wait, you can read the blog here.
Bruce M McKinnon is a brand strategist and the author of the award-winning book ‘What’s Your Point?’. The book explores how brand strategy can fuel business growth, referencing some of the world’s most successful brands as well as sharing case studies from his own global consulting practice. The book can be purchased from Amazon, or to get free content and a chance to win a year’s supply of Source Climate Change coffee, sign up to my network here.