Wednesday, March 20, 2013

Dispatches from Marketer World: Part 2— Brands

What better way to emphasise the regularness of this feature than to include two in a row?

If I'm to make a habit of highlighting how marketers think (as gleaned from the types of questions they ask or fail to ask in market research surveys), I suppose it's best to start by addressing the biggest concern: Brands.

What is a brand? I'm sure you already know that. A brand is a name, a logo, a design, a slogan; a bit of intellectual property too small or simple to be eligible for copyright protection (usually), but protected by trademark instead, and used by its owner to mark a product as having come from them.

Marketers, however, use the term "brand" to refer not only to the trademark, but to the product emblazoned with it, the company that owns it, and (in most cases), anything that can be identified as a cohesive entity. To us regular people, this is a brand. To a marketer, however, the physical can of sodypop with that logo upon it is also a brand, as is the Moxie Beverage Company that made it, and Cornucopia Beverages, the company that owns them. To a marketer, even a non-profit entity such as Oxfam or a semi-organised social movement such as Occupy Wall Street is also a brand.

This oddly expansive definition of the word "brand" means that most market research surveys are written in a comprehensible-but-awkward creole where I'm asked to evaluate a brand, provide opinions on a potential new brand, all so that an existing brand can better make decisions about which brands it should create in the future.

The over-reliance on the slightly misused word "brand" makes it a little bit difficult to comment on this next topic, but I'm fairly certain that marketers are overly concerned with brands above and beyond their obsession with the word itself.

Nearly every market research survey either assumes that which brand is emblazoned in a product must necessarily factor into my purchase decisions to a much greater extent than it actually does. It makes sense that they would think this way; they've almost certainly invested a lot of time and money in the idea that the key to success is to advertise a brand and assume people will buy products based on their resulting familiarity with the sight of the logo. Unfortunately, this just isn't the case.

Not all products are created equal, and because a brand connects a product to its manufacturer, a brand can serve as a proxy for distinguishing quality manufacturers from those best avoided. However, brands are a limited and flawed proxy at best, for several reasons.

First, the vast majority of our purchases are for small everyday things like toothpaste and napkins. These items are called parity products, meaning that all the choices on offer are the same in every respect (except, potentially, price). Many of the market research surveys I've taken asked me to evaluate a new sales pitch or piece of ad copy for one of these products, and then asked me to what extent it made me more likely to purchase the product made by the advertising manufacturer; those marketers were fooling themselves because price is the only consideration on these products.

Second, even when there are distinct differences between manufacturers, brands don't correlate to manufacturers directly. In many cases, a heavily advertised brand and a less advertised brand will both be placed on the same product; the former will be more expensive than the latter despite being exactly the same thing. It's generally a safe bet that any product endorsed by a celebrity can be found much cheaper by looking for one without the celebrity-endorsed brand slapped on it; unless you want to pay money to a celebrity who doesn't need it or deserve it, you can probably find a non-endorsed version of the same product cheaper.

Third, even when a brand directly correlates to a specific manufacturer, brands can be bought, sold, traded, and licensed like any other form of intellectual property. Many years back, my family would make a point of obtaining Stella D'oro cookies whenever we could find them. The Stella D'oro brand was owned by the Stella D'oro Biscuit Company, so any product with that brand was made by that company. The Stella D'oro Biscuit Company produced all of its delicious biscuits at a plant on West 237th Street in the Bronx, employed union workers and paid fair wages, and used high quality ingredients. If you saw the Stella D'oro brand on the package, you knew it was quality stuff.

Problem is, then the company got sold, first to Nabisco, then to Kraft Foods, then to Brynwood Partners, then to Snyder's-Lance, Inc. Snyder's-Lance and the various intermediate owners closed the Bronx facility and demolished it, fired the union workers and moved production to a state that banned unions so that they could pay insufficient wages to their employees, and cut back on manufacturing costs by switching to lower-quality ingredients. Any product with the Stella D'oro brand on it today is low-quality garbage churned out by a conglomerate, made by underpaid workers in a state you'd normally fly over.

But the brand hasn't changed. Snyder's-Lance, Inc, may be the antithesis of the family business which made the stuff I used to love and their products may be poor imitations of my beloved biscuits, but the brand is exactly the same, because they bought the rights to use it. This isn't the only case where a company bought the rights to a brand associated with quality goods in order to use that association to peddle crap but it's the one case I always think of because of how thorough the reversal was.

Maybe I'm unique in this respect - an extreme outlier on a chart of the advertising-molded opinions of sheep - but I refuse to believe that the advertising industry's obsession with brands actually has any meaningful effect on consumers' purchase decisions.

As far as I've always been able to figure, advertising is what corporations do because they're not physically capable of masturbating.

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