Blog posts tagged logic

The funny thing about brands

Funny things, brands. As this BBC news story explains, the value of the world’s top 100 brands has increased in the last year, despite the fact that we’re being pulverised by the worst recession since – well, ever, probably.

Generally, the Brandz survey is fairly predictable: our lovely sponsor Google is a non-mover at number one, with a brand allegedly worth a so-much-its-silly $100 billion. Value-for-money retail brands are up, car manufacturers and financial companies are down; mobile phone brands are collectively outperforming everyone else. There’s no sign of the Marketing Donut (current brand value: £1.50 and two bags of Haribo), but I reckon we’ll be knocking on the door next year. Ahem.

So anyway, it strikes me that increasing your brand value during a recession is a pretty clever trick to pull. We’re used to casting brand experts as slightly sinister magician types pulling off clever deceptions (more David Copperfield than Paul Daniels, I would suggest) - but how the hell are they doing it?

My reading is, broadly, that the list confirms that trusted brands provide us with an anchor in stormy waters. As the waters swell around us, so we cling more strongly to what is familiar and dependable. The brand owners may not increase their revenue during a recession, but firms such as these can certainly consolidate their reputation – and this means they can make serious money when the upturn begins.

So if it’s all so obvious, why am I bothering to blog? Because the BBC has picked up on three brands whose good performance seems to defy easy explanation. None of McDonalds (+34% in value), Marlboro (+33%) and Budweiser (+23%) can really be called a necessity and you might think they would be among the first things struck from the shopping list when money is tight. What’s more, these brands are under attack as public campaigns against junk food, smoking and boozing take root in our culture. Logically, all three brands should be experiencing a decline.

But of course, brands are not logical – their value is strongly influenced by their emotional resonance. Each of these three are experiencing either increasing sales or steady sales – remarkable when you might expect the typical McDonalds, Marlboro or Budweiser customer to be munching fewer Big Macs, smoking fewer cigarettes or downing fewer Buds. What does this say about us as consumers?

Certainly, that we don’t necessarily make rational or predictable choices. It also says that we continue to treat ourselves when times are hard and that we value our treats more than ever. It might also be saying that we’ve decided to forget the future and throw ourselves collectively to the four winds, indulge our pleasures more than ever and let the fates decide where we end up. Seriously – that’s a possibility.

So really this is a story about consumers and not about companies. It’s about the rational and irrational impulses that drive us to endow something with value. I reckon there are three simple lessons we can draw from the BBC article about the Brandz survey:

1)     We are more likely to turn to trusted brands when money is tight

2)     We value what they have to offer more than ever

3)     We do not necessarily make rational choices.

Funny things, customers.

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