See, Solve, Scale by Danny Warshay

Author:Danny Warshay
Language: eng
Format: epub
Publisher: St. Martin's Publishing Group

Brands Are Like Magic: They Reduce Searching Costs

One of the assets that all ventures should develop early is a strong brand—the relationship your customers have with your products. Brands seem to have magical powers. They create value in what would otherwise remain a commodity. They attract new customers who will even pay a premium to try your products. They help make those customers loyal to your products. Sure, the Duncan Hines baking mixes that I worked on at P&G had a slight product superiority, but it was the decades-old and continually refreshed brand that motivated families to try Duncan Hines products, to stick with the brand and refuse to buy a competitor’s, and to ignore the same baking ingredients they already had in their pantries. It is the American Girl brand that causes children to love their American Girl Dolls and their parents to pay a hefty premium versus what other similar-looking dolls might cost. Many Stonyfield Yogurt eaters will walk out of the store without any yogurt before they would even consider buying a competitor’s. And if they encounter a store that doesn’t carry Stonyfield, they will lobby the store manager to order it. Trader Joe’s supermarket shoppers drive miles out of their way to shop at a small store with a small selection of products, most of which are sold under the Trader Joe’s brand. Brands are powerful, and every venture should invest in its brand to help it scale.

It turns out there is also a hardwired reason that brands work their magic. As Alec Beckett, Creative Partner at NAIL Communications, shared with me,

In our neolithic past, the ability to make a quick recognition evolved as a life-saving shortcut. You are scavenging for food. You come across two berry bushes—one you recognize and know as safe and one you don’t. You could stop and study the unknown berry. You could take a tiny taste and see if there is any potentially toxic bitterness. You could observe whether other animals are safely eating it. You could look for similarities to other safe berries you know. You could, but you can’t waste time or risk exposure to predators.

This is at the very heart of branding. Our brains desperately want shorthand signals that make decisions easy for us.

This is why brands exist. A brand’s job—first and foremost—is to reassure me that this isn’t a poison berry.

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