Brand is just assumed in the modern world, right? Most of us just taken brands as a given.
There isn’t exactly a lobby group out there promoting Big Brand. It’s just become one of those assumed functions. People just accept it and move on.
I think this is in part is because they’re ubiquitous in modern life. We buy brands. We build brands. We trust brands. We become brands.
So what’s my point?
Obviously the market has decided brand is something worth having and that suggests that it actually works. I mean, there’s been plenty of ideas about businesses that have come and gone but brand has stuck around.
Why? What does a brand do?
I mean really.
Why do businesses need a brand?
In historical terms, brand is only relatively new, a blip in the history of business. What is it about the time we’re living in and the culture we’re immersed in that makes brand such a compelling concept?
There are a bunch of surface level explanations. “They have one.” “It looks nice.” “This is just what you do right?” “It’ll help me sell and grow? Won’t it?”
But that doesn’t get to the real reason. So, let’s get to the heart of it.
Justifying brand requires an assessment from first principles. The most elementary layers which everything else is built on. It means we need to delve into fundamentals of human behaviours, market dynamics and the psychology of decision marking.
Let’s start by just lightly revisiting what a brand even is.
Brand isn’t a logo or a name. We like to work with Robert Jones’ working definition.
Your brand, fundamentally is the bundle of thoughts, feelings, actions and impulses about you that people have our there in the world – and that’s why it’s so powerful.
Curious to know more how we define brand, you can read our thoughts here.
So, why brand and what role does it play in modern life?
Brand as Identification
As humans, we have an inherent need to identify and categorise objects in our environment. While at one time this would have been crucial in helping us distinguish between friend or foe, safe or unsafe, it now helps us navigate the complexity of life and the plethora of products and services. It’s the equivalent of knowing that that plant is safe to eat, we can eat that again. Brands are like that. Brand once identified becomes a heuristic or shortcut in navigation.
Brand as Trust
Trust is essential in transactions. Without prior experience, consumers rely on cues to assess the reliability and quality of offerings.
Brand for Information Asymmetry
Sellers typically have more information about their products and services than buyers do. That makes sense right? Part of the issue of that asymmetry is that buyers can be confused or overwhelmed. It’s not that the buyers wouldn’t benefit from the offer, it’s just that it goes over their heads or that it’s too complex to dedicate the required time gain understanding of the value.
Brand here act as a signal of quality, performance and other sought after attributes to reduce the complexity within the decision making process.
Brand for Simplification
Audiences have limited capacity and energy to dedicate to research and evaluation. We’re all living busy lives right? Making a completely informed decision would require reviewing all the existing alternatives and we simply don’t have the time or desire to do so.
Brands simplify the decision making process by reducing the time and effort required by consumers to search for and evaluate products as services. Brands help consumers make an easy decision.
Brand for Risk Reduction
We all avoid making bad decisions, we have a real aversion to loss. Not just for the inconvience but for the loss of time, money and opportunity if we had made a better decision in the first place. Once an association has been established through experience, brand reduces the perceived risk associated with a purchase. We as consumer project a consistency of outcome on to a brand.
Brand for Clarity
In other words, focus. As the saying goes, you confuse you lose. It’s an attempt to avoid the temptation to be everything to everyone. You can’t say everything. You can’t be everything. It creates a healthy limitation.
Steve Jobs is attributes to saying this.
”It’s a complicated and noisy world, and we’re not going to get a chance to get people to remember much about us. No company is. So we have to be really clear about what we want them to know about us.”
Brand as a discipline places an emphasis on consistency of messaging and language.
- Clarity of Message: Inconsistent messages confuse consumers and dilute brand impact.
- Strategic Messaging: Brand strategy defines the messaging architecture, ensuring that all communications are clear and reinforce the brand.
Justification: Efficient communication is essential for brand recognition and recall. A strategic approach ensures that messaging is effective and resonates with the target audience.
Brand for Differentiation
In a sea of sameness, brands help companies differentiate their offerings allowing them to compete in unique forms of value rather than on price alone. It’s through this process of differentiation that brands can shape and augment the perceived value of a product or service through framing and reframing.
Brand for Consistency
Related to risk reduction, consistency in experience and consistency in outcome fosters loyalty. It becomes a heuristic. We come to expect the same value. It feels like a safe choice.
- Reputation Mechanism: Brands build reputation over time. A strong brand incentivizes companies to maintain or improve quality to preserve their reputation.
- Customer Loyalty: Consistency in brand experience fosters customer loyalty, leading to repeat business and long-term profitability.
Brand as Connection
Brand often evokes emotion. Both positive and negative. This can create a deeper and subconscious connection with consumers. This can influence purchasing behaviour beyond rational evaluation.
Brand as Expression
What was an artistic and philosophical movement, romanticism placed an emphasis on inspiration, subjectivity and the primacy of the individual. This focus on individual preferences over that of the group and that of elevating emotion over reason sewed the seeds of what would become referred to as radical individualism in the 21st century.
Without a deep dive into how exactly we got here. Brands become tools in which individuals can use to express their identity or communicate their values. In a way, brands becomes tools to create personal brands.
Brand as Alignment
We’re not in Kansas anymore. At one point in human history the family was the economic cente of society. The creation of the company radically changed everything. What came along with this change is scale. And with scale the number of people involved in a given enterprise. All of a sudden you had a melting pot of individual values, desires and worldviews competing in the same space. Brand offers a unifying worldview that creates a clear internal framework and guideline for various stakeholders and teams. Using brand to clarify what’s import and what’s not, leads to internal alignment and reinforces external perception.
Brands as a Consequence of Capitalism
From first principles, the concept of a brand emerges as a fundamental solution to inherent challenges in human economic activity. Brands address the need for identification, reduce information asymmetry, lower transaction costs, incentivize quality, and foster emotional connections. By fulfilling these essential functions, brands justify their existence as pivotal elements that enhance both consumer experience and market efficiency.
