Decline of Brands?
November 09, 2004 | 
30 Comments
Summary: Musings on the thought that branding and the value of brands may be on the decline.
My new coworker, Mark, pointed me in the way of an interesting article by James Surowieck, the author of The Wisdom of Crowds.
It is a great read that really got me thinking. It talks about how branding, and brands, are declining in importance, mainly due to easier access to product and company information and more intelligent and informed consumers. I think he may have something when he talks about the decline of some brands. Those who think of their brand as nothing more than a logo, for example.
However, and keep in mind I’m no expert, I think the demise of branding and the death of brand value might be a bit premature. In fact, if you have a quality product or service and want to be the best in your area, your brand could be the key.
Branding is Still Important
When we’re talking about products and services on the low part of the brand totem pole I can maybe see what Surowieck is saying, but I’m not sold on the idea that a great brand doesn’t make all the difference when you’re competing at the top. In order to succeed at the highest level you need to do something remarkable and your brand should be part of that.
If there are so many choices, and there is so much information available about those choices, then a brand could be all that’s left to help a consumer make a decision.
Look at Apple, Sony, Target, Google and other strong bands. It could be said that brand strategy is essential to their continued success. Of course it goes without saying, with Apple for example, that a high quality product is easily just as or more important than their brand, but that doesn’t, in my opinion anyway, mean that they should be neglecting that brand.
I don’t disagree that brands in general might be on the decline and that for many companies this might mean less importance on branding and the consumer has more access to information and more choice. However, what this says to me is that nurturing your brand, and building that brand upon things like solid service, innovative ideas, a connection with your customer, a feeling of belonging and other things that ad “real” value to your customers, is of the highest importance.
Branding is more than just your logo. Sure we’re awash in new products, services, logos, trademarks and more. As well, we have remarkable access to information about all of the above. This just means brands need, more than ever, to be built on things that really matter (the product or service) and it’ll be even more important for brands of the future to stick out from the crowd.
Surowieck says:
The world, it seems, is disappearing beneath a deluge of logos. In the past decade, corporations looking to navigate an ever more competitive marketplace have embraced the gospel of branding with newfound fervor.
And:
Over time, certain brands came to connote quality. They did provide a measure of insurance - which in turn made firms less innovative and less rigorous. (Think of the abominable cars General Motors, Ford, and Chrysler made in the late 1960s through the 1970s - remember the Pinto? - in part because they assumed that they had customers for life.) That sense of protection is eroding in industry after industry, and instead of a consumer economy in which success is determined in large part by name, it’s now being determined by performance. The aristocracy of brand is dead. Long live the meritocracy of product.
While the “aristocracy of brand” might be of less importance than it used to be, I don’t think brands are dead at all. Companies will just need new, powerful and creative ways to make their brands more meaningful and effective. They’ll need to get back to being “innovative and rigorous” and not rely solely on their name and logo to sell. Brands will become more about a relationship with the customer instead of just a logo, colors and typeface.
The same ol’, same ol’ won’t be enough and when it comes to branding I think some new ideas, and some new ways of doing things could make all the difference. It could be that, because there are so many brands, and your new, more educated customers are have more information and more choice, that now, more than ever, making your brand the best it can be—and setting your brand apart—should be even more important.
Filed under: Marketing and Branding
Comments
1. Seth Thomas Rasmussen said:
I welcome the demise of the brand. It will always be beneficial to define ones self or ones group, and have a consistent image, etc. That’s all common sense, but the importance of the brand is completely out of hand in our culture and in the minds of advertising executives. (Eww, I feel gross just typing that out, knowing it was in my head… *shudder*)
Google is strong because they offer top-notch services. If you look around their various sites, yeah there’s plenty of connecting threads as far as logo treatments and visual styling, but those things clearly take a back seat to what they can actually do.
That’s how it should be. Death to the brands!
Posted on November 9, 2004 02:04 PM | #
2. Dave P said:
Amen Seth.
We harp about content over presentation for websites, and the same holds true for brands.
Your consistant, professionally designed, forward thinking branding isn’t going to help you much it your product and/or customer service is a steaming pile of poo.
Posted on November 9, 2004 03:38 PM | #
3. John Zeratsky said:
Looks like Seth thinks of a brand in terms of logos and visual presentation. Google is one of the strongest brands in the world, because they offer great services, good support and becuase they embrace the community of developers and web nerds that make them even better.
Just because Google doesn’t shove their ugly logo in your face or get their jingle stuck in your head doesn’t mean they are any less of a brand. And it’s not a good example that brands are dying.
Keith is right – brands aren’t going anywhere, but it’s time some brands grow up. A brand, at it’s core, is basically the same as a reputation. Do good and your reputation (and your brand) will prosper. Treat your customers like shit, offer bad products, and your brand will faulter.
Posted on November 9, 2004 03:44 PM | #
4. Sage said:
I agree with pretty much everything that’s been said �€“ while brands aren’t as important as before, they’re still important enough.
Small, stupid example: The other day, I went to buy pens, because I had two pens that magically ran out at the same time. They were both Pentel pens that I bought in a pack, and I only bought them a couple weeks ago. So, I obviously wanted to avoid buying another Pentel pen. In my backpack, I had a Uniball pen that I’ve been using for a couple years, and it writes beautifully (it doesn’t feel like a ball point pen at all). Thus, when I arrived at OfficeMax, I went looking for Uniball pens, and that’s what I bought, and I’m very happy with the ones I got.
I could’ve tried other pens �€“ other brands, cheaper brands, maybe even better brands. Since I’m not a pen expert though, all I knew was that Pentel had failed me, and Uniball had served me well, so I was committed to getting Uniball pens. If these new ones that I got also failed, then I’d get a different brand, but since they’re fine, I’m fairly committed to the brand. Branding can help you shop smarter.
Posted on November 9, 2004 04:34 PM | #
5. Zelnox said:
Tonight, PBS aired a program called “The Persuaders”. I did not get to watch though, because I was watching something else ^_^. May be interesting to you. It’s about branding and stuff like that.
Posted on November 9, 2004 07:30 PM | #
6. David Chen said:
A brand is only as good as the effort put into it, and can be even detrimental. Compaq tends to have a bad reputation, for example. It’s not about how cool a logo looks or how often it is seen, though those things build brand awareness. People gain an expectation for future results based upon past experiences with a brand. A brand to me has always been more of an identity, kind of like me leaving my name with my comment. There’s usually immediately a little more respect just because a person is willing to risk his identity backing up his words; but in the end, you might just remember me as a jackass. Hopefully not! ;)
It’s less obvious for companies because they consist of many people. Unless there is strong leadership, it feels like less of an identity. It’d be like a certain set of people leaving their name as David Chen instead of just me.
Hmm, this comment could be phrased better, but I’m about to be late for class…
Posted on November 9, 2004 07:40 PM | #
7. Geoffrey said:
Another good example of a brand being much more than the standard marketing crap and more about service is Amazon.com. Amazon is the biggest thing on the Web because of the trust the have instilled in their customers. I bet the average Amazon customer couldn’t tell you exactly what Amazon’s logo is offhand. Unlike Nike, which inspires instant swoosh recognition. I bet even more people don’t realize that Amazon’s logo is not just a smile, but an arrow that represents “From A to Z”. The point being, Amazon is a highly successful brand based on highly consistent, quality service. Period. They don’t really need a huge marketing/brand campaign, the brand sells itself. The brand is the experience.
Posted on November 9, 2004 07:51 PM | #
8. Jason Beaird said:
Wow, what a range of opinions! For what it’s worth I believe that corporate identity and branding are stronger today than ever before. On the web we tend to think of imagery and logos as identity. Just think about all the environmental design that goes into franchised resturants. Think about the jingles and phrases that we associate with TV commercial brands. Just picture in your head the standardized look and feel of your favorite gas station. The ability to identify with a service or product can make or break a sale. Anybody in design, business, or advertising can tell you that. Long live the brand.
Posted on November 9, 2004 08:07 PM | #
9. Ray said:
If you welcome the demise of the brand then you’ve never owned a great product offered by a great company or you’re confusing “brand” with image… or you don’t know what you’re talking about.
It is true a number of companies are highly skilled at pitching their products with fancy imagery but there are also a good number of companies who understand the importance of developing a truly great product or service that’s backed by a well thought out business plan. A business plan that focuses on first developing rapport and then a lasting relationship with their clients.
When I think of “brand” I don’t think about pleasing colors or smart typography. I think of the relationship that’s been built (over time) between a client and the company who earned their business. Yes, the packaging is important as is a recognizable logo but not in and of itself. A fitting analogy might be the dating ritual of some guys and gals. “Some” guys get all waxed up on a Saturday night with the idea of seeing who or how many they can fuck. Same goes for “some” of the gals. These people are only thinking in the here and now. One dimensional. And that’s OK if that’s you’re thing. Just don’t plan on being around for a long time. As the old saying goes… “You can fool some of the people some of the time… ”
Then there are other guys and gals who get all dressed up because they understand the importance of first and lasting impressions. They understand there’s more to life than a quickie. They understand the merits and benefits to all involved, of the long term relationship. They understand that a relationship worth building is a relationship worth working on. They understand “presentation”. They understand “packaging”. They understand the importance of good communication. That’s called good branding and it’s all part of a solid business plan. Smart companies are like smart people. They know how to best present themselves in an honest light.
Give me a good brand any day over an unknown. God knows what one might catch these days.
Posted on November 9, 2004 08:20 PM | #
10. Taco John said:
I think everyone is missing the article. You’re all really agreeing with it. I don’t even thing the author knows he was making this point. It now takes the consistant delivery of some utility to the customer to build a brand. I think we would all agree that BMW, as a brand is very strong on delievering quality, luxury, and performance. However, in the eyes of many enthusiasts and writers, a number of BMW “innovations”, such as the new rear styling, iDrive, and active steering have injured the brand BMW had built as “the ultimate driving machine.” I really think that’s the sort of thing that the article is trying to get at. Here’s a company with a great brand, and one which really sticks to the qualities associated with the brand. However, even in delivering what many customers would say is more, they’ve done damage to their brand. And what has happened? Mercedes, always better at selling “Teutonic strength”, technology, and “German Engineering” has stepped up, decoded a lot of BMW secrets about ride and handling, and created a better version of what BMW is trying to accomplish. Audi has come out of virtually nowhere to make serious noise among the German luxury brands. Acura is beating BMW in comparison tests, where before most BMWs were untouchable. I just think in trying to say that companies will no longer be able to think brand = logo, in the exerpt posted here, the author made that mistake and used the words interchangeably.
Posted on November 9, 2004 08:59 PM | #
11. Josh Johnson said:
It’s very interesting that you bring up the topic of brand, because I was having a related conversation with a co-worker the other day. The gist of it was: If you’re not a top-tier brand like Sony, Apple, etc., but your brand has global recognition, how do you leverage that asset into money in your pocket.
Obviously top-tier companies want to maintain that brand, and do so by developing, licensing, and/or selling quality products, which keep people coming back for more each year. This puts money in the pockets shareholders and employees, but is hard to do successfully.
On the other end of the spectrum, you can sell off the company (brand and all) and watch the buyer milk what they can out of it ‘til it’s dead, ala Napster. This puts money in the shareholders pockets, but leaves employees high and dry.
Lastly is one that people don’t talk much about, but is intriguing. Take your well known brand, and attach a lot of cheap shoddy products to it, that you sell lower than previous products. You’ll see an initial increase in volume sales and the bottom line, but value of the brand will sink at an equal rate, with the lack of repeat customers. What’s really interesting is that it’s the employees (usually execs) who will see the profit in the form of sales bonuses, et al, and it’s the stockholders that get left holding the worthless brand in the end.
Just some food for thought regarding what may happen to some of these brands as they begin their demise.
Posted on November 9, 2004 09:04 PM | #
12. Keith said:
It seems like this is a hot topic of late in a few circles. Here are a few links from some more branding-focused blogs I read:
Jennifer Rice – Rebranding The Brand
Hugh Mcleod – Why Branding is Dead
I think the conculsion many are coming to is that branding isn’t “dead”, it just needs to be redefined in many people’s eyes.
I’m new to this stuff, but I’ve never thought of “branding” as the sum of a visual system. To me it’s always been about the perception of a company (or service, product, whatever) in people’s mind.
If that is the case then “branding” is alive and kicking.
Posted on November 10, 2004 08:24 AM | #
13. Seth Thomas Rasmussen said:
The strong emphasis there is mine. What I emphasized is, more than anything, what I take issue with in branding.
When we’re talking about the image, impression, etc. whatever of the company, then all of that falls under what just seems like common sense practices in my mind. You should have a consistent image, you should style yourself as you see fit, etc. You don’t need a term for that, unless you need a dictionary of terminology to jutsify the existence of pundits and supposed experts.
But the use of branding as a means of manipulating peoples’ thoughts about a product or service is unhealthy, irresponsible and dishonest. Ms. Rice says modern branding is about “reputation.” Instead of trying to manufacture a good reputation, why not let consumers come to their own conclusions using simple facts about the product or service in question?
Oh yeah! Because then a lof of branding companies and businesses that rely on their overinflated brands might not make so much money anymore!
It’s a tough point to criticize any of this though, because ultimately it still boils down to the potential customer: they have the capacity to see through the bullshit. As long as they are content to be impotent and uninformed, then you’ll still see things like Scope’s overpriced mouthwash outselling the “generic” brand, despite labels clearly stating that they’re the exact same product. You’ll still see Levis marketing jeans for this group and jeans for that group and charging retarded prices for the lot of it, despite the fact that jeans are jeans are jeans are jeans and they all cost about the same amount of nothing to make.
The sooner we melt the golden calf of branding and those types of practices die off, the better.
Posted on November 10, 2004 10:56 AM | #
14. Dave P said:
Seth, Amen again.
One thing I’d like to point out though is that you will have people argue with you until they’re blue in the face that the Scope mouthwash is somehow “better” that the other just because it’s scope, even after you point out the obvious.
What you pointed out is exactly what I hate about branding. It’s one thing to build a reputation, and to continue to deliver on it; what branding does though (although not always), is promote the brand, period.
The effects can be felt in two ways:
1. The “brand” warps the consumer’s experience into a loyal following, in as much as the consumer finds it more difficult to become “disloyal” to the brand, regardless of the actual quality of the product/service recieved.
2. The “brand” promotes itself at the expense of others. ie, the connotation, deserved or not that a non-Scope mouthwash is somehow “inferior”. Branding at it’s core is a very mild form of FUD, if looked at cynically.
Branding has one purpose: to remove as much of the decision as possible from the consumer about which product to purchase. What it leads to is a less informed consumer. Sage’s example with the pens is a perfect example of this. A less informed consumer is arguably a bad thing for society when the consumer is the focus such as in the case of ours.
Food for thought, that’s all…
Posted on November 10, 2004 12:01 PM | #
15. Matthew Welle said:
But you can’t assume that consumers are going to make completely informed decisions about every single product they buy. If I’m going to the store to buy tissues, I’m not likely to do research beforehand on which tissue has the best quality, or which one has the most “bang for the buck.” So when I go to the store, I face a decision – do I buy Kleenex, or the cheap stuff?
That decision is made by the amount of utility I get in buying the premium product vs. the cost difference between the two. If I intrinsically believe that the Kleenex product is much better than the cheap brand, then I’ll pay the extra $0.30. If I think the two products are the same thing, I’ll go with the cheaper one.
So what determines the amount of utility I’ll get from buying Kleenex tissues? Branding. And what determines the quality of branding? Marketing and product quality. Kleenex can spend a ton of capital on product quality and none on advertising, and their brand image will at some point be the same as if they spent all of their money on marketing, and none on quality. The key is to find a way to maximize utility by allocating resources between these two broad categories.
In this respect, everything is a brand. Traditional advertising may be in decline, but branding is so much more than strictly advertising. Branding will be dead when companies no longer need to compete for your money.
Posted on November 10, 2004 12:43 PM | #
16. Dave P said:
Ahh… but they should be doing exactly that!
Branding is part of the problem in that it encourages ignorance of the product and/or company, in favour of the brand itself, which is in effect the product as the company wishes it to be displayed!
Branding encourages consumers not to worry who actually made the jeans they wear (some kid in a sweatshop), only that they’re “gap” brand.
Branding and “propaganda” are exactly the same thing. In saying that, even honest governments can use propaganda in a morally just way, it’s just a matter of control.
Posted on November 10, 2004 01:19 PM | #
17. Seth Thomas Rasmussen said:
Gah…
No.
What determines the amount of utility you’ll get from Kleenex tissues is the tissue itself, its product quality, and your personal experience with the tissue. How much utility you think you’ll get is influenced perhaps by branding, but to make this leap in logic that the branding somehow determines the usefulness of a product is frightening.
Posted on November 10, 2004 01:33 PM | #
18. Keith said:
This is going slightly off-topic into a semantic discussion over the definition of branding and what a brand is.
In my mind some of your (Seth and Dave) definitions for branding is different from others.
Branding (to me anyway) doesn’t necessarily have anything to do with propaganda (or encouraging consumers not to worry who actually made the jeans they wear) as Dave puts it. Not at all. It’s much to complicated and diverse a subject to be simply branded (sorry for the pun) in that light.
EVERY product has a brand perception. Even generic products. Everything. It’s unavoidable. Non-branded is branded. Branding can be more than just that perception. It’s can be a personal relationship with a product, service or company.
Seth mentions personal experience with a product. This is branding.
I think there might be some violent agreement going on here either way, I’d like to steer this away from this semantic debate.
Posted on November 10, 2004 02:40 PM | #
19. Matthew Welle said:
Ah, not true. A consumer’s perception is his or her reality, therefore branding can absolutely determine the usefulness of a product. It is cognitive dissonance. If I go to the store and buy Kleenex, I will probably argue that the tissues are clearly softer and of better quality than the private label option. Likewise, if I buy private label, I’m going to tell you that there is no difference between the two. It sounds silly, but it is a principle of psychology. This has been proven in both laboratory settings and in real life over and over and over again.
Ever noticed how fiercely party line voters will defend their presidential candidate, regardless of whatever amount of incompetence he may have shown while in office? Why do you think that is?
Posted on November 10, 2004 04:58 PM | #
20. Seth Thomas Rasmussen said:
Hehe… “violent agreement”…
Posted on November 10, 2004 04:59 PM | #
21. Seth Thomas Rasmussen said:
Mr. Sir Dude Welle,
I understand the psychology, what you are saying, etc… but I am confused by you. I don’t understand what point you’re trying to make.
Posted on November 10, 2004 05:09 PM | #
22. Mark Burgess said:
The idea that a brand is the sum of personal experiences with the company and its products, the perceptions generated by marketing, word-of-mouth reputation, etc. is a new one, and that’s the point of the article. Today’s consumers are too cynical to be brand-loyal just because they’re a “Ford person” or a “Pepsi person.”
It’s that cynical post-modern slacker thing that Sprite is trying to latch onto (ironic (and that’s the point)): “Image is nothing, thirst is everything.” Ignore our marketing campaign (and those of our competitors, btw), and pay attention to the flavor, or quenching-ness, or whatever.
Of course, brand is vital for differentiating, and for hanging on to whatever hard-won loyalty the company has managed to eke out, but that loyalty only lasts as long as the “stuff” is good. I like Uni-Ball pens too (not because of the logo, or their horrible Flashiful site), and appreciate the fact that I can buy a pen I know I like, based on experience. Conversely, if they change the way the pens work, and the one I’m writing with starts gooping up or whatever, I can use the branded-ness of their line to eliminate a whole range of possible purchases.
Posted on November 10, 2004 05:19 PM | #
23. Matthew Welle said:
Sorry, Mr. Seth Thomas, I’m not clear at times. :)
All I’m really trying to say is that it isn’t a “leap in logic” to assume that a consumer’s perception about a brand is one of, if not the most important, factor in his/her belief in the quality of that product. You said:
And I’m arguing that, more often than not, the branding does in fact play a big part in determining the “usefulness” of a product for a consumer. That said, I don’t like the word usefulness…that is a big difference from utility, which is what we really need to be speaking to when we are talking about the importance of brand. Usefulness is only a part of a consumer’s overall satisfaction with a product. And in that sense, with the ever increasing amount of information available about any given product, and consumers’ willingness to dig for that information before making a purchase decision, it is more important than ever for a company to have a strong, consistent brand that connects with its target market.
Posted on November 10, 2004 09:30 PM | #
24. Seth Thomas Rasmussen said:
“his/her belief”
See, that’s where you lose me. I do not consider their beliefs about what the product’s worth is to be a reflection of or relevant to the reality of the situation. Yes, we can split hairs all day on what reality is, but you know that’s not the point.
Using the Scope example: The generic brand is the same thing. The exact same thing. The “stronger” brand of Scope is actually just the success of preying on people’s ignorance, their psychological tendencies, etc.
Some people call that successful branding. That’s what I hope to see die off.
Posted on November 10, 2004 10:10 PM | #
25. Mark Burgess said:
A good brand may add profit, but it adds value too – or at least represents some added value. Is the label nicer-looking? I might pay a little extra for that. Do the happy people in the ads make me feel better when I use it? Heck, if I have to choose between a mouthwash that makes me happy and one that simply makes my mouth smell better, I’d go for the branded product. (But: feeling frugal makes me happy too, *and* saves me money…)
The thing about the Scope example is that it’s just a product, and its little-b brand is little more than marketing + packaging. That old-fashioned sort of branding is what has a hard time keeping loyalty, thanks not only to competition with generics but also with nicely-desiged competitors who may or may not be selling the exact same thing. It might command a few extra cents at the register but that’s not making anybody rich.
Posted on November 11, 2004 08:48 AM | #
26. Ray said:
“IF” brand dies and only superior products rise to the fore then we will have come full circle and the top products will need to get back into the “branding game” to separate themselves from other equally superior products (read: stay alive).
Capitalist economy. Gotta love it.
Posted on November 11, 2004 12:06 PM | #
27. Seth Thomas Rasmussen said:
“Capitalist economy. Gotta love it.”
Heh, no you don’t. ;)
Posted on November 11, 2004 02:39 PM | #
28. Ray said:
All political discussions aside…. what in God’s name do you think makes your little world turn? The one with a computer and internet access? Do you really believe even for a moment this discourse would be possible if it were not for a capitalist market. What do you think made it possible for Gates and Jobs to do the things they’ve done? I’m not asking you for your input on how YOU “feel” about Gates and Jobs, I’m asking you about the environment that made it possible for them to pursue their respective endevours. (If you live in a socialist or communist country please ignore these question.)
Oh ya, how do you plan on ruling the world? With love? You don’t strike me as a Gandi or Jesus type.
Posted on November 11, 2004 05:48 PM | #
29. Seth Thomas Rasmussen said:
Hahaha… so defensive of capitalism! Was capitalism your idea or something? My oh my, and my facetious little comment got under your skin enough for you to criticize my character, even! How quaint!
i xoxo
P.S. Are you really so naive as to assume that I don’t understand how capitalism played a role in what I have and am experiencing right now? Give me a break.
Are you left over from the red scare or something?
Posted on November 12, 2004 09:04 AM | #
30. Ray said:
See… he bit ; )
Posted on November 12, 2004 09:50 AM | #
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