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November 12, 2004

The Value of a Brand -- Part 2

In HBO's hit "Sex and the City" the ladies loved their Manolo Blahniks. Their fetish for Manolo's mules did more for the brand than any advertising could. And why not? Manolo Blahnik's were no longer about a $500 pair of frivolous shoes but for sexiness, sophistication -- and mandatory attire for anyone in serious search for Prince Charming. That is the power of a brand, when rational thought is all but abandoned and psychological needs are addressed, see Media Knowall's cliff notes on Branding.

Once a brand has reached the status where a want becomes a need, price becomes secondary. When a product is a need, brand affinity is solidified. It doesn't matter how inexpensive the Lexus is if the need is for a BMW.

In high-end luxury items, the role of the manufacturer is to equate how the product betters the life experience of the buyer. According to a report from Unity Marketingmanufacturers "need to maximize the life enhancing qualities of their products and services" for the buyer.

In Unity's report Luxury Category Brand Loyalty Index, Autos and Electronics top the list of brands that maintain consumer loyalty, while appliance fall about mid-range. Home furnishings, floor coverings and window treatments are saved from the bottom by jewelry.

Interestingly, art and antiques conjure up much more brand support. So is the brand for furnishings truly superfluous or is something wrong with the perception of the brands? And then again, as my last post on branding said, you nary can find a brand label on home furnishings products.

To generate value in a brand and loyalty for a brand, here are New Year's Resolutions that manufacturers should make for 2005.
* Stop allowing retailers to eliminate labels from goods. Better still, create a mark that can't be removed -- a design element in a knob, a signature on a trestle, an etch in glass -- something.

* Differentiate your product -- not with features -- but with experiential benefits.
* Start looking for ways to get product placement -- movies, tv shows, articles. It has greater impact than advertising -- and helps to create to that "betterment of life experience."
* Get your name out there. Yeah, advertising and promotion costs money. But think of it as an investment not an expense. If your budget is really tight, target specifically to your niche.
* Create a brand awareness program with your retailers. When you open up a new dealer -- send them a turnkey press release that the retailer can send to the local press saying how they are now carrying your brand. The investment is 37 cents for a stamp, less if they fax it to the press.

The first steps allow you to build value in your brand which the consumer will covet. The latter move allows you to position your brand as an asset to the dealer. The dealer gives you hell about putting your product on a website -- because he sees it as a license for consumers to shop for the best buy. By you promoting in tandem in the local market, you help guide the customer to the retailer. Trust me, if a dealer gets walk in traffic for people looking for your brand, he will thank you not bitch.

Will there still be channel conflict, ie. will some dealers bitch at you because they lose a sale to an out-of-towner who is a little cheaper? Indeed. As long as humans have vocal chords, there will be those that bitch.

You have some choices:
* turn a deaf ear
* hum while they talk
* suggest they sell some models exclusively (could be just an exclusive finish)
* find a less vocal dealer

The point is, the retailer is your connection to the customer. If the retailer severs your connection by relegating your brand anonymous, then there is no chance for brand loyalty to ever be built.

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