The Buyer’s Psych – Brand And Trust

As a graduate student many years ago, I recall reading a study about the unequal purchase of more expensive branded food items in lower income areas, especially when compared to the purchase of “house brands” in upper income areas.  Further investigation revealed that in the lower income areas,  the more expensive “branded” items were thought to be more trustworthy, i.e., had more value, while the less expensive house brands thought to be not equal in quality.  For those of limited income, this perception (or belief) drove the purchase process, a behavior that was exactly the opposite of the economic theory.  The same survey, conducted in the affluent areas, showed that the buyers there were more willing to take a chance, experiment if you will, on the lower cost house brands perhaps because they did not have as much to risk.

The implication of this 50 year old survey resonates today, as we struggle with 9+% unemployment and 25M+ people either unemployed or underemployed.  Marketers have to maintain or establish a brand that is trusted, to capitalize on a buyer who is reluctant to risk scarce resources on new products.  Conversely, if the trust is lost, so is the buyer.

This is reflected in this 2009 chart on Brand Trust from Concerto Marketing Group.

            Brand Trust 2009

Maintaining a brand is one of the more difficult tasks.  In the market, the brand is under attack from competitors who are offering new features, discounts or blended services that are aimed at taking away the brand’s customers.  In the company, the pressure is on the development and manufacturing functions to make the same product, but at a lower cost.  While each change to the product/service may be subtle or appear inconsequential, the cumulative effect over time may cause customers to notice and reject the brand.  Or, the change can come from well intentioned causes, as NECCO found out with their wafers.  Regardless of the cause, once the trust in the brand has been lost, so is the customer.

Marketing’s role in this environment is clear… to do everything to maintain the status quo and to clearly communicate the brand’s value proposition.  50 years ago this was done by print and point-of-sale advertising, today it is done via Facebook pages, twitter and other social media tools.  The objective however is the same; reinforce the brand’s image, its message and its value.

At the same time the Marketing department has to fight the internal battle against changing the product.  This should include significant testing of any changes before allowing them to be introduced, as well as maintaining and expanding the same level of frequency and reach that was used to establish the brand in “good” times, regardless of the cost.

Typically, selling to a customer who knows you costs less than trying to sell to a new customer.  Knowing that customers trust your brand and are buying it provides a base or foundation…providing that you maintain that trust.  At the speed with which changes occur in today’s market, failure to maintain the buyer’s trust can be fatal to a brand.

If internal changes are planned for your brand in 2012, whether in formulation or resources, have you fully tested their impact?  (By testing I mean better testing than what Bank of America and Netflix did before they changed their products.)  Can you anticipate the external attacks and how you will respond?

 

RHM

11/7/2011

   

1 comment to The Buyer’s Psych – Brand And Trust

  • Jim Matorin

    So many touch points now that marketing must address which does make it more challenging than ever to clearly communicate a brand's value, especially as senior management is squeezing everyone in their organizations to deliver more profit that the company can hang onto.

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