Brands are engines for business growth – and social transformation
Brands don’t just affect the markets they compete in. They do so much more.
Start with the personal. People can – and do – form ‘relationships’ with brands. They have brands they love and brands they hate. Sometimes the same brand inspires both reactions among different groups: think of Apple, or Manchester United.
But beyond that, brands have been one of the most important agents of change we’ve ever seen – economically, behaviorally and culturally. Brands have shaped what we eat and drink, what we read and watch. They have shaped how we travel, how we go on holiday, how we bank. They have changed how we meet potential partners, what we give as tokens of betrothal, and even how we think.
Of course, brands have long since evolved from their original role as a mark of ownership. They became the silent salesman. More recently, they became the personification of a set of values. In turn, this has led to their latest role, helping a company define its purpose – highlighting a company’s ability to be a force for good, not just a means to generate profit.
Along the way, brands have been huge generators of income and profit for their owners, often earning billions of additional dollars every year above what a firm might make if it was supplying generic goods and services. However, this isn’t their only economic impact. Many have introduced new ways of doing business that have been adopted across a variety of markets.
Brands like Sunlight – the inspiration of William Hesketh Lever, launched in 1884 – helped shift people away from buying commodities to packaged and advertised brands. Lever saw that a consistently branded pack was a better guarantee of quality than an anonymous block of soap in a general store.
Gillette also introduced a new way of doing business, the razor-and-blades model. It revolves around selling a core product at a low price or even a loss (in Gillette’s case, the razor), which locks the buyer into purchasing a stream of complementary products (the blades). It is from this ongoing stream of purchases that profits are generated. This is still the business model used by brands like Nespresso, Nintendo and Hewlett-Packard.
Brands have driven behavioral changes too. De Beers was founded in 1888, but even as late as 1938, only 10% of engagement rings included a diamond. Only after the famous 1948 ‘Diamonds are forever’ campaign did things begin to really change. By the end of the 20th century, 80% of engagement rings contained diamonds. Small wonder that ‘Diamonds are forever’ was proclaimed the slogan of the century by Advertising Age.
Clarence Saunders’ wonderfully-named Piggly Wiggly brand changed the way that people shop. Inspired by seeing a litter of piglets, Saunders replaced general stores and their clerks when he opened his first ‘self-serving store’ in Memphis in 1916, complete with shopping baskets and open shelves stocked with products.
The third type of change inspired by brands is cultural. Coca-Cola could be included on a number of grounds. It helped drive the spread of the idealized American way of life. And while it wasn’t the first brand to use a rotund jolly Santa dressed in red and white, its consistent use of that imagery (and huge advertising budgets) established a powerful link between the two.
When we think about how we’re building a brand, we should dream big – because brands have more power than we realize. Brands are agents of change, and they have shaped all of our lives.
Giles Lury is a freelance brand consultant
