There is a lot of research done around brands – brand image, brand equity, etc. We often try to answer questions like: “How strong is my brand versus my competitors’ brands?” and “How much more will customers pay for a similar product from this brand compared to that brand?” I saw a couple of articles today (you can get to them here and here) that basically argue the answer to the first question is, “It doesn’t matter” and the answer to the second question is, “$0.” They make the argument that the availability of information via social media and the Internet has deteriorated the importance of the brand to the point where brands are essentially meaningless. The argument goes that brands were important in an information poor environment. Since consumers couldn’t find out much about products, they relied on their perception of brands as proxies for quality, reliability, ease of use, etc. That world no longer exists. Consumers are now in an information rich environment where they can easily research products and services to see what people are saying about them. Therefore, if a company with the most valuable brand today (Apple) released a dog of a product, people would know it was inferior very quickly and it would fail – the fact that it was from Apple would not matter nearly as much as it had in the past. The authors also note that brand loyalty has deteriorated significantly over the past decade and attribute that decline to the fact that consumers can now evaluate alternative products much more easily.
If this is true, it makes conducting brand research pretty meaningless. Why bother to measure something that doesn’t impact consumers’ choices much? Obviously, we’re not to the point where I’d advocate ignoring brand image totally but these articles got me thinking that brands might indeed be less important today than previously.
I’d be interested in hearing your thoughts.