Why and Under What Conditions Are People More Likely to Buy Brand Names Rather Than Their Generic Counterparts?

People reward those who try harder

Brands have been with us for decades, so it is true that no human being alive was born when no branding of some type existed. This feature of the modern man’s life is normally not taken into account because it is perceived as something normal and embedded in the daily landscape. As mass production and high consumption invaded the society, the noise generated by multiple advertisers in order to promote their brands on TV and other media reached a level by which an average consumer is no longer in position to pay attention to a great variety of new products. The advocates of new ways of marketing have mentioned this fact, like Al Ries and Jack Trout, Stan Rapp and Tom Collins. From their research it is understood now that people is more likely to buy brand names that have a positive and unique position in their minds, due to the communication strategy utilized in the marketing campaign, and because the company behind the brand is able to dialogue and interact with the consumer in a way that adds value to the product, under the consumer terms.

Brands (and the companies behind them) that are able to grab a portion of the consumers mind and delight them have a good chance to appeal to buyers at the moment of purchase, which is only one of many different moments of truth. This phrase, created by Scandinavian Airlines CEO Jan Carlson, defines the opportunity a company has to influence the customer’s perception of the value of the service or product received. What we see nowadays as a powerful trend in marketing strategy for the big and not so big corporations is an integration of the classical consumer marketing paraphernalia and all of its sub-categories (industrial, technological, corporate, etc.) with the strategies of customer relationship management (CRM), including lines of thought and techniques such as one-to-one marketing, relationship marketing, loyalty programs, interactive relationship management, permission marketing, database marketing, direct marketing, churn reduction and so on.

The well-known rules of classical marketing define the existence of a package good, sitting down in an aisle of a supermarket. The type of package, the material of which is made, the font of the letters of the brand name and the color of the label, the size of the servings and the information and instructions contained in the physical entity abide by codes and regulations from the industry, as well as results from marketing research. Everything in the product itself and the accompanying point-of-sale advertising material work together to support a positioning for the product. The toll free number or web site address provided in the label contribute to the positioning as well, but their primary function is to provide means by which the consumer can interact with the company behind the brand and vice versa.

In fact, as mentioned by several CRM enthusiasts, like Dick Lee, Jim Novo, Don Peppers and Martha Rogers, a company has to encourage a buyer to repeat the purchase by means of the analysis of its behavior. For this purpose, the feedback provided by the customer itself via satisfaction surveys, face-to-face, web and phone interactions and the features of the transaction itself is a great piece of information to assure the continuous preference for a certain brand name.

According to this thought, a brand that delights a buyer will be preferred as a first choice. It means that the whole product or enhanced product fulfills the customer needs by anticipating them. And this is only possible with a great deal of data-mining endeavor, if we take for granted that every average company intends to perform a minimum marketing effort, but not all of them have the mindset and the funds to start to abide by the CRM strategies. A plethora of commercial programs with sophisticated algorithms do the job for the marketing departments of the companies that die to know their customers’ needs and wishes. But it is not only a matter of getting the funds to buy software and have the IT people to install it. The implantation of a CRM strategy in a company starts at the top, with the CEO, CFO and similar high rank people to buy in the strategy and the necessary re-engineering of the work processes, in order to have all of the moments of truth offering the customers a positive image of the brand and the company behind, showing to the world the edge that allows it to prevail over the rest of the competitors and that offers value to the customer in its own terms.

Wouldn’t it be great to have a world-class after-sales service? If a satisfied PDA user lets it fall to the ground and has to replace it, and he knows that he can do it by means of a mere telephone call, or by e-mail or thru a web page, it is likely that whenever an upgrade or a new model is available,