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Industry research is a wonderful thing, isn't it? Someone likely paid a tidy sum to Yesawich, Pepperdine, Brown & Russell to learn the following:
Okay. Not particularly ground-breaking there... In case anyone didn't know that people with money tend to be the ones that populate first-class, we now have a statement in writing saying so. Perhaps more interesting is their finding that people with money pay more attention to branding than people without money. This seems somewhat self-evident to us as well. People with money can afford to pay attention to branding. Those without money have to settle for whatever low-priced crud is available. This links in with something I lecture about. During my speeches I often talk about price and branding - and the fact that having a strategy of having the lowest pricing is one of the least defensible brand positions. It also makes your brand look like every other price cutter on the market. Lowering your prices is not branding. Lowering your prices is a sale - and you can't have a brand that is all about continually making your prices lower. At some point you cease to make money. As for the power of brands... according to the survey, affluent travelers enjoy the Hyatt Regency, Park Hyatt and Ritz Carlton for their stays while the budget crowd showed affinity for Marriott and Holiday Inn. I have to wonder if YPB&R actually thinks that this means that the budget crowd would still stay in the cheap places if they had money. I'm thinking that the budget crowd probably doesn't want the basics, but they can't justify anything more. I don't know anyone who would forgo a first-class seat (assuming the rest of their party went with them) if offered for the same price as coach. Brand matters to just about everyone - but some people can't afford to use the brands they want. Don't think brand matters to you? What if I give you the choice of wearing a shirt made by a local artisan versus one that is made by a sweat-shop in a third-world country. And the latter one also funds terrorism. And they kill cats. And... they want to raise your taxes. And... more bad stuff. At some point you must realize that a brand is affected by everything the company does. It doesn't matter whether you're poor or not - just some people can't afford not to do business with companies that have lousy brands. Let's look at this a little differently. If I'm trying to create a brand that appeals to people that are looking for the lowest cost then I'm throwing away business from people looking to create a lasting relationship with me. Does anyone actually think that people who shop on price alone are likely stop shopping on price once they find your business? When a business no longer has the lowest price the business is no longer favored and the penny pinchers go elsewhere. You don't see dollar stores converting to two-dollar stores, do you? So... knock it off with the whole "my brand is about having the lowest price" approach. Even if it is only partially related to the survey, both Stokefire and YBP&R can show you (in very different ways) that it just doesn't have much hope of being profitable. Wow... that's a whole lot of rambling for what was supposed to be a one-liner response to an apparently pointless survey. Tate Linden |
