Brands Create Customers

As brand builders we’re continually pushing the edge of innovation, creating customers in new markets, and increasingly across international boundaries. In this effort it helps to situate brands in the big picture of things, as a prime-time player on the global stage. What we need is a succinct formulation that defines the “macro” role of brands as an independent, proactive force in today’s world economy.

And I do mean succinct. Keep it short and sweet, so it packs a punch. Make it a big picture in 25 words or less, something that would also serve as a elevator pitch for the supreme importance of brands.

Moving brands to the top tier

This means raising brands to the top tier of economic movers and shakers, right alongside capitalism and business, the two global economic drivers. Brands currently exist in a world of capitalism and business, so that’s where I start. The goal is to wrap capitalism, business and brands into one integrated concept. In the formulation below, I give each element a global purpose, and then tie all three together in a common value logic, ascending from commodities to higher forms of value.

A big picture context for brands

We’re talking real big picture here, as seen from high earth orbit. What does “capitalism” do for mankind? What’s the role of “business” on the world stage? And how do “brands” complete the picture?

My formulation doesn’t pretend to be definitive (well, not at this point, anyway). It’s my working snapshot, a starting point to put brands in their proper perspective.

So here it is, in 25 words or less:

Notes

OK, let me explain the thinking behind this formulation. As you can see, there’s an upward progression of value from commodity to “life,” i.e., to the customer, with brands as the crowning/creative/human touch. And there’s also a progression from underlying system (capitalism) to active institution (business) to human agency (brand.) In a profound sense, brands complete capitalism, and they complete business. (Could brands exist beyond capitalism and business? Of course.)

Capitalism

I mean free-market capitalism as an economic system, in the textbook sense. The main reason to keep capitalism around (with its endless imperfections) is that it does create commodities, and commodities (eventually) make us all richer by lowering the price of goods. Worldwide, this does seem to be the case. Put a bunch of capitalists in a room and commodities will burst out like popcorn.

Can capitalism be made more open, more responsible and more equitable? Absolutely. That would also make for better brands.

Business

Business uses commodities to create value: iron ore into sheet steel into cars, knockdown furniture at Ikea, H&M, Gap and the clothing chains that run on cotton, digital devices with cheap chips, a grass-roots bank in India using open source software. The more commodities available, the more forms of value that business can create. (Commodities fuel business opportunities.)

Business, though, typically thinks first about profit, not advancing customers. And that’s where brands come in. A business can make a sale, but only a brand can create and grow a customer.

Brands

I mean value-based brands, not brands developed as stylized sales stimulants. In my formulation, brands are avenues of innovation that invent new forms of value beyond the product proper. They do this by integrating the mission of the company and the product with the mission of the customer. Brands “bring business value to life” by transforming it into rich human context. Indeed, this is how brands create customers.

A side benefit of this formulation is that it makes brands the greatest place to be if you want to combine human values, creativity and business innovation. But then, you already knew that.

Comments, please

By all means, please let me know of any comments, suggestions or revisions you might have to make this formulation better. Or create one of your own. We are inventing a new world of brands. It’s the collaborative task of many.

And yes, I’m quite aware that most existing brands would fail this big picture test.

This entry was posted on Wednesday, October 4th, 2006 at 12:10 pm and is filed under Fundamentals. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.