As the differences get smaller, the purely functional reasons for premium goods fade away, and instead they are purchased for the reason we’ve always purchased luxury goods: because of how they make us feel, not because of what they actually do. The fur coat is not warmer than the down jacket, it’s merely harder to acquire.
That’s a snippet from a recent post by Seth Godin.
There’s a lot of truth to this. And it’s for this reason—people purchasing based on feelings rather than for function alone—that brand identity and marketing are such important factors in business. How a brand resonates with its would-be customers is just as important as the goods and services it offers.
Recollecting my two most recent posts about SAAB automobiles, I stated that despite its failures, I still have a great appreciation for SAAB cars. That’s because to me SAAB successfully created a positive impression. In its early years, SAAB also maintained an air of intrigue; a feeling of, “Yeah, other car manufacturers do it this way; we’re going to do it differently.” A lot of head-scratching mechanics can attest to that. Better or not, it was different; and that brings a lot of appeal.
Feelings have to have a foundation. Some foundations are built on how things look; some on how things work; some on how you’re able to live now that you have the item—or a combination of all of these things. People have different criteria that they use to sift through what they buy and don’t buy. You can accomplish about the same with a Windows OS as you can with an Apple OS. You just go about it in a different way. But the difference in experience creates a feeling that customers swear by.
Like Seth said; sure the down parka and the fur coat both keep the wearer warm just the same. But the fur coat offers a solution that the down parka can’t: the richer image associated with scarcity. To some this is unimportant; but to the one wearing the fur coat, it solved a particular problem.
So ultimately it’s the perceived worth of a thing—what it offers in addition to itself—that forms that feeling, bolsters it and drives purchasing decisions. That’s why brands aren’t just selling a product. As Seth accurately states, it’s not just what the thing does. Coffee to some is just burnt water with an energy boost. But take that black liquid and put it in a white mug on a table surrounded by friends and family with a crackling fire in the background—now you’ve got a feeling that connects people to the coffee more than the coffee could ever draw buyers to itself. While a company sells a product or a service, a brand is in the business of selling a feeling, an experience and a lifestyle.