Benjamin: Before Paying More for the Brand Name

I won’t drink coffee unless it’s from Starbucks. They just make a better product.

Branding is very important in the retail business, because you can charge more per product and still outsell your competition. When I was a salesperson and making long drives in an unknown city, I would always stop by a Starbucks whenever I’m tired. It’s not that I thought the coffee was a notch above the rest either. It was just that the experience was consistent and predictable. I knew the setting, I knew what I wanted, how much it would cost and the product that I was getting.

If I went to local coffee shops, the predictability stops. Do they sell ice coffees? Are credit cards accepted? Is it going to be too sweet? Sure, I can be adventurous, but I wasn’t in the right mood after a full day of meetings and driving. Is it worth the hassle when my main goal is to have good sales meetings? Not really.

Branding is an art-form that millions study. With careful and clever advertising, consumers can be lured into paying ridiculously high prices for a certain product that cost nothing to produce. Think of those t-shirts that cost 50 cents to make, or an pair of shoes that cost nothing more than a few dollars to produce.

As a consumer, brand name is expensive. Yet, many of us will gladly pay extra for it. Knowing when it’s worth it really comes down to personal choices, but before you shell out another dollar of your hard earn cash, think of these few factors before you give the cashier the chance to ask “credit or debit?”

Consumable vs Everlasting – Is the product everlasting (like a watch) or is it really just a consumable (like coffee)? Is it really worth paying twice as much to consume a product that will be forgotten in 45 minutes?
The Price Difference – Obviously, a $2 difference isn’t the same as $500, but do you actually know how much the alternatives cost?
Design and Value – Some products just lose value as time goes on. Fashion and gadgets come to mind. If this season’s color is purple and you are still buying clothes that are silver and gold, you are a little out-dated.
Importance to You – Some of you probably rolled your eyes when I talked about the color nonsense, while others will completely agree. Like I said, it’s all a personal choice, because different people value products differently. I couldn’t care less whether I’m wearing a red t-shirt or a blue sweater (I couldn’t even tell you what I’m currently wearing), but paying more for the latest iPhone versus the other version is important to me (if I was getting one). Know what’s important to you, and the decision becomes much more natural.

I Need More Help Deciding

Still stumped about whether you should pay more for it? Here are several ways to help you decide.

Bring an Expert – People who are really into fashion know that a Louis Vuitton hand bag is hand stitched and can last many years more than a regular no name brand. Other brands of clothing use high quality garment that also helps it last for years. Once you know the real differences, you can decide whether there’s value in the higher price tag.
Add Ignorance – Another trick is to bring someone who has no interest in the product you are considering. By not having the bias towards any brand, your friend can see quality with a much more objective eye.
Ask Around – Look for other people’s opinion about a product. Is it really all hype or is the higher price justified?

My New “No Name Brand” Sunglasses

I finally ordered my pair of new glasses because my glasses popped out again (this time, it happened while I was driving so that’s the end of waiting!). At first, I went to a store and the sales person kept pushing me high end spectacles. After looking around for a while, I tried on a pair that I really liked, and it happened to be 20% of what the other pairs cost. I was so happy. I forgot how pleasurable it was to find something I like at a price that’s much lower than expected.

It wasn’t a brand name, but it was just as nice, just as functional and best of all, it was much cheaper. Think carefully before you pay for another brand name.

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