Reputation + No surprises = Big Profits

Thursday, May 22, 2014 Francisco Carneiro 0 Comments

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Nothing new here, if you can build a reputation people with do business with you without extensive due diligence & comparison with the competition. If you have a good marketing person build a reputation and don't disappoint the customer.

A good reputation & a good execution without surprises is enough to make a lot of money.

To build a good reputation is the difficult part.

Suppliers and especially manufacturers have market power because they have information about a product or a service that the customer does not and cannot have, and does not need if he can trust the brand. This explains the profitability of brands.

Peter Drucker

The ‘power’ of brands has grown substantially since the recession, that is, more consumers are purchasing solely based on the brand,” says Mr Walshe. “There really is something different about this top 100.”

Mr Walshe points out that those joining the list for the first time – such as Twitter and PayPal – have more than two-and-a-half times the ‘brand power’ of an average company. “Newcomers are really playing the branding game,” he says.

“One of the themes is that these brands are becoming part of our lives,” says Elspeth Cheung, head of BrandZ valuation at Millward Brown Optimor. “The other big theme is globalisation as western brands are coming back this year.”
Despite the new entrants, the names at the top are familiar. Technology companies dominate the top 10, although their order in terms of brand value has shifted.
Google has bounced back as the most valuable global brand, with a brand value of $159bn, up 40 per cent since 2013. Google held the number one slot from 2007 until 2010, but fell to second or third place in the years since 2010.
Apple, in turn, has slipped down to second place. Its brand value of $148bn has fallen by a fifth over the year, while the brand value of the technology sector as a whole has grown by 16 per cent. “Different brands have different strengths,” says Ms Cheung. “Google performs particularly highly on being meaningful to consumers.”
She argues that the more powerful a brand a company has, the greater a premium it can charge for the same product compared with competitors.

From FT
http://www.ft.com/intl/cms/s/2/d8ea4e6e-da79-11e3-a448-00144feabdc0.html#axzz32Qu3tbAR

More on the same subject

http://thoughtmeme.blogspot.pt/2013/10/put-marketing-people-in-charge.html

http://thoughtmeme.blogspot.pt/2013/10/something-unique.html