elb's hovel of thoughts

Thursday, December 23, 2004

Marketing and branding

How do companies make their goods so desirable in the eyes of people? Why are some people willing to part with four digit figures (or high threes) (in ringgit) for a piece of clothing?

Via good marketing and with the help of the power of branding of course.

Taking shoes as an example: you can break down this segment into several: sports, technical, leisure, formal. Within each segment you can further break it down, say in this case technical shoes; which can be split into for example: running, and outdoor.

Well so you now have a product and want to target a specific area. In this case for example we have Asics; which has a reputation for having some of the best running shoes around. But it also has competition from brands such as New Balance and Puma. (Now, I'm not even counting brands such as Nike et cetera, which do make running shoes but not exactly recommended for proper outdoor jogging etc) Or for outdoors, where we have Timberland, Salomon et cetera.

Within each niche market, the company has to decide where the focus should be. For say, running shoes, how much focus should be done on comfort? On performance? On support? On the styling? Would the customer be willing to pay through their nose for the best combination of all variables? Or should the focus be on cheap shoes which don't give much performance, but look stylish? Etc. And the goods are marketed accordingly. And branding helps to give an edge. People who are more into sports would most likely buy Nike/Adidas/Puma, people who want the more technical shoes would most likely buy Asics, and for outdoors, well, Timberland probably wins the masses over. People who want good value for money for sports shoes would go for Power. (if you could even call it that)

The girls who aren't very well off would most probably go for Vincci. Those who could afford a bit more would go for Hush Puppies and so on, jumping up to the couture wagon all the way to Manolo Blahnik.

Same with clothes. You identify a segment of population you wish to target, then market your product accordingly. Can the people afford the clothes? How much are they willing to pay for couture? Can you make your product seem so exclusive and so priviledged that people would pay a bomb just to wear them? Usually this is done via the inclusion of high quality materials in the fabrication process; a very exclusive looking shop; and expensive looking price tags that reflect it. So you have cheap mass produced clothes at stores that go for a few ringgit each, to the more exclusive ones which might cost RM50 each, to RM100 and so on. In brand equivalents: your cheap no-brand stuff, to FOS/Reject Shop to Body Glove to Quiksilver to smaller local designers to the big haute coutures such as Moschino, Versace, Burberry, Dior and Prada

Then again, you have imitation Burberry stuff everywhere in Malaysia, so what's the point? Besides knowing that you have the real deal.

Well for me personally, I don't like to show off my stuff. I'm happy with a small label at the side and just knowing that I have it. Less trouble too.

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