Just the other day I read a statement by David Hughes, director of e-commerce at Marks & Spencer: „..the customer trusts the reviews more than the brand.“ Wow what a statement if you think about it. But what does that mean for brands? Are they becoming less important?
Brands usually serve as lighthouses. In the jungle of oversupply, businesses have to invest greatly into marketing and branding in order to make their products stand out from the rest. Usually it was like this: if your brand was not strong enough your quality was sometimes of no importance to the affluent consumer. The price tag provided the orientation. High price equals high quality. Low price must be low quality. Although strong trade brands by Aldi, WalMart, etc proved the opposite this was still a truism for many consumers.
Social media now further changes the game. A cheap DVD player may get better and more user reviews than the expensive alternative. Thus there seem to be new opportunities for economic brands: if their quality is convincing, their product features meet the consumer’s expectation and the consumer really has the impression to have made a good deal you are all set to be successful. This list sound familiar? Indeed: these are the ingredients for strong word-of-mouth. Why talk about a 200 dollar dvd player that is none the better than any other model? But if there is one model out there that offers the same features and decent quality for 100 dollars – that is something your friends might be interested in.
In the overall look, this is one manifestation of the new democracy provided by social media. You brands out there better prepare! You can no longer hide behind your brand image! Bad quality will be unveiled faster than you think with more reach than you might expect.