Advantages of a brand for consumers AND companies
Definition of a brand, Types of Consumer Risks
name, term, sign, symbol, or design, or a combination of them, intended to
identify the goods and services of one seller or group of sellers and to differentiate them
from those of competition.
Two most important parts of what a brand is:
Types of Consumer Risks:
Functional, Physical, Financial, Social, Psychological, and
Time (Definitions below)
: Consumer Advantages for Brands
Identification of source of product
allows consumers to…
Assign(ment of) responsibility
Search Cost Reducer: If consumers recognize a band and have some knowledge about it,
then they do not have to engage in a lot of additional thought or processing of
information to make a product decision.
Lower Internal Cost: how much they have to think
Lower External Cost: How much they have to look around
Promise from Product Maker: The meaning imbued in brands can be quite profound,
allowing us to think of the relationship between a brand and the consumer as a type of
bond or pact.
Consumers offer their trust and loyalty because of an understanding that the brand
will offer consistent utility and product performance.
Symbolic Device: Allowing a consumer to project their self-image. Some products are
associated with certain types of people, and by using them consumers can communicate
with other consumers and themselves the kind of person they are or want to be.
Signal of Quality: Given the difficulty of assessing and interpreting product attributes and
benefits for experience and credence goods, brands may be particularly important signals
Search Goods: like grocery produce, consumers can evaluate product attributes
like sturdiness, size, color, style, design, weight, and ingredient composition by
Experience Goods: like automobile tires, cannot be assessed so easily by
inspection, and actual product trial and experience is necessary to judge
durability, service quality, safety, and ease of handling or use.
Credence Goods: like insurance coverage, consumers may rarely learn product
Risk Reducer: Brands can reduce the risk in product decisions.
Consumers may perceive many different types of risks in buying and consuming a
Functional Risk: The product does not perform up to expectations.
Physical Risk: The product poses a threat to the physical well-being or
healthy of the user or others.
Financial Risk: The product is not worth the price paid.
Social Risk: The product results in embarrassment from others.