Nike, Disney, Coca Cola, Apple, and Sony all have one thing in common. They have built iconic brands that have become recognizable world-wide. Growing up we've been surrounded by brands and they have shaped the way we go about our days, our consumption habits, and our opinions on the best products and services we choose to use. There is an emotional aspect that makes up how we view brands in the present and even more in the future.
So how are brands developed and why are they so important? We live in a global economy where barriers to entry are at historic lows proving that branding is one of the only ways that companies can differentiate from their competitors. Millennials are more demanding of brands that are conscious and aligned with their personal political viewpoints and interests. Statements about donating towards causes or taking steps to become more environmentally conscience goes a long way with consumers today.
An example of how a company is trying to establish brand strength is Chipotle, a food brand, that has built a loyal following even with controversial health issues in the past. Chipotle is focused on providing quality fast casual food, but recently they launched a clothing line, because they understand that this will help strengthen their the loyal customers. By building a brand a business is able to take up more mindshare of people that will use the product/ service more often.
So, there is a shift from Stakeholder capitalism to Shareholder capitalism because investors don't have the same influence over businesses like they once did. The customer now has more power over a businesses focus and approach in what they create and whether they operate in a environmentally conscious way. Social Media has been a catalyst for how consumers have more power in what products perform well. Consumers are realizing that a purchase for product X is a economic vote towards X and by purchasing certain goods and ignoring others they are able to influence brands from their buying patterns.
In the end, branding can make or break a company. It takes decades to build a brand and only one big mistake to cripple a business. Next time your buy new clothes or shop online, remember, your choices actually have a direct impact on how companies are conducting business and you have the ability to influence businesses to align more with what matters to you.
Check out our new brand website and the exciting content that we are bringing every week on THC.
News [00:00:03] Facebook is getting a refresh, the social media giant unveiled a new logo with new colors to indicate that Facebook also owns WhatsApp and Instagram. The rebrand comes amid calls for transparency and a probe by the Federal Trade Commission.
Jed Tabernero [00:00:15] Brands are changing either as a direct result of public outrage or as a measure to align values with consumers. Think about how General Motors communicated going electric.
News [00:00:29] The carmaker pulling the wraps off its new logo today. It's part of a marketing campaign that focuses on electric vehicles. It is revolutionary how it's changed grass.
Jed Tabernero [00:00:37] I'm joking. They have to move towards towards the side. They have to change. It can't be your dad's or our grandfather's automobile company. These marketing campaigns represent how the brand wants to evolve. Your brand is so important. It represents a company's mission.
News [00:01:02] Now, Apple, fortunately, is one of the half a dozen best blamed for right up there with Nike, Disney, Coke, Sony, it is one of the greats of the greats, not just in this country, but all around the globe. Apple at the core, its core value is that we believe that people with passion can change the world. For those people who are crazy enough to think they can change the world are the ones that actually.
Jed Tabernero [00:01:35] Stick around to learn more about why brands are changing and why your buying patterns can actually affect change.
News [00:01:44] A lot of things have changed the values and core values, those things shouldn't change.
Jed Tabernero [00:02:01] Welcome to THC, where we unpack the ever changing technology economy hangout with Jed Shikher and Adrian as we tackle the industries of tomorrow.
Shikher Bhandary [00:02:13] This is things have changed. Everyone knows what a brand is, right? It's probably some logos, the logo of your company. Different kind of colors that you have on it, the font, the typeface, whatever you have when you throw out ads and. Stuff in social media. What are brands for?
Jed Tabernero [00:02:43] We can think about a couple of these cases, right? A lot of industries, it has a very low barrier to entry. And, you know, it's easy to get in there and it's easy to create a similar product. So you can't differentiate based on product. Some people have to use brands as a way to differentiate. Right. What is, for example, a really famous example for brands is Coke. Pepsi, bro. It's Coke. Hang on. What if it works better? Trust me. Watches it works better. So what is a Coke bottle without the Coke logo? It's just it's just Culebra. It's just got to see how that works.
Shikher Bhandary [00:03:23] That doesn't work. OK, but cola. No, no, no. Let me tell you what how I was going to phrase it. Pepsi. When I grew up in India, Pepsi was just not cola. Pepsi was me trying to be like the David Beckham, the Ronaldinho and the cricket team, because all the ads were that it was cool ads where I was like, wow, this is it. You know, like it was always just the way I grew up. I used to play football, cricket, and after the session we just go and drink Pepsi because that was.
Jed Tabernero [00:03:56] Let me ask you this. Let me ask you this. Do you know what the difference is between Coke and Pepsi?
Shikher Bhandary [00:04:02] I think coca sweeter. Shut the fuck up. But I'm not I'm not I'm not drug either in like yours, though.
Jed Tabernero [00:04:13] OK, well, you know that, so
Shikher Bhandary [00:04:16] I've forgotten how they taste, basically.
Jed Tabernero [00:04:18] That's the thing. So, you know, growing up, I never knew the damn difference. It's just you chose Coke or Pepsi if you believed in a certain thing. Yeah. Yeah.
Shikher Bhandary [00:04:27] Brand allegiance to anyone tells me coke. Exactly. I'm like I'm already like this guy. Who the hell is this exactly?
Jed Tabernero [00:04:33] The main point is that, you know, Brand is super powerful. That shows you how Brand is super powerful. Right. A lot of cola brands could have been formed. It's not like there's anything super unique in somebody's formula. You know, like, for example, how much is Ralph Lauren Polo shirt versus just a normal polo shirt serves the same purpose. But Ralph Lauren can can charge a premium because of its brand. Right. And who knows where half that shirt is made. Right. So it's kind of interesting. But, you know, what are brands for that question you ask and and I read something, an article from The Economist that was trying to say that brands are to be able brands are made to be able to establish loyalty beyond reason that everybody can remember a certain brand.
Shikher Bhandary [00:05:19] You can count the economists to give like an iconic line and just drop it and just random articles.
Jed Tabernero [00:05:25] But, you know, within this article, they talk about the concept of of brand strength. Right. How companies have been trying to establish like brand strength. That's a marketing agencies, advertising agencies are trying to accomplish. Right. And what they say is that, you know, brand strength is made up of loyalty, plus emotional connection, as we were just talking about. Right. Pepsi and Coke. We both have an emotional connection to that. You know, it reminded you of trying to become messy. It reminded you of becoming great, all those commercials with friggin
Shikher Bhandary [00:05:55] runout or out of all the sectors,
Jed Tabernero [00:05:58] all of that has has established connection with you. So you have this type of loyalty when you were consuming the product to to you know, if you're not a soft drink fan, you grew up in this age. That's something similar to Apple, right? There's people who frickin love Apple, regardless of how many features it misses. Right.
Shikher Bhandary [00:06:18] Or if you saw the latest, you saw the latest air tags. It's a button with a GPS. And so that you can just carry around and you can attach to your keys and your bags and now you can track everything. And it's like
Jed Tabernero [00:06:30] whatever it is, it's been out for at least ten years, that that's acceptable.
Shikher Bhandary [00:06:34] So just the difference because it's Apple, you want it because that button Apple logo. Means something to people.
Jed Tabernero [00:06:47] Exactly, and that's brand strength
Shikher Bhandary [00:06:50] brand today is more than just the logo, the font, the typeface, the ads that they put out, it is what the consumers think when they see the name of the company. So it's every interaction, the experiences that they have had. What differentiates that product was something else. It's all of that combined and that's the brand. So you can think of a company less about the product and more about the brand and community that they're trying to build. You know, your man shaped Dollar Shave Club, Harry, is going against Gillette. All your you know, the drinks that you are literally drinking right now, kombucha and all these new drinks coming up next year.
Jed Tabernero [00:07:34] Did you but also, you know, the Seltzer's. That was ridiculous. EBD Yeah. Truly, you know, you had WHITECLOUD Oh my gosh. The ads for that ridiculous.
Shikher Bhandary [00:07:44] There's never been more competition in these industries and it's never been easier to build a following that will just stick to your product.
Jed Tabernero [00:07:52] And so, you know, we've talked kind of about what brand strength is and what our brands are. What is the current state of brands right now? What do they have to be? So we've seen brands evolve over these past few decades. Like what is so interesting? What is the interesting change that's happening to brands in light of the covid-19 of
Shikher Bhandary [00:08:14] businesses and companies have to serve your stakeholders, the consumers, your environment, everyone who interfaces your product, and not just the folks that own your shares. Right. So it's more like a stakeholder capitalism versus shareholder capitalism. So and that's becoming more and more the team. And it's something that's happening with multinational companies as well. With the pandemic, you know, a lot has changed. Company brands have changed. Things have changed, company brands have changed like crazy, like, you know, it's a great reset that companies see, like, OK, this big thing has happened. Let's come out of it, as you know, as a better brand, more authentic brand, a brand that consumers can connect with. So one big example was GM like on their earnings call, they just said, hey, we're coming up with a new logo and it's going to be GM. It's going to be sleeker and it's going to be in a blue, blue kind of color. And what does the blue stand for? Well, the blue stands for and in air quotes the clear skies of zero emissions future. That's basically I mean, it sounds corny, but like. They want to show that they are doing something to evolve to where the auto industry is going to be and they are pivoting towards electric vehicles.
Jed Tabernero [00:09:47] That's crazy, dude. I mean, did you hear about that April Fool's joke from Volkswagen?
Shikher Bhandary [00:09:53] Was it April Fool's? I thought they're going to change it.
Jed Tabernero [00:09:56] Well, no, that's actually not going to happen, bro. It was it was just a publicity stunt to get people talking about their new product. Right. But it was kind of crazy to think, you know, when they put out obviously, I feel like everybody knew this already, but it came out on April April Fools, where Volkswagen is changing its name. So Volkswagen
Shikher Bhandary [00:10:16] right. Where Volt like the electric. Yeah. Yeah, correct. Electricity.
Jed Tabernero [00:10:21] Yeah. And it it's kind of crazy because it's cool.
Shikher Bhandary [00:10:26] I'd be down for that dude.
Jed Tabernero [00:10:28] I mean it would be, it would be crazy. Right.
Shikher Bhandary [00:10:30] But because if you think Volkswagen is people's car and so Volkswagen means electric car, you know, so I think it still works.
Jed Tabernero [00:10:42] It's kind of cool. It's kind of cool the way you think about it. But, you know, CEO came out with a press release saying, hey, we're not there's no name change of the company. We're going to create electric vehicles. But, you know, we're not going to shy away from creating the best vehicles for people. You know, they're still maintaining their brand. But it just shows you how, like electric has become a huge part of the agenda for even legacy car companies. That's ridiculous, right? So brand changes can signify a change in direction, right. Massive changes in direction.
Shikher Bhandary [00:11:16] Yeah. And one big one that that really stuck out was Pfizer. Pfizer changed its logo to like this double helix, kind of like a DNA color logo. And it makes sense, right? I mean, pre pandemic, Pfizer was just part of Big Pharma. And with the pandemic and then Pfizer being, you know, one of the best vaccines out there, they are leaning into that where they're like, OK, now let's change it up, because now we believe in breakthrough stuff and helping people. So they are it's a way for them to show that they believe in the breakthroughs and helping people for the common good. Right. So it's interesting. Yeah. Let's see how that works. But I mean, whatever they're doing with the distribution and manufacturing of the vaccines has been just really good. So, I mean, they get a pass, I guess, for a bit. But let's let's revisit after the pandemic. So companies are changing brand. So why now, though? Right. We spoke about the pandemic. Is there any specific reason other than the pandemic? I mean, is it just the consumers?
Jed Tabernero [00:12:22] Well, you know, we have to think about what you had mentioned earlier, which was the shift of the form of capitalism that we live in. Right. So we're thinking about a shift from a stockholder capitalism approach where it's all about the people who own the stock. Right. And public companies especially. It's all about them. It's all about their interests were shifting from that to stakeholder, where it involves the consumer, it involves the employees. It's a it's a totally different form of capitalism. Right. And what that means is that now the interests of the consumers, the interests of the employees who work for that company are starting to become increasingly more important. You know, so it's becoming a place and where they are subject to our values, these companies are subject to our values. If we care about a certain thing, we will speak out about it on social media and the companies will have to fuckin respond. Yeah, that's just how it goes nowadays. And the consumers are becoming more powerful. We have a voice now.
Shikher Bhandary [00:13:28] Yeah. And do. Consumers. Finally, have a say. With regards to what product they want to use and they have a choice, they can jump to another product. So you're seeing a lot of the the the values of, hey, you guys need to be transparent. There's a demand, increased demand for authenticity, desire to be more in tune with what's happening in societies with injustices, racial inequalities, gender inequalities, all of that. Your businesses have to cater to all of that. So the younger generations are really moving the needle with regards to choosing what they want to be the brands of the future. Right. And one thing always comes in mind for me specifically, like I'm a big Chipotle fan. I call it a portal portal, but then absolutely nailed the messaging and branding. They nail it because, you know, I. When I sign up, they send me a monthly report of everything that they have done to uplift the societies, everything from, you know, food, how much food they're buying from organic sources, how much investments they have put into local farmers and young farmers and sustainable products. They talk about people all that they have done for people to get into the hospitality industry and, you know, providing loans and and donations, fundraisers for restaurants through this pandemic environment. Like I touched on it briefly. They recently came out with, like a landmark statement that they are 51 percent waste free. The whole organization is 51 percent risk free. How do they even get that? Well, like, they take serious measures to make sure they follow recycling, composting, waste to energy. They have that whole program set up to make sure that they are achieving their goals. And it's always, how can we do better? How can we do better? So much so they've created this brand, the sustainable brand. And, you know, they're using the avocado seeds as a natural dye in the shots that they sell. And now they're a clothing brand as well, which looks pretty sick, like, if you will, will have the link in the bio. But like, you check it out and you if it wasn't a Chipotle website, you'd think it was a Lulu or an Adidas product, because they know people are fanatic about their brand and what they mean and are willing to wear their products and not just eat it, but I mean, they are killing it with this whole brand. Their stock has significantly outperformed the market. Right. And there is a there is a big correlation over you where powerful brands. This is a McKinsey report, but powerful brands significantly outperformed the market over. I guess over the last 20 years, they have almost doubled what the powerful brands if you take the top 50 powerful brands, that basket has doubled the. Just standalone market, right, isn't that crazy? I mean, it shows that, you know, if you believe in a product, you will come back, right?
Jed Tabernero [00:16:54] I mean, the same reason. You know what? Like you have this affinity with Chipotle. I have the same with Tesla, bro. Even before I I bought Tesla products, like I was just really into the whole Tesla mission, you know, especially like being in college, being this impressionable child. Like, I loved seeing the Elon Musk dude. We're talking being a caterpillar, talking about, you know, the mission to to get to space, the mission to sustainability, like all this crap that he had posted stuff about on the Tesla website and the way they would, you know, have these these meetings where Elon Musk would just go fucking off the rails and say some dumb shit, you know, like and still would do well, you know, and that culminated to the moment I bought it, Tesla to become way more intimate and powerful to me, you know what I mean? Like, it's not just like somebody going out to buy a car. I've been a part of Tesla blogs and Tesla Facebook groups since fucking 2005 or some shit. Right. And that time when Facebook was coming up, one of the reasons why I signed up for Facebook was for Tesla Group. Like literally I wanted to be part of that community.
Shikher Bhandary [00:18:10] Are you one of those who are like, hey, welcome to thanks for joining this group. We are independent part thought provoking individuals on this group?
Jed Tabernero [00:18:20] Not at all. It was actually a it was actually a a group for solving problems, common problems for Tesla owners.
Shikher Bhandary [00:18:27] You didn't have it back then. So, you know, just what were you doing on it?
Jed Tabernero [00:18:31] I was literally on it to see what people's problems were like because I knew I was going to fucking buy a Tesla in like ten years. What I was thinking about this whole
Shikher Bhandary [00:18:38] time, that is. So that's the brand right there.
Jed Tabernero [00:18:41] That is a brand. Right. So I loved it so much that that buying experience for me was like, I need to have this. But let me tell you what. Like, I didn't think Tesla was the most like. I didn't think it was the most amazing brand. In fact, I had one one condition right in my head. My condition was that Tesla needed to be led by somebody like Elon Musk. It needed to be this powerful leader because, dude, I didn't follow Tesla's news articles. And every time I see us on the news, I don't click on it. I click because Elon Musk is saying that shit. I live like I follow that guy's Twitter. Like, there is just so much that he is contributed to the message of the company. But the company is the brand of the company is Elon Musk.
Shikher Bhandary [00:19:24] Absolutely. And it's this new wave of authenticity. Who has the most belief in a product, the founder of that product itself. Right. So you're seeing this new wave of authentic branding, personal branding, where people who relate to a particular person, personality, famous person, will buy the products that they advertise because they know these guys are not just going to throw recommendations for everything, it's curated. They're not just throwing advertisements. They are being very selective on what they represent. And Musk is one of them, like jobs for Apple, Musk for Tesla. They live and breathe the company. So you kind of follow that. You know, they're being authentic and honest about the product and this wave that is happening even on social media. Right. We're one example is the Carly Genoa's cosmetics line, Kylie Cosmetics. She became a billionaire because people love her so much that she started a cosmetics line. They are willing to. By the cosmetics line. So it's become really powerful, this like personal branding in general.
Jed Tabernero [00:20:39] What is cooler than buying into a product that will help you save the world literally? Like that's just what they make you think, you know what I mean? Like the brands have this effect on you, this pure authenticity that Elon is actually trying to save the world. In fact, like when you think about what he's done. Right. This is just for personal branding. What he's done is that he's almost gone broke multiple times. It's been on the news. And what they try to put out is he almost went broke and still put in all his money into saving SpaceX, for example. Right. Like when you're buying a Tesla, you don't think about buying this because it's a great product. I'm buying this because motherfucker's trying to save the world, you know what I mean? Like, he's trying to build us an entire economy on space. So it's just it's a lot more powerful to have that that personal brand. And we have a choice now to be a part of that mission.
Shikher Bhandary [00:21:35] Right. And it shows that the the legacy automakers didn't believe in the stuff. The consumers wanted it. Elon made it cool. Elon made it marketable, make it made it personable that you were part of the mission to make it more greener world. And now everyone's changing their logos. So, you know, like consumers have so much say these days, they can change companies. They can dump companies if they want, if you're not catering to your audience or not mindful.
Jed Tabernero [00:22:10] And so, you know why? Why is this stuff important? Right. If you have if you haven't figured it out yet throughout this whole call is what we're trying to tell you is that you have a voice. It's pretty important these days to choose what kind of products you're supporting. Right. Like when you go into the grocery store and think about what kind of coffee, coffee beans I should buy or or what kind of coffee I should even get every frickin morning. Right. There is an impact into what you're doing. We can see that now. We can track that from what these companies are doing. Companies are becoming more transparent. You have a choice when you go in there and buy products to for what? To support for, you know, if you're getting Chipotle or if you're getting Jack-In-The-Box. Right. It's almost the same price, bro. Go, go with a premium product, you know what I mean? Like buy something that aligns with your values and your mission. Right. And that's how we can effect change with these companies because they care they're going to listen.
Shikher Bhandary [00:23:09] Yeah. To it. And on a final note, the sales for canned water, some just regular regular ice water in a metal camp has been roaring, soaring, whatever. What do you want to use? Because people want water, because people want bottled water without the plastic bottle. So they are buying aluminum cans with water in it. So there is this whole market. We we spoke about coke and stuff prior to this. Right. Coca still the biggest polluter on the planet as a business. And they need to get their act, I know they made a few purchases into the space to do kind of leave it to at least represent a bit more with sustainability and stuff. And they need to rapidly move because consumers can choose.
Jed Tabernero [00:24:01] I'm sure you've had this conversation in the past where, you know, somebody in your friend group goes like, well, will my purchase, you know, change the way things are going? It's so terrible already. Like, how do I know this is going to make a change? Like, you can see it now, you can see it that that your choices actually have a direct impact into how companies are conducting business. That's completely changing. They care.
Shikher Bhandary [00:24:24] Consumers have the choice and they're willing to pay for cleaner, more sustainable, more authentic products. Hey, thanks so much for listening to our show this week. You could subscribe to us. And if you're feeling generous, well, you could even leave us a review. Trust me, it goes a long, long way. You could also follow THC, ATSI, underscore pod on Twitter and LinkedIn. This is things have changed.