How Do Brands Work?

The Pepsi Challenge demonstrated the remarkable power of a brand: Coke's. It turns out there was even more to this story than we first thought.

        For years, advocates of branding have battled the Empiricists, the group that insists that unless they can explain something, it doesn't exist.
        I can discuss the The Empiricists with affection. I was one until the mid-1980s. Brands could not matter, I thought, because they are too intangible, amorphous, and illogical.
        Then came a series of conversion events.
       First, the Pepsi Challenge. These commercials demonstrated that people preferred Pepsi to Coke by a significant margin.  Pepsi's, however, was that people's preference did not matter. They still bought Coke.
        Then Coke decided that Pepsi was right: Pepsi did taste better. What if we make our Coke taste better? Wouldn't we increase our market share?
        The answer, of course, was a fiasco: New Coke. Taste testers loved it. But in real life, people did not just prefer Old Coke. They demanded it.
        The story doesn't end there. Recently, Read Montague, the Director of the Human Neuroimaging Lab at Baylor College of Medicine, decided to repeat the Pepsi Challenge , but with a twist.
        Montague performed the challenge while scanning the brain activity of the tasters. Once again, more tasters preferred Pepsi. Their ventral putamens, one of the brain's reward centers, especially loved Pepsi; they responded five times stronger than the ventral putamens of Coke lovers.
        Then Montague added another twist.
        He told the subjects which brands they were tasting. What happened?  The subjects overwhelmingly preferred Coke. And their brains acted differently, too. Their medial prefrontal cortexes, the portion of our brains strongly involved in our sense of self, fired at intense rates. Coke, it appears, strongly links to our sense of self. Not Coke the taste, but Coke the very idea: Coke the brand.
       It's not just people's taste buds that like Coke.  It's their brains.
        This discovery did not surprise people who had been involved in the testing of hair restoration products. In controlled tests, 40 percent of Group A reported that Extra Strength Rogaine had produced for  them  "significant hair gain." . Group B had even better luck with 60 percent reporting hair gain. But Group A had not been given a hair restoration product. They were a control group! They 'd been handed a vial of oil and water.
        Yet they saw hair! The brand name attached to their vial convinced them that it would grow hair, and so it did.
        Even though it didn't.
        Even before the Pepsi Challenge, an earlier commercial that should have quieted the Empiricists. Those classic spots for Folgers freeze-dried coffee took television viewers to famous American restaurants, where an on-screen announcer said that we were in a famous restaurant --Tavern on the Green, for one example, and that the diners had just finished their coffee.
        "And what they don't know," the announcer told us, "is that the coffee they've been drinking. . .is Folgers Crystals." The announcer then asked the diner what she thought of her coffee.
        "Fabulous," she said, as did the men and women in other famous restaurants across the country. Freeze-dried coffee is fabulous? Not now, not then, not ever.  But the coffee tasted fabulous, of course, because it was from Tavern on the Green. The Tavern on the Green must serve great coffee; it certainly delights the medial prefontal cortexes.
        And so freeze-dried coffee tasted great--even though it didn't.
        Even the Empiricists must realize this now: Brands do not just attract people. They change how they think -- and feel.
        How is your brand doing?

"At branding, Beckwith Partners are the masters."
          Richard Cresta
          Sr. V.P., Marketing



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