For a time, everyone was arguing whether Fauvism perfume was worth the price.
Judging from the value of emotional blending, the essence of the core topic involved in this hot search is: Is it reasonable to draw the conclusion of "brand premium" by comparing the cost price with the market price?
This is a complex problem involving different system modules. The front end is consumers' willingness to pay, and the back end involves the value alliance of the supply chain.
Brands have existed since ancient times.
A noodle restaurant can open three in Chang' an; An inn can exist for hundreds of years. There is a brand prototype within a certain geographical scope. The Southern Dynasties' Book of the Later Han Dynasty records: "If a husband wants to do his thing well, he must first sharpen his tools, using Zhang Zhi's pen, Zuo Bo's paper and Chen Mo." These products named after people have basically possessed brand influence.
But the brand premium did not appear at that time.
Because the geographical scope that the brand can cover is too small, and the communication environment is backward, the crowd that the brand can reach is too small, and it can only accumulate value in the time dimension, but can't expand the scale horizontally. Without large-scale production, it is difficult to realize brand premium.
After the emergence of industrialization and globalization, a large number of unified production methods and global trade have solved this problem, from the difficulty of production to the breadth of sales.
The world commercial market has been innovated and modern brands have appeared.
At first, commodities flowed in a limited geographical area, and the industry competition was not fierce, so there was basically no demand for commodity protection. After the period of industrialization and globalization, the production capacity has been greatly improved, and a large number of similar and homogeneous commodities have appeared. Only then did producers and sellers begin to add signs to their goods to show their differences.
But under such circumstances, there is still no institutional guarantee, and everyone is caught in vicious competition. Trademark legal system was first established in western society. /kloc-At the beginning of the 9th century, France, Britain, the United States, Germany, Japan and other countries that first entered industrialization successively promulgated trademark protection laws. By the beginning of the 20th century, the modern brand with trademark as its core was not only guaranteed by law, but also became an important part of the modern commercial market.
With the emergence of modern brands, brand premium is the basis of its emergence.
In its marketing dictionary, the American Marketing Association defines the concept of "brand" as follows: a "name, term, logo, symbol or design, or a combination of the above elements, used to identify the goods and services of a manufacturer or a group of manufacturers to distinguish them from those of other competitors.
David da. Aaker, the father of modern brand marketing, believes that brand represents an intangible asset. Jean Nolkapfer, a French brand expert, pointed out that a brand is the most valuable asset of an enterprise. For the company to which the brand belongs, the brand itself represents a kind of legal property with wealth value except the goods it produces. This kind of property can affect the behavior of consumers, and in the process of its sale, it can ensure that its owner has a steady stream of income. This is the brand equity theory.
In addition to brand equity theory, there are three or four brand theories, such as brand image theory and brand relationship theory. No matter what kind of theory, it is acknowledged that the brand itself is valuable.
This is the origin and theoretical basis of brand premium.
However, this does not mean that Fauvism perfume can generate brand premium at the price of 14 times. Brand premium can not be achieved by putting a logo on the product.
According to David. Aaker's five-star asset model, a brand must have at least five dimensions of value to achieve a premium. These five dimensions are: popularity (knowledge about knowledge), cognition (knowledge about quality), brand association (knowledge about personality and value), loyalty (knowledge about price difference) and other proprietary assets (trademarks and patents).
If this model is condensed and put into contemporary commercial society, at least the following three elements should be realized:
In the field of science and technology, no brand dares to claim that its products are 100% produced by itself. Theoretically, all our current consumer technology products are "supply chain products". -is a collection of countless small brands, forming a final technology brands, reaching our hands.
In the early 1980s, Intel's main business was memory chips. At that time, they were struggling with the rapidly rising Japanese competitors. When IBM released its personal computer and became very popular, Andy Grove, then CEO of Intel, thought it was an excellent opportunity and decided to bet Intel's future on CPU. 1985, Intel's CPU“80386 "was released and integrated into IBM's personal computer, which is also commonly known as" 386 computer ". The "386 Computer" was a great success, bringing PC from 16 bit era to 32 bit era in one fell swoop.
However, this success did not make the public have a broader and deeper understanding of Intel, but made IBM famous. As one of the suppliers of components in integrated technology products (although it may be the most critical part), is it possible for Intel to establish its own brand premium?
1989, Intel tried to put 386 advertisements in newspapers in Denver, USA.
This is the prototype of the intel inside program. Dennis lee Carter, Intel's technical assistant who put forward this concept at that time, said, "We want the processor to occupy a more prominent position in the computer. She is extremely important but invisible. People don't know the existence of microprocessors and they don't know us. "
1990, Intel launched the "Intel Inside" program, which was first launched in the United States, Europe and Japan. According to this plan, as long as PC manufacturers purchase Intel's processors and display the "Intel Inside" logo on their computer products and product advertisements, Intel is willing to share the advertising cost of this computer product. With the influx of partners, more and more consumers began to see the logo of "Intel Inside" on various PC brand computer products. Moreover, in various PC brand advertisements on TV and radio, I heard the familiar phonetic symbols of "lights, lights, etc."
"Intel is at
The "edge" plan is rare, and it has achieved a dual-brand premium marketing plan for itself and its partners. It not only established its unique position as the king of PC processors in consumers' minds, but also established a strong willingness to make purchase decisions for cooperative PC brands.
This is excellent marketing, but it is essentially a patent monopoly behind Intel.
In Pinduoduo, there are a large number of "white-brand products"-that is, products that have been removed from the brand logo by major brand foundries. Generally, the price of "white brand products" is only half or even lower than that of big brands.
Why can't "white brand products" sell at the same price as big brands? Obviously, the functions of the products are all the same. Is it just a question of name and logo?
No, one of the key factors is that big brands have paid a lot of costs in brand building.
In essence, brands are the solvers of consumers' needs. It is the brand that understands the needs of consumers and explores a set of solutions (whether products or services)-the production supplier is only the executor of this demand. Before producing products, manufacturers and suppliers are separated from the consumer market, and they don't know who to sell the products to and how to sell them.
Therefore, from the beginning of the brand establishment, the brand always has to conduct market research, smash huge marketing advertising expenses and invest a lot of channel sales expenses. If the store is wired, there will be a lot of rent and labor costs. These various brand building costs need to be borne by the brand. And the risk cost that big brands have to pay for this-"white-brand products" can be closed and reopened at any time on the TV platform, but big brands can't afford such risks.
As the widely circulated hypothesis says: If Coca-Cola's factories all over the world are destroyed by a fire, all the factories can be regrouped on the ruins overnight as long as the brand is still there.
However, a hundred years ago, Coca-Cola's main selling point was functional:
Coca-cola-delicious and refreshing, quenching thirst and helping health.
Nowadays, Coca-Cola has become a way of life. No matter what this lifestyle is, Coca-Cola has become an important symbolic element of this lifestyle.
Brand has triple values: functional value-emotional value-symbolic value.
Every time a value is realized, its brand premium will go up a step. The final outcome is the most difficult to achieve.
Coca-Cola can realize this symbolic value, and one of the "key battles" is to go out with the US military during World War II.
During the second world war, the United States has been making a fortune in arms. It was not until Japan attacked Pearl Harbor that it declared war on Germany, Japan and Italy and joined the war. When the US military began to go abroad, Coca-Cola aimed at this opportunity and won the quota of "military supplies". Robert wood Woodruff, then president of Coca-Cola, declared: "No matter where our country's army is, no matter how much our company will spend, we must ensure that every American soldier can drink 1 bottle of Coca-Cola for only 5 cents!"
With the pace of the American war, Coca-Cola also "fought" around the world. At the same time, Coca-Cola began to construct unique lifestyle symbols for two types of people. Coca-cola is a symbol of home for American officers and men who participated in the war. No matter where in the world, drinking 1 bottle of Coca-Cola can provide a sense of security at home. For the people in the countries where the war took place, it is an "American dream" and a symbol of the lifestyle from the most powerful country on earth to drink Coca-Cola as a standard by the powerful US military.
When a product goes beyond its product value and emotional value and enters the spiritual world and life of consumers, its symbolic value has been established.
Judging from these three standards, it is self-evident whether Fauvism perfume can charge a brand premium of 14 times.
In order to realize the real brand premium, the above-mentioned brands need to accumulate input costs at the market and consumer level, which is only one of them, and determines whether the brand can obtain consumers' willingness to buy. There is also a very important factor: whether the brand can realize the value of supply chain.
At present, more than 90% brands are supply chain systems composed of brands, manufacturers, sellers and other roles.
In this supply chain system, brands do not participate in organizing production, but only put forward demand solutions based on their own brand influence (cost) accumulated in the market. Facing the uncertain market, they work out production plans with production suppliers, and then realize brand premium at a higher sales price.
According to the entrustment of the brand, the production supplier organizes and implements the production according to the technology required by the brand, so as to avoid the uncertain risks in the market and obtain stable income.
In this supply chain system, both sides take what they need, and the brand premium is actually the result of the joint efforts of both sides. As for how much it can "overflow", it depends not only on the brand momentum created by the brand on the consumer side, but also on the ability and willingness of the manufacturer.
Foxconn is willing to invest huge sums of money in technology research and development and upgrading for Apple's orders, but for a start-up mobile phone company, it will definitely charge a foundry fee higher than the market average.
Therefore, the supply chain is valuable and an important part of brand premium.
Although Fauvism and famous perfume are produced by the same foundry, the relationship between them is unknown.
Perhaps, behind the price that Fauvism is 0/4 times more expensive than famous products, its cost is much higher than famous products.
To realize brand premium, we should also base ourselves on the sum of various elements in the whole supply chain system, so as to achieve the purpose of * * * benefit sharing and win-win cooperation.
From this hot search of Fauvism perfume, we can see the challenges faced by many new domestic consumer brands in the process of growth. On the one hand, we should not only accumulate our own brand reputation in the time dimension, but also be sensitive to the needs of consumers at all times, and also build our own brand influence to achieve a breakthrough in symbolic value; On the other hand, domestic brands are also required to face the real challenges, go deep into the supply chain system and establish a stable relationship with manufacturers.
Brand management (second edition)
This article was originally published by everyone as a product manager, and it is forbidden to reprint without permission.
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Related question and answer: What does premium mean? Premium is more than the actual value and original price, which means that this thing is only worth 1 yuan, and some people are willing to go out to 2 yuan to buy it. Extended data:
1. premium is a term in the securities market, and the pinyin is yjià. Refers to the amount actually paid exceeds the par value or face value of securities or stocks. On the other hand, in the fund, it refers to the value that the transaction price in the closed-end fund market is higher than the net asset value of the fund unit. We usually say that a stock has a premium, which means that there is money after deducting various expenses and other expenses. When we say how much premium a stock has, we mean that we can judge the difference between the target price and the par price of the stock. Premium means that the transaction price exceeds the face value of the securities, and as long as it exceeds, it is called premium. Premium space refers to the part where the transaction price exceeds the face value of the securities. 2. Risk premium Risk premium: For risky assets, investors demand higher return on investment to compensate for uncertainty. This necessary rate of return compensation beyond the risk-free rate of return is the risk premium. Risk premium is also called risk reward. Risk reward is the extra reward required by investors for taking risks, which exceeds the risk-free reward. Return on risky assets = risk-free return+risk premium. Third, the stock premium We usually say that a stock has a premium, which means that there is money after deducting various expenses and other expenses. The cost of stock issuance is relatively complex, which generally includes two aspects: first, the pure issuance cost, that is, the related expenses incurred by the stock issuer in the issuance process, such as stock printing expenses, underwriting expenses, publicity expenses, and other intermediary service agency expenses; The second is the dividend paid by the issuing company to investors every year. Therefore, the ratio of the cost of issuing shares to the actual amount of funds raised is equal to the dividend divided by the issue price after deducting the pure issuance expenses. Expressed by a mathematical formula: the cost ratio of issuing shares = dividend/(issue price-issue cost) × 100%. Fourth, the warrant premium premium reflects how much the stock needs to rise or fall when investors buy a warrant at the current price and hold it until it expires, so as to guarantee this investment. From the calculation formula of premium (taking the subscription card as an example), premium is actually to calculate the difference between the break-even point [(warrant price/exercise price)+exercise price] and the stock price, divide it by the stock price, and then express it as a percentage. For example, according to the closing price on March 26th, the premium of CWB 1 in Shanghai Stock Exchange is 65.65%, that is, investors buy warrants at the current price (3.527 yuan) and hold them until maturity, and the price of Shanghai Stock Exchange Group must rise by at least 65.65% to 1 1.93 yuan, so as to ensure investment and profit. 5. Calculation formula: call warrant premium rate = (exercise price+call warrant price/exercise ratio-positive share price)/positive share price put warrant premium rate = (positive share price+put warrant price/exercise ratio-exercise price)/positive share price.