I am Brand: Q&A with Americus Reed II, Professor of Marketing, The Wharton School

When a customer is identity loyal, any competitor has to ask your customer to change who they are. That’s fundamentally different and quite a difficult argument.

Americus Reed II

Professor of Marketing, The Wharton School

While Americus Reed II is a Professor of Marketing at The Wharton School, he also has another title: Identity Theorist. As Reed describes it, “An Identity Theorist is a person who is interested in understanding the implications of how people come to have a sense of who they are.” When applied to branding and marketing, identity theory has the power to transcend traditional marketing techniques and the way we think about “brands.” When we internalize the essence of a brand as a part of who we are and what we want to project to the world — the brand and the consumer become one in vision and values.

This interview has been lightly edited and condensed for clarity.

 

What is the basic thesis of “Identity Loyalty”?

Identity loyalty really pushes marketers to think beyond repeat purchase. Traditionally, people define “loyalty” as someone buying the same thing over and over again. My argument would be: Sure, that person is loyal — to a certain extent. But what’s more interesting, from a marketing perspective is, how do I get that person loyal to the point that they see that brand, that product, that organization, that service as part of who they are?

And if a person takes the brand — not just its features, but other aspects of the psychological perception of what the brand means and stands for in the marketplace — and internalizes it as part of who they are, then there’s the potential to become loyal to that brand. Loyal in how the brand that communicates something about me that’s deeply personal and deeply emotional.

Here’s the thing that’s really interesting in identity loyalty. The brands who get it right are building a sense of connection that’s deeply based on self-expression and values. When you make this kind of connection with a consumer, price becomes a less significant factor in the purchase decision. If a competitor comes in with a cheaper product, it doesn’t work, because the entire connection is not based around a financial argument.

When a customer is identity loyal, any competitor has to ask your customer to change who they are. That’s fundamentally different and quite a difficult argument.

 

What’s a great company that connects with people’s identities?

I think there’s a spectrum of ability to connect deeply and emotionally. There are some companies that ge it. The people at Nike get it. Apple gets it. Starbucks get it… But the gap between the companies that really get it and the ones that don’t seems to be growing.

I love to use the brand Nike all the time because they understand that their story is really less about what are the shoes made out of and more about what does it mean to use sport and exercise as a way to transcend who you are. And so, let’s celebrate life and who you are through sport. That’s the message, and it’s an identity message. It takes sport, athletics, exercise, and activity and creates a sense of empowerment. The Nike swoosh then becomes a signal of desire to be loyal to that idea, mission, and set of values. It then potentially makes me want to wear that swoosh and not something else.

Of course, there are some product categories where it’s just going to be harder to build that connection. But it’s not impossible…

Take toilet paper. You can’t get more mundane than toilet paper, right? You might think: How do you tell an identity story about toilet paper? But there are companies and brands out there doing it.

There’s this company that removed the tube from the middle of the toilet paper. That’s the big idea: they removed the tube. In doing that, they’re being much more environmentally friendly. So, this is the toilet paper product that’s positioned to an individual who has some kind of idea about themselves as being environmentally friendly – and that product, that brand, is more relevant to that individual. It connects on an individual level. There’s an opportunity, even in that category, to create something that might have some self-expressive or value-based connotation to it.

 

Some of the language used by marketing today feels as if it comes from a bygone era — for example, terms like “segmentation” and “targeting.” How do you reconcile the emotional, human world of identity with the rigid, data-driven world of marketing?

It’s a very interesting point of contention, and it’s actually something I’ve grappled with. The way that I look at it is that there is a kind of common language we use: “segmentation,” “targeting,” “positioning,” and “messaging.” That’s just our vocabulary. All too often, companies end up with a complicated segmentation chart. And then you’ve got this persona: ‘This is David. He has 2.6 kids. What you end up with is something that’s not real.’

Segmentation is that Jane Goodall kind of exercise where you go into the jungle and live with these people and understand their lives from a 360-degree view, understand every possible aspect about who they are. Then that gives you some clarity around understanding who you really want to try to connect with… From my perspective, it’s like, let’s actually put consumers first. Let’s start with trying to understand them not in some gimmicky way, but in a way that is sociologically true to who they are and how they operate out there in the world.

So, I try to cognitively reappraise those terms. For me, “segmentation” — which sounds like a very clinical, surgical kind of a thing — is actually an understanding of who, from a sociological point of view, can I potentially really connect with?

 

The Business Roundtable has come out and said Milton Friedman was wrong: that shareholder value is not the only thing that should drive a business. What do you think about that?

In this day and age, I believe that you have to understand the consumer value — and the stakeholder value. It’s such an important thing you have to look at before you can even think about shareholder value.

The skills within the C-Suite will need to change. Now we live in a world where a part of what needs to be done is communicating the vision and values. Consumers are demanding to know what you stand for. The CEO and the CMO have to add another skill to their set – the ability to communicate values in authentic ways.

It’s going to be hard for brand managers — because right now, business success is measured on short-term metrics. The C-Suite want to know what your sales metrics looked like in the last quarter.

This is a significant shift. It’s a strategic decision to be more long- term in focus.

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