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What Luxury Brands Can Teach Uber

The case mentioned that despite a major turnaround in the early 2000s, Burberry began experiencing new challenges including lacking exclusivity due its almost ubiquitous "check" and the adoption of the brand by non-target customers. Based on the case, it seems as though Burberry was able to achieve salience because of the deep, broad brand awareness. The ad campaigns and redesign and introduction of Burberry products created a new identity for the brand that spoke to consumers desires to be both functional and fashionable. Burberry was even able to achieve meaning through differentiation and response through positive reactions and associations with the brand. However, at the time of the case, Burberry did not seem to achieve brand resonance with the target customers it desired. The target customers did not have a collective intense and active loyalty to the brand. This could be because the brand was not providing enough value to the customers by "protecting" its exclusivity (i.e., the rise of counterfeits) or rewarding its customers for their loyalty (i.e., Hermes providing limited quota bags to loyal Hermes customers). Because of the lack of brand resonance, Burberry did not experience its customers defending or protecting the brand the way other brands have experienced (i.e., loyal Chanel customers continuing to purchase handbags, especially the Classic Flap, despite the astronomical price hikes to further alienate non-target customers).

While Uber and Burberry operate in entirely different spheres, there are some lessons that can be applied to Uber as it thinks about how its customers can co-create and defend the brand when sufficient value is provided. I have been a customer of Uber since 2016 or 2017 and in all the years I have used Uber, it has never been more than a functional app for me. This is also true of many of my friends who also use Uber. Uber, especially as of lately, does not provide enough economic, cultural, social, or temporal capital to truly achieve brand resonance. This is evidenced by the fact that whenever a new rideshare app that offers lower pricing or better promotions enters the space, I try them out. Throughout my time as an Uber user, I have not reached a "status" that truly rewards my use of the service in a substantive (compared to Marriott, for example, that provides status tiers for staying a certain number of nights in their properties). I think that Uber would benefit from finding ways for customers to more closely tie their social identity with the brand. Additionally, Uber might also be able to leverage its employees/ contractors to increase brand resonance.

[ogeviii]

Uber's Diffusion According to Roger's Five Factors

For our branding lab project, we will be looking at how Uber and its branding. In order to better understand Uber's current standing, it's important to also think about how Uber came to be. According to Rogers' Five Factors, Uber was able to diffuse so pervasively due to the following reasons:

Relative Advantage: When introduced, Uber was positioned as a direct alternative to traditional taxi companies and individual taxi drivers. Uber saw that taxis lacked convenience and transparency. In big cities such as NYC, it was somewhat easier to call a cab but you had to be in the right place at the right time. And still, even after you call or catch a taxi, it's impossible to know the exact pricing you will be charged before getting into the taxi. With Uber, consumers were newly able to call a car from wherever they were and see the associated price of the ride.

Compatibility: Uber was compatible with potential users' beliefs that on-demand service is a necessity. Uber emerged after giants such as Amazon, offered services like 2-day delivery. This began training consumers to expect more immediate service, especially on cellphones which were also widespread.

Complexity: Speaking from personal experience, Uber was quite easy for me to adopt because it was easy to use. The user interface made it straightforward to call a car, see the price and make the payment for the ride.

Trialability: Uber launched in San Francisco which is an ecosystem full of innovators. Located right in the hub of Silicon Valley, San Francisco is full of people ready and eager to try new to market solutions that the rest of the country might be hesitant to adopt. Once validating the concept there, Uber began to expand.

Observability: Uber's observability primarily came from its users that leveraged the service. For example, there were often times I would arrive to an event via Uber to meet friends who were running late because they were waiting for a taxi or public transit. Those friends would see the benefits of Uber and then I would refer them, providing additional benefit for myself, an adopter, and soon-to-be adopters.

[ogeviii]

Red or White? Either way, we'll need to call an Uber

Concha y Toro is a Chilean wine corporation that was able to achieve relative success by targeting a brand awareness to customers that suggested value for money. The corporation plays across various price points in the wine industry ranging from cheap to premium; all the wines that fall into those segments are considered quality wines to ensure that customers are satisfied with their purchases with the newer emergence of New World wine on the market. However, an important consideration for Concha y Toro is the perception of quality to the customer, especially customers lacking brand loyalty and a robust knowledge of wine. For example, when I am buying wine for myself and others, I simply ask if there is a preference for red or white. Then based on the preference, I purchase a bottle that 1) is closer to the higher end of my willingness to pay and 2) has a nice aesthetic look. Both of these characteristics, price and look, are a proxy for quality for me. I believe this is because, as mentioned in the case, the wine industry is so fragmented and there are simply too many options to choose from.

For our branding project, we plan to look at Uber and how it has been able to maintain a semblance of brand loyalty, even in cities with multiple accessible transportation options such as Boston (which has the MBTA, BlueBikes, and reasonable walkability). Most ride-share customers decide to take an Uber at the point that they realize they want to go to a destination and for some reason do not want to utilize an alternative transportation option. There is the customer perception of availability and quality (in the sense that the Uber will get you to where you need to go for the price you paid) when booking an Uber that builds brand loyalty. And this brand loyalty starts at incentives offered to potential customers to try out the product. While the rideshare industry is far less saturated than the wine industry, there may be opportunities for Concha y Toro to similarly offer incentives such as price promotions and to make consumers more likely to make their wines the default choice in the midst of many options.

[ogeviii]

Market Research from the Eyes of the Researched

The 1991 HBS Market Research case highlights the best practices in commonly used market research methodologies. Namely, it focuses on how to best conduct market research to more aptly make decisions to achieve some goal (i.e., profit, increased user awareness, increased customer loyalty, etc.). The quality and robustness of the methodologies used to conduct market research will directly impact how useful the results of the research are. At Sloan, I have had experience conducting some market research ranging from leveraging the ZMET technique to elicit customer sentiments about a product to conducting structured interviews to understand how sustainability professionals think about buying carbon credits. However, prior to my time at Sloan, I was mostly a test subject for various types of market research.

Reading the case elucidated the reasoning for some of the pitfalls I've seen as both a market research interview. In college, I participated in an individual depth interview about my experience with a specific on-campus café. It was a 1:1 interview in which, like mentioned in the case, there did not seem to be set questions from the interviewer. Rather the interviewer posed some initial guidelines that set the stage for us to speak about all of my sentiments about the café. My driving motivator for conducting the interview was the monetary incentive that was offered for my participation. While I'm sure the more intimate nature of the interview uncovered interesting takeaways that may not have surfaced in a different setting, I'm sure the monetary incentive introduced a sampling constraint of students that needed the money.

An interesting aside about focus groups: As a fan of the show Impractical Jokers, I have seen how focus groups can be beneficial for market research, especially for testing new ideas. On the show, the 'Jokers' will conduct prank focus groups in which they present asinine ideas to a group of unknowing focus group participants. The goal is to get as many participants on board with the outlandish idea or to capture the attention of the participants the longest. A trend that is evident throughout most of the focus groups is that participant's tolerance for unorthodox proposals is significantly higher when surrounded by others, likely due to the pressure of not wanting to be the odd one out. While expensive, focus groups can be effective, even in ridiculous situations.

[ogeviii]

Mr. Tradesman…Why are you so Afraid, Man?

Black & Decker (B&D) is being outsold by Makita 8 to 1 in the Professional-Tradesman segment for power tools. This comes as a surprise considering B&D's dominance in the Professional-Industrial and Consumer segments, but especially the former. According to extensive market and consumer research, B&D's price, quality, service and distribution channels should lend itself to favorable performance in the market segment. However, one factor that B&D didn't account for is brand perception at an individual consumer level. Because of the brand's success in the Consumer segment, many tradesmen view B&D as something their wives would use because of the pedestrian value of the products. Tradesmen are afraid that their perception as professionals could be tarnished if they "came out [there] with those gray Black & Decker things". Not only could their perceptions be hampered, but also their livelihoods could be adversely impacted if negative perceptions lead to a loss of work, as tradespeople often work in collaborative environments.

As mentioned, B&D dominates the Professional-Industrial segment but falls behind in the Professional-Tradesmen. I would expect the segments to be similar, but like B&D, I'm operating under the same assumption that individual consumers make purchases that are as rational as a corporate entity (with a centralized purchasing function). However, like tradesmen, I'm not a rational buyer (as evidenced by me procrastinating booking my building's social room for graduation for an actual family event that I've already invited people to yet impulsively buying overpriced cardigans because an influencer received a bunch of positive comments from strangers) because I am human. In contrast, when purchasing on behalf of a corporation, I, like buyers in the Professional-Industrial segment, am forced to be more objective due to policies and dependencies that are codified and enforced by the company. B&D will continue to suffer in the Professional-Tradesman segment if it does not begin to cater to the humanity of tradesmen by getting to the root of what tradesmen are afraid of -- not being taken seriously in their profession. Almost instinctively, I would suggest that B&D make more of an effort to more closely align the Industrial and Tradesmen brands through logo, product color, and marketing. However, B&D has done that to little avail. I believe B&D may need to rely more on distributor channel education and incentives as well as tradesmen influencing to build upon the social capital these assets have.