There's No Place Like Home: Consumers Prefer Brand Authenticity

We are the world, or we may aspire to be, but that doesnt appear to stop us from preferring brands that tout their local roots.

One of the many ironies of the global economy is that the more homogenous we become, the we value location-specific identities as a means of validating authenticity. 

It may well be that shoppers perceive a global market of products that could be - and are - made almost anywhere. This does not necessarily impinge on their reputation for quality, but in a world in which technology has stripped much of an individual's individuality, promoting one's terroir - whether in wine, windows or wetsuits - enhances the perception that if the product is sufficiently differentiated, then so might be its owner. This need to stand out from the swelling global crowd may affect products from food to electronics, elections from Hong Kong to Scotland and attitudes, from almost anywhere.

Marketers would do well to remember that 'location, location, location' is an asset well beyond the earth-bound confines of real estate itself. JL

Sheila Shayon reports in Brand Channel:

Consumers place higher value on products perceived as authentic
Authenticity is contagious, according to a new study published in the June 2014 issue of the Journal of Marketing Research.
“Authenticity is Contagious: Brand Essence and the Original Source of Production” indicates that, “products manufactured in the original factory acquire the essence of the brand through a contagion-like process,” said study co-author George Newman, assistant professor of organizational behavior at Yale SOM. “Consumers believe that products made in the original factory possess the essence of the brand more so than products made elsewhere, which in turn causes them to be perceived as more authentic and desirable.”
A series of experiments including Levi’s jeans, gourmet chocolates and luxury bags showed that “participants were willing to pay significantly more for products made in the original factory than those produced in either a newer factory located in the same city as the original or in a foreign factory," the study showed. “Participants also placed a higher retail value on factory originals, and viewed them as embodying the essence of the brand more than products manufactured elsewhere.” For instance, Godiva chocolates, made in Brussels, Belgium since 1926, were perceived as more authentic than those made at the brand’s Pennsylvania facility.
“Brands like New Balance, Hershey’s and Fuller’s Brewery of London that prominently promote the fact that their products are made in the original factory may capitalize on emphasizing that physical connection,” the study found. “However, consumers won’t always prefer products from the original factory. For companies with a negative reputation, contact with the original factory may turn off consumers.”
The reason for either behavior is a belief in what the study calls "contagion," meaning that consumers feel the essence of the brand is transferred to the product through its original sourcing. But "meaningless attributes often lead to meaningful differentiation," Ravi Dhar, co-author of the study and director of the Center for Customer Insights at Yale SOM, said, according to the Washington Post.
Dhar was talking specifically about Heinz ketchup, which does not consistently win in blind taste tests but has become a category gold standard for its viscosity. Dhar also notes that “consumers prefer detergents that are chunkier over those that are powdery because of the perception—false, as it turns out—that they are more potent and effective.”
Consumers place higher value on products perceived as authentic. “Authenticity is the quality of being genuine, and ultimately of being trusted,” said Scott Monty, former head of global digital communications for Ford Motor Company, in an interview with the The Guardian. “Transparency gets your brand attention; authenticity allows your message to be heard and believed.”
Authenticity can come through not only in the actual product, but in advertising as well, as Inc. pointed out. Charles Revson, builder of the Revlon cosmetics empire, took full-on advantage of this principle, according to "Fire and Ice," an unauthorized biography by Andrew Tobias. “Revson refused to base the price of his beauty products solely on their cost ... For example, though other nail polish products sold for 10 cents during the Great Depression, Revson's products were 50 cents. His lipstick sold for one dollar, compared with the 49 cent price of competitors'," Inc. reported “He realized that he could charge double or more and still get his customers to perceive that they were getting a great value. After all: What price can you put on romantic hope?”
After all, authenticity and brand experience go hand in hand in creating a desirable brand for consumers.