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The lifeblood of any business lies in its ability to attract and retain customers.  This is not only how it stays alive, but how it grows.  But how to do this best — the ideal path to achieving this goal — is a subject of ongoing debate. Two distinct schools of thought emerge. 

Camp One champions the supremacy of product excellence.  What did the companies that added over $100 billion in value in the last decade have in common? They didn’t advertise to get big.  They just kept improving their product / service.  The idea is that if you build an amazing product or service, you won’t need to advertise.  The argument is made by pointing at brands like Google, OpenAI, and Netflix.  They built a great product and disrupted the world. 

Brand building was never the focus and advertising was not needed.  Indeed, Scott Galloway, a Clinical Professor of Marketing at NYU Stern School of Business for 22 years, argues that a mediocre product can’t survive anymore. Money is being ploughed into improving the experience, not advertising or brand building.

Camp Two, on the other hand, advocates for the power of brand building. They argue that, in today’s saturated market, a fantastic product alone simply isn’t enough.  As best-selling author Stephen King once explained, “A product can be quickly outdated, but a successful brand is timeless.”  And even the most innovative offering can get lost in the noise without a well-defined brand voice. This voice is the company’s personality, its unique way of communicating its values, purpose, and the story behind the product. It is how a company connects with its target audience on an emotional level, building trust, loyalty, and a sense of community.  Brand advocates indicate that history is littered with examples of fantastic products that failed to achieve market dominance due to a lack of brand focus. Here are a few cautionary tales:

• Kodak practically invented the consumer photography market. However, they failed to adapt to the digital revolution and build a brand that embraced change. This allowed nimble competitors like Sony to capture the market with a more forward-thinking brand image.
• Blackberry was a pioneer in the smartphone era.  They offered a secure messaging platform. However, they were slow to adapt to the evolving needs of consumers and build a brand that resonated with the changing user landscape. Apple’s sleek design and user-friendly experience ultimately conquered the market.
• Betamax boasted superior picture quality compared to VHS. However, Sony’s focus on superior technology overshadowed brand building. VHS, with its cheaper tapes and aggressive marketing, became the dominant format, despite offering a slightly lower quality product.

Both arguments offer much to their credit, and it’s not clear if either argument is right.  But, perhaps that’s because there isn’t one answer.  The true path to sustainable success often lies at the intersection of these two philosophies. The most effective businesses understand that a superior product combined with a compelling brand narrative creates a potent force.

• Product as the Foundation – The product or service needs to be a solid foundation. No amount of brand messaging can overcome a mediocre offering. Investing in continuous improvement to ensure that the product consistently delivers value and exceeds customer expectations is critically important.
• Brand as the Amplifier – However, once there is a solid product, leadership must leverage branding to amplify its appeal. Companies with top quality products or services must then craft a message that resonates with the target audience, connecting with their values and aspirations. A strong brand identity creates a loyal customer base that advocates for the offering.  Companies like Nike exemplify this strategy. Nike consistently delivers high-performance athletic wear while simultaneously promoting a message of empowerment and pushing athletic boundaries. This combination of product excellence and inspirational branding has propelled Nike to become a global powerhouse.

Option Three:  The Intertwined Dance of Product and Brand

While the arguments presented by both camps are compelling, the reality is that true success lies in the harmonious marriage of product and brand.  That’s because:

1. A strong brand amplifies a great product.  Even the most innovative product can struggle to gain traction without a brand to champion it. A compelling brand story and targeted marketing create awareness and position the product in a positive light.
2. A great product fuels brand advocacy.  A product that consistently delivers on its promises becomes a brand advocate itself. Satisfied customers share positive experiences, strengthening brand reputation and attracting new customers.

Product vs. brand is not an either/or proposition. Companies that prioritize both thrive in the long run.  That said, it is challenging for new companies to do both simultaneously.  And there’s no one-size-fits-all answer.   It is, therefore, important to find the ideal balance between product excellence and brand building and that depends on the specific market and business model and the timing of that for the business.  Some argue that the goal should be to focus first on building the product / service and then, once the company has a certain amount of traction, toggle to focus on brand-building.

But, let us consider the issue of product vs brand through the lens of early adopters vs mainstream consumers.  Companies start with a ‘brandless product’. They hone that product. They compete against other brandless products. They sell to early adopters who buy new products or try new services hoping they’ll win some advantage over their competitors or because they like being the first to innovate.

However, to jump the chasm to reach mainstream consumers, that company needs to wrap the product in a brand.  They need to not just win but keep consumers based on emotional resonance. To do that, they need to make every experience consistent, not constantly new and improved.  In this regard, brands are seen as being a “virus.” The more different and distinctive products are initially, the further they grow. But, eventually they reach a plateau where they stop growing and need branding and paid advertising to take virality to the next level, like a virus mutating.

Zoom: Built an Unmatched Product for Tech Enthusiasts and then Built a Brand

Case in point.  Zoom Video Communications, the ubiquitous video conferencing platform we all know today, exemplifies the power of strategically pivoting from product focus to brand building to achieve exponential growth.  Founded in 2011, Zoom initially targeted a niche audience – tech-savvy professionals and early adopters. Their core focus was on building a superior product that offered exceptional video and audio quality, seamless screen sharing, and a robust security framework. They prioritized features like “end-to-end encryption” and “waiting rooms,” catering specifically to the needs of this tech-conscious user base.

Zoom’s dedication to product excellence paid off. Early users were impressed by the platform’s stability, ease of use, and superior functionality. Positive word-of-mouth spread quickly within the tech community, leading to organic growth. This initial success stemmed purely from the product’s inherent value proposition, with minimal marketing efforts.

As Zoom’s user base expanded beyond tech enthusiasts, the company recognized the need to broaden its appeal. They pivoted their strategy, focusing on building a recognizable and relatable brand. First, they simplified their user interface. While maintaining core functionalities, Zoom streamlined its interface for a wider audience. This made the platform accessible to non-technical users, fostering wider adoption.  Then, they offered a Free Tier and Freemium Model.  They introduced a free tier with basic features, allowing a broader audience to experience the platform’s benefits. This freemium model generated brand awareness and nurtured potential paying customers.  Once they gained traction, Zoom shifted gears and launched targeted marketing campaigns. Catchy slogans like “Zooming” became synonymous with video conferencing, solidifying their brand presence in the public consciousness.

The result was exponential growth and market domination.  The combination of a stellar product and a strategically developed brand propelled Zoom to unprecedented heights. The COVID-19 pandemic further accelerated their growth as video conferencing became the norm for work, education, and social interaction. Today, Zoom is a household name, a testament to their successful transition from a product-centric approach to a powerful and well-recognized brand.

Time the Toggle

For companies, staying in the product / feature / benefit game is exhausting, and self-limiting.  They key is to first build the product or service.  Then, to level up, it becomes imperative to shift focus from R&D product development to brand-building and storytelling.  Netflix, Amazon, and basically every multi-billion dollar company did it that way.  So, it is not a question of product building vs brand building.  It’s a question of timing.  Build an amazing product first and then kick brand into high gear to take the company to the next level.

Quote of the week

“A product is something made in a factory; a brand is something that is bought by the customer. A product can be copied by a competitor; a brand is unique.”
Stephen King

© 2024, Keren Peters-Atkinson. All rights reserved.