The Nobel prize-winning psychologist Daniel Kahneman is well known for his pithy turn of phrase.
Perhaps his most striking quote about behaviour compares people to cats. In his words:
"Thinking is to humans as swimming is to cats. We can do it but we’d rather not."
By this, he means that people are cognitive misers. We have so many daily decisions that we can’t weigh them all up in a fully considered manner. If we did, we would never make it out of the house in the morning. So, instead, we ration our thinking.
This happens when we’re shopping. Rather than deliberating over every potential product on its many merits, we use shortcuts to speed up our decisions.
Neighbours are quality cues
These shortcuts should interest marketers because, if we’re aware of them, we can shape our communications to work with human nature, rather than against it.
There are many shortcuts that are relevant to marketers. But I want to discuss one that has been the subject of recent research: how shoppers judge the quality of a brand by the company it keeps.
The 2021 experiment in question is from Heeyon Kim at Cornell University. She recruited 1,123 participants and assigned them to one of three brands:
- Low (e.g. J Crew or Banana Republic).
- Middle (e.g. Stella McCartney or Jil Sander).
- High-status brand (e.g. Chanel or Hermes).
The participants were then allocated to one of the following three conditions:
- Base: participants were shown an ad for the assigned brand in Vogue.
- Mixed: participants were shown an ad from the assigned brand, as well as from six other firms (two low, two middle, and two high-status).
- High: participants were shown an ad from the assigned brand, as well as from six other high-status firms.
After seeing these ads, participants were asked to rate the prestige of the brand that they had been allocated.
The low status and medium status brands saw an uplift of 17% in terms of their prestige when they were shown among high-status brands, compared to being shown on their own.
Kim found that mere proximity to other brands - especially high-status ones - boosted the appeal of the test brand.
In the words of the author, “relative proximity to prominent high-status firms increases the perceived status of the focal firm”.
Surround yourself with prestige
The finding that the company you keep affects perceived quality has important media implications.
If you want to boost your perceived quality, then it’s worth identifying and running in environments where you will be surrounded by similarly premium brands.
Conversely, you should avoid situations where you’re surrounded by a ragtag of companies advertising diet pills and dodgy services.
That might sound obvious - but how many digital environments offer that protection?
Proximity through media
You can apply the findings from this experiment in a literal manner, by adjusting your media mix. Or you can apply the idea laterally.
For example, Zara applies the principle of mere proximity to its store locations. In the words of Masoud Golsorkhi, editor of the fashion magazine, Tank:
"The high street is really divided according to brand value. Prada wants to be next to Gucci, Gucci wants to be next to Prada. The retail strategy for luxury brands is to try to keep as far away from the likes of Zara. Zara's strategy is to get as close to them as possible."
I began this piece with a quote, so perhaps it’s fitting to end with one too.
This time from Don Quixote. In it, Sancho Panza, the loyal squire, proclaims:
"Tell me your company, and I will tell you what you are."
That was true in 1615. Kim’s work suggests it’s just as true today.