When buying a soft drink gives pause for thought

by Nigel Hollis | November 06, 2017

When I wrote my post about behavioral economics a while back I compared buying a soft drink with buying a car to highlight the different degrees of conscious thought we invest in making a purchase decision. However, I can think of one occasion when I have been forced to think about which soft drink brand to buy and it highlights the influence that brand familiarity has on the purchase process.

So let me take you back in time to my first visit to Japan about ten years ago. Walking back from the (then) Millward Brown office I came across a vending machine at the edge of a park and stood nonplussed for a couple of minutes because none of the brands were familiar to me. These were all new brands to me and the names alone were somewhat off-putting. I did not like the sound of Pocari Sweat or Amino Calpis. Instead I choose C.C. Lemon on the grounds that I know what "lemon" means.

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If we frame this decision in terms of mental and physical availability then all the brands were available when and where I wanted a drink. However, the only thing that was mentally available was “lemon”. This is why we always find strong relationships between brand awareness and trial and even awareness and last purchase. The more familiar people are with a brand, the more likely they are to buy it.

In his book ‘Gut Feelings’, Gerd Gigerenzer provides us with a number of examples where recognition alone provides the basis for making a decision. Gigerenzer suggests that recognition works well because it infers a value without the need for further information. It basically means ‘go with what you know’. And for most habitual purchases that works.

But familiarity alone does not guarantee purchase, and recognition is only the first heuristic to be applied to any decision involving choice. It is applied only if there is just one option that is recognized. What if there are multiple options recognized by the decision maker? The it all comes down to context and how quickly the brand is associated with that context.

People buy different brands for different needs. I buy Coca-Cola for a refreshing lunchtime drink when hiking. I rarely buy it otherwise. Would I buy Pepsi instead? Only if Coke was unavailable. Physical availability will determine whether people can even find their usual brand or not. From the marketers' viewpoint, this emphasizes the importance of the in-store environment because for someone to recognize their brand it must be stocked and easily visible on shelf.

So why do I have this innate bias to buying Coke instead of Pepsi? Unfortunately for Pepsi I suspect it originates long ago and far away when as a child I was given money to go buy a bottle of Coke on a hot summer’s day. And years of exposure to advertising have kept the brand salient since. But would I have bought Pepsi if it had been in that Japanese vending machine? Yes.

So physical availability and brand recognition have a huge influence on whether a brand gets purchased or not but would recognition alone decide whether someone pays a price premium for a brand? What do you think? Please share your thoughts.

4 comments

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  1. Ted Stickles, November 07, 2017
    Another phenomenal article put together, Nigel. You've really out done yourself this time!
  2. Roberta lietti, November 07, 2017

    Hi Nigel tHanks. For your thoughts that always give value to my metro trave! 

    I want to.add something to your reclection

    Probablly if I were in Japan I would choose The Less unknown drink driver by curiosity and The need to discover The culture of such a differenti country that to Say that The emotional context is another important issue to Take in consideration 

    Have a Nice day r

  3. Alison Smith, November 06, 2017

    Your post resonated with me Nigel from many holiday trips where I end up spending much more time making decisions because the cues of familiarity are absent. I never buy Dolmio at home but am pretty sure I did in Greece because I was clueless as to what anything else was - and how happy we were to find Weetabix there!

    Being confronted with unfamiliar brands also makes you register the role of packaging more and what cues brands are trying to give you. I suspect there are times when recognition leads to a certain forgiveness on the part of the consumer about price - depending on the absolute amount of cash involved, there's a lot to be said for the avoidance of risk that you get from buying something familiar (either because your mum always bought Persil or everyone buys Gold Blend) 

    Thought provoking as always :)

    Alison

  4. Aishika Bhattacharya, November 06, 2017

    It varies consumer to consumer and hence segmentation and clustering are important for a brand. 

    Similar to this about 6 years back we went on a family trip to Thailand, Singapore, and Malaysia. Now since we follow Hindu religion we do not eat beef or pork and we were skeptical of the local restaurants serving us the meat we don't eat especially because of the language barrier. KFC, McDonald's were known brands to available to us and hence we chose to eat there though we do not go these eateries on a regular day. 

    However, say if this was the case in my country and and I know that here I will not get pork or beef unless I ask for it specifically. Unless there was a special launch at KFC or something really special happening I wouldn't have gone for these restaurants. Some of my friends, however, are McD loyalists and would go to a McD joint wherever they located it. 

    Hence, it will differ person to person. Some will be absolutely high loyalists to the brand. As in if the cold drink is not Coke I won't consume it and rather look for nearest place to have water however some would be product loyalists, like me. I love soft drinks on a sunny day and Coke is my favourite. However, it is scorching day and Coke is nowhere to be to seen but hey a local drink is available made of lemon juice and soda so be it. 

    It will also vary from a high involvement brand to a low involvement brand. High involvement would probably bank more on recognition and availability.  

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