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Why Brand Loyalty is Bad for You

By (view all posts by pmiller)
at 8:56AM Thursday August 25, 2011
under Newsworthy

Photo courtesy of Daniel Spiess, via Flickr

Once again, scientific research has confirmed the obvious: fanboys take their favorite brands much too seriously. As Ars Technica reports, a forthcoming study in Journal of Consumer Psychology shows that, for some, brand image can become inextricably linked to self image. For these unlucky, annoying few, a criticism of a brand can feel like a personal attack.
We should all strive not to be these people. While sometimes we are justified in preferring one brand over another, the best approach is to judge everything we buy on its own merits. If the trendy name brands and the less glamorous store brands are on a level playing field, chances are we'll wind up saving a lot of money in the long run.

To that end, here are the top reasons why brand names don't matter.

Your Favorite Brands Don't Make Anything

When you think of brand loyalty, you think of Apple. Apple has such a strong brand image that we don't even consider Macs a kind of "personal computer," as evidenced by the insane "Mac vs. PC" dichotomy. So it might surprise a few fanboys to learn that Apple does not make computers of any kind.

In fact, the enormous Taiwanese manufacturer Quanta makes about a third of all laptops sold including laptops by Apple, HP, Toshiba, Lenovo, Dell, Gateway and Sony. Even the components of the computers come from just a handful of manufacturers. For example, all hard drives are made by the same five companies. That shiny Iomega drive that matches your new Mac Mini probably has the same parts as a much cheaper, uglier hard drive.

Apple fans might argue that Apple does design their operating system. It is, in all fairness, pretty great. But with a little work, you can get Mac OS to run on just about anything.

Your Favorite Brands Make Everything

Sometimes, your favorite brand will be part of a good old fashioned monopoly. If you have trouble deciding whether or not you prefer Ray-Ban or Persol, Dolce & Gabbana or Bulgari, Arnette or Oakley, then you're in luck: your real favorite brand is Luxottica. Luxottica produces all of these brands and a ton more. They even own the stores that sell you the glasses, like LensCrafters and Pearle Vision.

What's more, 70% of the glasses Luxottica sells are made in the same factory, out of the same materials. That $500 pair of D&G sunglasses will likely not offer any real advantages over that $15 pair of sunglasses you can get at the drugstore, because Luxottica probably makes those, too.

If you decide you've had enough Luxottica for one lifetime, there are alternatives. Cheap ones, too. For tips on buying prescription eyeglasses online from small, innovative companies like Warby Parker, check out Allegra's instructions for buying glasses online.

Generic is Identical to Name Brand

As Sarah covered in her post on prescription drugs, generics are just as effective as the name brands, at only a fraction of the cost. You may come across some dissenting opinions on this, but here are the facts: All drugs, name brand and generic, are regulated by the FDA. The FDA mandates that generic drugs be identical to name brand, in "dosage form, safety, strength, route of administration, quality, performance, characteristics and intended use." In short, they are the same in every way.

Every way except cost, that is. It's no secret that going generic can save you hundreds of dollars. If the medicine you need is commonly prescribed, you might be lucky enough to find it in one of the ever-expanding $4 generic drug programs. (If you take a drug that has a narrow dose range, like certain epilepsy drugs, you should avoid switching between name brand and generic. This, however, is not typical.)

Generic is Slightly Better than Name Brand

In many cases, the store brand products are the same as their name-brand counterparts. For example, Alcoa, the company that makes Reynolds Wrap, also makes store-brand foil. In this case, you're getting basically the same foil at two different prices.

Other times, store-brand items are made by the same manufacturers as the name brands, but to the specifications put forward by the store. That can of Professor Flavor soda might come from the same bottling plant as Dr. Pepper, but it will not be made from the same recipe.

But that doesn't mean Professor Flavor's diploma is worthless. At least one double-blind study showed that consumers actually preferred the taste of store-brand items, by a very narrow margin-- 51% to 49%. It's not much, but it should be enough to convince the skeptics that the cheaper options are plenty good enough.

Do you have any store-brand items you prefer over their name-brand equivalents? Any generics that don't live up to the original? Please share in the comments.