The Rising Impact of Brand

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You've got the questions

and we have the data.

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Each week, we dive deep on benchmarks

of the subscription economy that

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you just can't get anywhere

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else.

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This is the ProfitWell Report.

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Hi. My name is Lydia Newton,

and I'm the CMO of binder.

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We help our customers all over

the world to build and maintain

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a consistent brand,

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and we all know a strong

brand when we see it.

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But my question is,

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to what extent does this affect

the purchasing decision and

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willingness to pay?

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Great question, Lydia.

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Time and time again,

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founders and marketers think

that brand is just something

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fluffy for b to c companies

in the world of fashion.

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You know, with customer acquisition

cost continuing to increase and

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willingness to pay

continuing to drop,

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data suggests that brand just

might be your new secret weapon.

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To answer Lydia's question,

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we looked at nearly three

thousand different companies in

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over a million different

consumer transactions.

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Here's what we found.

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First up, to get a direct

answer out of the way,

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a great brand absolutely

increases the willingness to

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pay and retention

amongst customers.

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We coded respondents'

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perception of a company's

brand before measuring their

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willingness to pay,

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and those consumers who had a

positive perception of a brand

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actually had an increased

willingness to pay of sixteen

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to forty one percent

than the median.

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Those on the negative

perception side had fifteen to

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thirty three percent

lower willingness to pay,

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and neutral respondents were

willing to pay about six to

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fifteen percent less.

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Based on this data,

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brand not only drives

higher willingness to pay,

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but also can very much detract

from your ability to sell to

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your customers at the level

that is necessary for success.

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High and low ARPU consumers

with positive brand perception

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see between fourteen and thirty five

percent higher willingness to pay.

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B to b and b to c breakouts

are eerily similar both on the

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positive and negative

sides of perception.

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Thinking even further,

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retention tells a similar story

as those folks on the positive

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perception of brand have

roughly eleven to eighteen

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percent higher retention,

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while those on the negative

are seeing twelve to fifteen

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percent lower retention.

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The bottom line is as more

and more features get built,

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competition remains on the

rise and the function aspect of

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software becomes

less differentiable,

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these formerly intangible pieces of

building a product, brand, design,

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and even support will continue to

become more and more important.

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Well, that's all for now.

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If you have a question,

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shoot me an email or video

to p c at profitable dot com.

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And let's also thank Lydia

for sparking this research by

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clicking on the link below

to give her a shout out.

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We'll We'll see you next week.