Risk and Brands

My body and my brain got into a bit of an argument this morning. My brain told my body that it wanted me to get an early start today, so my body did a Jedi mind trick on my brain and put it back to sleep. And then my subconscious took over and told a lovely story about a English lady with a Spanish accent that gave me, by accident, an incorrectly minted 1907 penny that was worth five-million dollars.

My body had insisted that I get some extra sleep as a result of my overexertions on Saturday. The day had started with a couple of Ultimate Frisbee matches (I know it is called “Ultimate” because of the trademark, but I have always thought that sound like a stupid nickname for the sport) in a local Corporate Games competition (we handily beat 1-800 Contacts and lost in a heart breaker to ATK; hopefully we will perform better against eBay tomorrow). After all that running around, I spent the next significant portion of the day helping move a neighbor (with, I think, about half of the employees of Struck Creative). The effect of this work was the overuse of many muscles I don’t use as often as I should.

While moving load after load after load, I read the sides of the boxes with my typical interest (my wife has problems with my grocery shopping style, which includes reviewing the design of the most trivial products’ packaging). A few things were obvious from this observation. First, they enjoy books. A lot. Second, Zappos is an important company to this family (this was confirmed with emotion when I asked about it). Third, U-Haul understands dregs (this needs more explanation).

This thought came from the my thinking about Seth Godin’s recent posting about “dregs” and how that concept applies to business. He wrote that dregs

lets the community know that you’ll backstop them, you’ll worry about what’s left, and you’re happy to be generous. It’s an expression of great humility, sort of the opposite of what people expect from a business.

And then I saw the U-Haul boxes that they had purchased with their rental.

If you can’t read the bottom, it explains that they buy back any unused boxes.

One of the most important aspects of brands is the fact that higher brand trust removes risk. There is a bit of a dynamic equation in that thought. Particularly in services, risk is inherent in any purchase decision. As a result, companies with less brand trust have to charge less for their offering because included in that discount is the increased risk that customers absorb. And the reverse is also true. The premium that good brands can receive is fundamentally a quality of customers paying more because there is less risk in the purchase decision (so there you go; now you know how my mind works—let me know if it is confusing).

So, U-Haul removes the risk by paying for the dregs. It works on the community-consciousness level that Seth discusses; it also helps in understanding the strategic and monetized approach that should be a part of brand building.

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