The History of Brands, Part 4

Welcome to part four of my series on the history of brands.

We're looking at brands as tools that have evolved, over thousands of years of use. And each one of the stages of that evolution we're thinking about as a layer, like the layer of an onion. Each of those layers builds on the layer that came before but doesn't replace it.

So today we're looking at the fourth stage of that evolution, and that is brands as marks of status.

With the rise of modern corporations in the 1880s, brands grew in reach, influence, and sophistication. Businesses realized that people were willing to pay premium prices for brands that conveyed quality, luxury, or status. The ability to use brands to convey status had a few benefits.

A premium brand, increased demand. It strengthened loyalty while also increasing prices and profits. As premium brands emerged, it became clear that status conscious buyers would willingly pay significantly more for products based not on the product's quality, but on its brand.

The tactic was especially effective for products such as clothing, watches, and luggage that were conspicuously consumed, meaning that they were worn or used out in public. Brands that could convey status became a way for customers of the brand to convey their own status. This played directly into the insecurities of the emerging bourgeoisie who were increasingly rich, yet also insecure about their social standing relative to those in the aristocracy.

Perhaps it's not surprising then that the first luxury brands were started in Paris in the years after the French Revolution. It was here beginning in the 1850s that George Haussmann's massive renovation of the city created the parks, gardens, and boulevards for which Paris is still famous today. The design and creation of these new public spaces changed the way that people interacted and opened up new opportunities for all to see and be seen.

The streets of Paris became the ideal stage for an emerging class of urban elites to show off their luxury goods and finery. As department stores such as Le Bon Marche sprung up to meet this demand, they themselves became forums for customers to experience and express their status. It was in this context that watchmakers like Vacheron Constantin, fashion houses like Hermes and luggage makers like Louis Vuitton built luxury brands that endure and remain relevant to this day.

Michael Kors, Coach, Vivian Westwood, Mark Jacobs, can we really call those brands luxury? If you take brands like Dior, Chanel, Louis Vuitton, Hermes, they have established themselves as brands that those of us who are into this kind of thing will willingly, well, not willingly, but begrudgingly, uh, if you are into it, go and spend the money on. Whereas if there was a Coach bag for 4,000, would, would you go and spend 4,000 pounds on a Coach bag?

No. So if you can see, I haven't done work, done any work on my chain for a while, so it's kind of dry and needs a little love. So I'm gonna show you how I fix this.

As brands became expressions of status, what they conveyed about the quality of a product became less relevant than the qualities they conferred on the product's owners. Realizing this luxury goods manufacturers design products that would telegraph their brands.

This could be achieved through subtle aesthetic cues in cases such as Louis Vuitton's, famous LV monogram, or in much less subtle ones that would be unmistakable even from a distance. The ability to strengthen customer loyalty while charging a premium price continues to be a central function of brands.

Today, this is most evident in fashion brands and indeed Louis Vuitton, although a very different company than the one that started in the 19th century, is Europe's most valuable company.¹ But other companies with conspicuously consumed products have taken a page from fashion's playbook, creating brands that convey status through products as wide ranging as technology, automobiles, and sporting goods.

Even services and intangibles can fulfill this function, as anyone who's tried moving from an iPhone to an Android device can attest. Losing your blue text on Apple's iMessage can make you feel like you've lost a mark of social standing.

Next, we'll look at how brands developed over time as tools to promote the reputations of companies and products to bigger audiences through mass media.

1. While this was true when I created the video, LMVH has since been eclipsed by Ozempic-maker, Novo Nordisk.