It's about the status, stupid.

This week's These Three Things is about the vexed question of how premium brands work. The answer is conventions of status.

Sometimes it takes an outsider to point out what’s going on.? In his book Status and Culture, author W. David Marx* explains how we create, then follow, sets of status conventions. It’s very human that “individuals know something, and know that others know it, and know that others know that they know it”.??

All brands, everywhere, are signals of status, mostly to others but often to ourselves. Gregg's denotes a particular form of status. ('I'm a worker bee'.)

But deliberately premium and prestige brands seek to invent or hijack certain status conventions for their ends.??

For a premium brand, these three things are the conventions often used.

Cachet. ?Be associated with groups who have high status.? A suit from Savile Row has cachet because that’s where the British social elite have always bought. A suit from Paul Smith denotes another kind of aristocracy - rock and roll cachet.?

Signalling costs.? The object or experience should signal or imply that it was difficult to acquire.? It took resources - money, power, networks, intelligence - to get this thing or get through its doors.? Rationally, other conventions would do just as well.? But you meet your prospective client at a private club, not McDonalds.? You send a printed invitation to your wedding, not an email.???

Alibi.? ? High-status services or products need an alibi. We can’t quite admit this is about status-seeking, so we need a pretext. (To openly admit the desire for status-seeking would be refreshing but diminish your status).? Porsche drivers therefore bang on about engine quality and cornering.? Second homeowners will justify their purchase in terms of rescuing neglected properties and holidaying in this country. obscuring their actual status needs.

The journalist’s rule of thumb is ‘follow the money’. The social psychologist’s is ‘follow the prestige’. ???Jonathan Haidt.?

Thanks to Stripe Partners for highlighting David Marx’s work??

*Yes, Marx remains very observant about capitalism.