A brand is a type of product manufactured by a particular company or service that it takes on an identity itself. Brands name can create and stand for loyalty, trust, faith, preciousness or mass market appeal, depending on how the brand is marketed advertised and promoted.
Premium brand is a brand that is positioned to have high quality and price. But price alone does not indicate a brand is a premium setting a high price for a low-quality product will only result in failure. Premium brands like Rolex, Cartier-Bresson, Louis Vuitton, Swarovski, Espressos, Gucci or Mercedes stand out because of their relative performance leadership and product specific basic an additional benefit.
Humans are basically status driven creatures because that is how evolution has shaped us. In the harsh nature, only way to survive and give rise to their offspring was to be in top of dominance hierarchy. One could be in top of hierarchy by their status among other members of the society. While the parameters that determine the status of an individual have changed, the evolutionary feature remains the same. In past the parameters used to be brawn strength and ability to survive. However today this has transitioned into bill strength and ability to provide .Right now we live in Liberal capitalistic world where the hierarchy is built on relative richness of individuals. This is where premium brands get in. Possession of a brand shows off the richness and the feeling that you are in top of the hierarchy. Someone having premium brand shows that they can afford and have no financial complications.
Next reason why premium brand sell is the factor of trust. Trust is rare and in the market of thousands of products, trusting a product is even more scarce. A premium brand creates a psychological sense of trustworthiness as a consequence of networking effect. If hundreds are buying it, then how could it be possibly wrong? Thus, people rarely risk their money to some unknown brands rather that trusting the brand used by many.
Let’s see a case of Gucci. On June 2021, they issued an auction of pajamas, which are almost same as kurtas worn in South Asia. The starting price of the pajamas was a whooping cost of four thousand dollars. It may certainly may not be worth it, but there are thousands of celebs who use and endorse Gucci , which makes a layman trust the brand. Also using the brand used by high professionals gives everyone a feeling of status rise. One jumps to top tier in the social viewpoint if they use the products of Gucci, no matter what that is. This is how any brand functions. Its all about status and trust.
World is right now in the race of premium brands. However, an individual must be rational and not trust any brand blindly. World has seen ample of brands failing the costumers and there is no certainty that they won’t in the future