What is ‘Brand Network Theory’?

May 8 2014

Brand Communities are not built on brand reputation (as one may wrongly assume), rather it is built on peoples’ understanding of brand stories. Being communities neither fixed nor permanent, its meaning and concreteness are always being negotiated by individuals. This is true whether group members interact electronically, face-to-face, or both. Motivations behind community participation and degree of involvement in the community may vary significantly.

We have identified at least three levels of community experience: Community of Consumption (frequent buyer = loyal), Brand Tribe (self-connected with a brand = Brand Advocate), Communities of Brands, people linked to a set of brands in different product categories.

We are in the middle of a transition process: from ‘Brand Communities’ to ‘Communities of Brands’.

After an extensive analysis, my research team concluded that despite the wide source of consumer insights both brand communities and social networks might provide, neither can be used to generate understanding and draw parallels between similar individuals. This is because demographic variables or the mere interest for a specific brand cannot be used as a proxy for people’s similarity.

For instance, in social networks like Facebook (FB), friends may be connected as they happened to live in the same town or go to the same school, but it does not necessarily mean they share similar passions in life. Members of brand communities such as Nutella have often one element in common ‘the brand Nutella’ but again, it does not imply that people are similar in any other way. 

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The idea of brand network, which is fundamental to the BrandMate application, is based on the assumption that both brands and people have their own specific personalities. Some of the brands people consume are the external representation of their inner personality. Consumers choose given brands over others for their ability to convey who they are. Although we tend to equate everything they love as a brand they love and wish to purchse (from singers to cities), there are infinite numbers of brands we consume merely for convenience (i.e. without emotional connections) and then there are ones they love but cannot afford to buy. Therefore, a distinction between those brands we use in our daily lives and those we are only passionate about is necessary (see Mari & Mandelli, 2011; Stegmuller, 2012).

The research team believes that motivation and affordability are two key factors in the brand selection process. In that respect, the study has shown that an individual pushing the FB ‘Like’ button have absolutely no value for companies, as affordability and motivation are not considered by users when clicking it – i.e. I use the brand X regularly and I have an emotional connection with it. The selection ‘Like’ might even come from referral or advertising, so not in complete independence.

We especially believe that groups of people regularly use similar clusters of brands (of different nature) to express themselves. Current technology allows the mapping of individual brand network and the definition of consumer clusters with similar brand consumption pattern. From this perspective it is possible to look at brands not just as single and independent entities but as brands linked to each other in networks.

This sophisticated but intuitive approach aims at successfully applying a consumer-based market segmentation using a combination of brands individuals consume.

We came to call this ‘brand-based segmentation’ and it requires re-focusing the attention on customer perspective and emotions.

Individual Brand Network -> Brand Consumption Pattern -> Brand-based Segmentation

Brand network theory says that by studying the brand preferences of a large group of individuals we can analyze clusters of similar individuals and create a segmentation based on those brands that define the characteristic of the individuals.

Alex Mari

Founder & Creative Director of BrandMate