Survey Says Amazon Offers Best Value

Discussion
Mar 15, 2011
George Anderson

Consumers
came
out of
the Great Recession looking
to get the most value
for their buck. When
it comes to ranking brands
that deliver on that requirement, Amazon.com
comes out on top in the U.S. and globally.

A new report by Millward Brown, Value-D:
balancing Desire and Price for brand success
, shows Amazon out well ahead
of its closest competitor in the U.S. (Crest) and internationally (Colgate).

"In the current economic climate many brands worry about their prices
being perceived as being too high, leading to lost business. Others are concerned
that prices are too low, leading to profit loss. What is needed is a balance
between the consumer’s desire for a brand and the price they are prepared
to pay for it," said Peter Walshe, global brandz director at Millward
Brown, in a press release.

Millward Brown’s research classifies brands by prices
tiers from cheap to more expensive. Less expensive brands that grade high for
cost may ultimately be perceived as a "poor value" if they are unable
to create a sense of "desire" on
the part of consumers. Scores over 100 (Amazon received a 157 from U.S. consumers)
are considered strong for delivering the right mix of desire and price.

"Too many brands fail to fully optimize their power and instead overemphasize
price and downplay desire. The consumer usually desires a brand first and then
considers the price to determine whether to purchase or not. Amazon.com has
mastered the art of being a trusted brand that consumers want to buy goods
from. Its pricing is perceived to be great value, but it is its brand power
that attracts customers in the first place," said Mr. Walshe.

Global top 10 Value-D brands



1. Amazon 146

2. Colgate 133

3. Nokia 128

4. Pampers 126

5. Visa 125

6. Coca-Cola 125

7. Microsoft 125 

8. McDonald’s 124 

9. Nescafé 120 

10. Lidl 118 



U.S. Top 10 Value-D Brands


  1. Amazon 157
  2. Crest 136
  3. Coca-Cola 134
  4. Folgers 133
  5. Bud Light 133
  6. Walmart 132
  7. Microsoft 131
  8. Colgate 130
  9. Dell 130
  10. HP 129

Source: Millward Brown

Indexed to average brand score of 100

Discussion Questions: What brands do you give highest marks to for delivering on price and desire? Why do you think Amazon received scores so much higher than other brands on both the domestic and international levels in the Millward Brown research?

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8 Comments on "Survey Says Amazon Offers Best Value"


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Dick Seesel
Guest
10 years 1 month ago

Amazon built its brand position on assortment and convenience, even more than pricing. At the same time, it put a stake in the ground that it was going to be highly competitive in its original business (books) and has continued to compete aggressively in other categories like electronics. It comes down to the definition of “value”–it’s not all about price. There may be other retailers (e-commerce or bricks and mortar) with lower prices than Amazon, but it’s hard to compete against the total package.

Bill Emerson
Guest
Bill Emerson
10 years 1 month ago

Price is objective (a number), value is subjective (an overall experience). All of the brands listed share a couple of attributes–they are predictable in the quality of the experience and they have a achieved a high level of awareness by solely marketing the experience and not the price.

Dan Frechtling
Guest
10 years 1 month ago
Amazon truly is in a class by itself, according to this study. It beats the competition on perceived value by wide margins. The average difference between Amazon and the number 2 brands is 17 points while the other brands on the list are only 1-2 points apart. Furthermore, only 4 out of 16 brands make both lists (Colgate, Coke, Microsoft) and only 4 out of 16 brands are retailers (Walmart, Lidl, Dell). Why does Amazon do so well? The methodology is one explanation. Richard is right about the definition of “value.” The Value-D score is calculated based on the gap between the consumer’s Desire for a brand and the consumer’s perception of the brand’s Price. A few observations: *As an e-commerce player, Amazon may score better than traditional retailers on “location.”*In a crowded space, it stands above alternatives on “brand.” *With a one-stop assortment and one-click purchasing (even on mobile phones), Amazon does well on “convenience” and “habit.” Finally, the scoring methodology doesn’t favor other consumer tech leaders. Apple lost points for high prices. Google… Read more »
Craig Sundstrom
Guest
10 years 1 month ago

Call me a cynic, but I can’t place much faith in a survey which nonchalantly compares a retailer (Amazon) with a manufacturer (Nokia) with a specifc brands of toothpaste (Crest, Colgate); sure you can argue they’re all rated on how good a job they do, but it’s still an apples to tennis balls to ice cubes comparison.

Ed Rosenbaum
Guest
10 years 1 month ago

I have to agree with the other comments about the validity of the survey when it selected the brands to be included.

I am a big fan of Amazon. More since they merged with Zappos. Both are known for high customer service grades at all times. Yes, price has to be a consideration. But not the main one.
Crest is an excellent product. The problem I find is it is dependent on someone at the store level filling the shelves. Walmart, you have a problem with this.

Back to Amazon. The books I ordered Wednesday evening were delivered yesterday as promised…and in good condition. They are always on target with what they promise. Others, take note.

Mark Burr
Guest
10 years 1 month ago

Interesting that examples such as Walmart and Amazon are considered brands in comparison to “Bud Light” and toothpaste?

I’m not sure that the study has much clarity with respect to brand.

“Consumers came out of the Great Recession…” Really? Are we out? It would be news to most in my region. Maybe in small regional pockets across the U.S. there may be signs of improvement. But, out of the recession? I don’t think so. Really?

Kai Clarke
Guest
10 years 1 month ago

This is very odd that in a survey like this, brands like “Apple” did not show up on any list. How “value” is truly measured is a deceptive term, since any holder of a “valuable” item will agree that the product performs better at the price paid, than other options. Despite all of this, there are many other locations and websites that truly stand out. One of them, Newegg, immediately comes to mind because it is both a price and a customer service leader. Its’ customers extol Newegg’s incredible customer service in all of their unaudited postings (on products), and their prices are also category leading. Despite all of this, and handling over $1 Billion dollars annually, they were not even mentioned. Surveys are often just another statistic like Mark Twain used to say; “There are lies, damn lies, and statistics….”

Odonna Mathews
Guest
Odonna Mathews
10 years 1 month ago

I, too, have to question this survey. I’d want to know why many brands in total were rated. Not that Amazon isn’t an amazing company, that seems to meet or exceed customer expectations.

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