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Big Brands Have Become Liabilities

In the sea of food pictures your friends post on Instagram, how many McDonald’s Big Macs have you seen? How many Starbucks cups, Sheraton Hotel lobbies or Budweiser beers?

Perhaps a few. But, in general, mainstream brands are dramatically under-represented in social media—a fact that illustrates a big challenge facing mass consumer brands.

People use consumer brands to express themselves and tell stories about who they are and what they are proud of. This self-expression via consumption is more true today than ever before thanks to social media, which thrives off people sharing what they’re doing, eating and wearing.

But big brands simply aren’t as suited to this new reality, and as a result, they’re increasingly vulnerable to competition from smaller companies. These smaller brands are more efficient at helping consumers define themselves for a few key reasons.

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But I do think it is possible for the consumer behemoths to evolve. I have heard some of the major hotel companies are considering new unbranded hotels and even becoming a management service layer for Airbnb hosts. That seems like a reasonable strategy—taking advantage of their scale on the back-end of their business, but still providing consumers with the unbundled experience they want on the front-end. Some beer companies are doing something similar, buying up micro-brands and figuring out how to couple their back-end distribution might with the valuable front-facing smaller brands.

In the end, however, it’s clear that the era of “cool” big company brands is structurally over.

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Ethan Kurzweil, Tien Tzuo and 4 others commented on this article.
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The information available to a consumer about non-mass-brands is frequently better than the information about bigger brands. That’s because fans of small brands are more invested and more willing to spend the time sharing quality views and opinions.