The rise of unpronounceable brands
In a world of platforms, what makes a good brand name?
If you’re one of the roughly 200 million Amazon Prime members worldwide, chances are that you will begin your search for products on the platform. Oftentimes, under the label of “Amazon’s Choice” or similar credibility lender, you’ll encounter something like this:
IUGA and PHISOCKAT will often share the same recommendation box with more mainstream brands: Hanes, Jockey, and Danskin and others you’ve heard of are all interspersed somewhere on that search results page. But you’ll notice that in many categories the brands popping up are not meant to be pronounced.
Most of the brands we’re talking about here sell their products directly from manufacturers to consumers everywhere on a platform like Amazon. They don't really care much about Western branding. They have no radio jingle or podcast ad. They are particularly prolific across apparel, electronics, and household items, but no category is immune. You probably won’t be able to find them anywhere else except on the platform where you bought their products, but sometimes you may see the exact same item being sold by another brand whose name — seemingly composed of five or more random consonants — you also can’t pronounce.
Welcome to the emerging world of the unpronounceable brand. They don't have retail partners to take care of. They only use certain digital channels, where they’ll very aggressively target cohorts that are likely to convert. If they’re selling a widget that costs $5 and can acquire customers for $10, they can price that widget at some multiple of $15 and make a decent margin. That's the kind of hyper-optimization that works well for these types of brands, which can change up the landing page and brand name every month if they want to. That platform or third-party marketplace is probably their only sales channel, whereas a traditional brand may have multiple channels that require investment to get their desired results.
If you’re a traditional multi-channel brand, this is what you’re up against. How should you position yourself? Do you adjust your media mix in response? And should you create a long-term plan for operating on a platform like Amazon, where you’re forced to co-exist with these kinds of unutterable brands that work without the expense of physical retail stores or other off-platform forms of customer acquisition?
Emerging models
A brand’s name is the best proxy for product quality. Traditional brand names, especially in the US market, were once composed of short, active, and memorable words, like Bounty or Sharp, which were meant to be remembered, said, heard, or searched for. 1-800-FLOWERS, for example, is an actual brand name that still exists, even though the concept of picking up the phone and calling in a flower order may seem outdated.
The emerging consumer-to-manufacturer model is huge in China as a way to connect manufacturers directly to people who want to buy their products. While unpronounceable brands are one manifestation of this trend, there are some newer companies in the West experimenting with similar models. For example, there is Italic, which began as a subscription service that sources high-quality products that are manufactured in the same factories that produce very high-end luxury goods. A company like Italic is reinterpreting what it means to be a brand through quality, so its members know that they don’t need to do a ton of research into these high-end products they’re buying because they are guaranteed to be well-made.
It’s worth watching what’s happening in the marketplace and assessing whether these under-the-radar brands come with any implications for your specific brand or product line. Traditional brands may not be paying much attention to unpronounceable brands — or other problems on major e-commerce platforms — until it is too late.
The platform brand challenge
Traditional brands no longer have the luxury of not making themselves available on Amazon or similar large marketplace sites because that’s where many of the best consumers are going to look for their products first. Amazon says 74% of US consumers start their product searches on the platform, and there are some 153 million Amazon Prime members in the US. That’s nearly 60% of the country’s adult population.
The third-party marketplaces are likely just one of many channels that traditional brands play in, so their response to unpronounceable brands depends on what type of brand they are. If they aren’t seeing a significant volume of revenue from these platforms, they may not be paying much attention, but this isn’t just about the revenue: It's also about the overall impact on brand perception.
There’s another big issue worth noting here, specifically with Amazon: sketchy marketplace sellers, which can be particularly egregious for products in verticals prone to counterfeiting such as beauty. Consumers may buy what they think are brand-name products on the platform and receive lower-priced knock-offs in return from third-party sellers, leading to dissatisfied customers, one-star reviews, and damaged brand perception. While platforms like Amazon are recognizing and trying to expand ad sales among non-endemic brands while also getting better at quality control and designating official brand stores, consumers may not make that distinction, especially those who are heavily motivated by price. Brands need to be aware of this possibility and try to mitigate it if this is an issue for its products.
If a brand’s core audience buys everything else through a platform, the brand pretty much has to maintain some sort of presence there. But on the flip side, if you make garbage bags, are people really going to be buying branded garbage bags unless it's very clear that those are 10 times better quality than something else? There are so many products in some categories that it’s easy to inspire choice paralysis for consumers, who aren’t going to spend hours researching which toothpaste to buy. Sooner, rather than later, this may mean that you're going to have to start behaving more like unpronounceable commodity brands if you want to successfully play in that platform channel. DTC beauty brand Glossier’s founder and CEO Emily Weiss summed this challenge up perfectly:
“I think Amazon really solved buying, but it killed shopping in the process.”
How to respond?
While larger brands tend to focus more on working with platforms to ensure that their storefronts look good and perform well, smaller, nimbler brands should definitely consider the approach of the unpronounceable brand. It also depends on who's in charge of these aspects at the brand; if it's the proverbial intern on the e-commerce team, the brand may not have the right executive-level backing to give this the importance that it may deserve. But a dedicated internal team or partner helping the brand with marketplace strategy could ensure that there’s a cogent channel strategy and understanding of trade-offs.
In the past, we’ve talked about how many of our single-player processes are shifting to more of a multi-player model, but this is almost the reverse. Many unpronounceable brands are single player, with one channel representing the only place they sell, whereas traditional brands are more multiplayer, with many different sales channels. Is it wise for them to devote a lot of energy and resources to match a really tiny operation? Unfortunately, there are no good universal answers here.
One question
Are there unpronounceable brands in your category, and if so, do you have a specific strategy to compete with them?
Dig deeper
Thanks for reading,
Ana, Maja, and the Sparrow team
Enjoyed this piece? Share it, like it, and send us comments (you can reply to this email).
Who we are: Sparrow Advisers
We’re a results oriented management consultancy bringing deep operational expertise to solve strategic and tactical objectives of companies in and around the ad tech and mar tech space.
Our unique perspective rooted deeply in AdTech, MarTech, SaaS, media, entertainment, commerce, software, technology, and services allows us to accelerate your business from strategy to day-to-day execution.
Founded in 2015 by Ana and Maja Milicevic, principals & industry veterans who combined their product, strategy, sales, marketing, and company scaling chops and built the type of consultancy they wish existed when they were in operational roles at industry-leading adtech, martech, and software companies. Now a global team, Sparrow Advisers help solve the most pressing commercial challenges and connect all the necessary dots across people, process, and technology to simplify paths to revenue from strategic vision down to execution. We believe that expertise with fast-changing, emerging technologies at the crossroads of media, technology, creativity, innovation, and commerce are a differentiator and that every company should have access to wise Sherpas who’ve solved complex cross-sectional problems before. Contact us here.