Value brands vs. Cheap

We hear the words "value brand" all the time, but what does it really mean? Does it mean cheapest? No. Is it a commodity that is priced a few pennies below its competitors? Not always. Could it be an apartment priced $50/month more than the building next door? Could be. At the end of the day, value is in the eye of the beholder. What one person sees as a value alternative, others may see as too cheap, or too expensive The job of every good brand in these recessionary times, is to make their brand, an affordable value proposition for as many people as possible.

McDonald's advertisement reads - "$4 is stupid". A direct hit against Starbucks and its premium brand pricing model. Does that mean McDonald's is the value brand in the coffee business? Not really. In order for the customer to derive value they need to feel that they are getting something more than just caffeinated water. Starbucks goes the extra mile training their employees to add value by creating a sense of community, a welcoming environment. Employees are even trained to learn customers names. Has that ever happened to you at McDonald's? Probably not. Obviously in this economy price is a factor, but Starbucks and other great retailers have done a tremendous job of cutting costs, reducing prices but more importantly offering a customer centric experience to their customers. That is the ultimate value opportunity. At the end of the day people will pay more to hear their name.

At Signature Community, we always strive, to provide the highest level of service in our product class. We do that with the customer in mind every day. Some of the offerings have been tweaked in this economy, but the experience has stayed the same. A good safe home in a community you can be happy in. Week after week, the economy has made things tougher and tougher for Signature, and our residents. However, our employees impress our residents with true WOW experiences every week without failure.


The results show. Our resident retention rate this year will be close to 75% (approx 50% better than average). Referrals from existing residents is one of our main sales vehicles and market place brand recognition seems to have taken off this year.

We have never positioned ourselves as a luxury brand and we are definitely more focused on being a value brand, but not by way of offering the cheapest or lowest service levels. We are doing it by offering a quality product at a reasonable price then overlaying with the greatest service level our industry has ever seen. That to me is value!

Thanks for making it happen.
Nick