Book SummaryHow Brands Grow, by Byron Sharp

1-Page Summary1-Page Book Summary of How Brands Grow

Everything you know about marketing may be wrong. In How Brands Grow, marketing professor Byron Sharp argues that many of the marketing principles commonly taught in business schools are unsubstantiated myths. By examining the real-world data that indicates which marketing techniques succeed and which fail, Sharp claims to have discovered a new set of empirical rules that directly contradict the widely-held “common sense” principles of marketing.

According to Sharp, most modern marketers believe you should:

• Work to retain your existing customers instead of seeking new customers.
• Tailor your marketing to the niche target market that’s most likely to buy your product.
• Give your customers a reason to choose you over your competitors by communicating to them how your brand is different and better.

However, Sharp asserts that you should do the opposite—we’ve consolidated his advice into these three rules:

• Focus on constantly attracting new customers instead of establishing a core group of loyal fans.
• Market to as many different demographics as possible—ideally, the whole human race.
• Focus on making your brand memorable instead of unique.

In short, Sharp argues that mass marketing—basic messaging about your brand for a general audience—is still the most effective way to grow, despite many marketing professionals declaring it “dead.”

(Shortform note: In a 2020 interview, Sharp claims that since the publication of How Brands Grow in 2010, the mainstream marketing world has fully embraced some of his ideas and resisted others. According to Sharp, large media companies like Facebook and Google were quick to echo his idea that brand growth comes...

How Brands Grow Summary Rule #1: Market to New Customers, Never to Existing Customers

Modern marketers often profess that it costs less to keep your existing customers than to attract new customers. Sharp explains that they believe this because it makes intuitive sense: If someone bought from your brand already, they’re more likely to buy from you again—they’re “your customer.”

Following this logic, your marketing is supposedly more effective on existing customers who are predisposed to spend a lot of money on your brand. For example, marketers may assume that it takes only one advertisement to convince an existing customer to purchase again, but five advertisements to convince a new customer to make a purchase. This makes the new customer five times more expensive to acquire.

However, Sharp insists that the data tells a different story: Marketing to existing customers is much less profitable than marketing to new customers.

Focus on Value Over Retention or Acquisition

Some argue that Sharp’s perspective on retention versus acquisition is a false dichotomy: You don’t need to choose one or the other to devise a cheap yet effective marketing strategy. Instead, marketers should focus on retaining or acquiring whichever customers are the most valuable,...

How Brands Grow Summary Rule #2: Market to Everyone, Never to a Specific Demographic

With Rule #1, we established that marketers profit the most from acquiring new customers instead of trying to make their existing customers more loyal. With Rule #2, we’ll see how most marketers fail to optimally market to new customers. (We’ll explore what Sharp thinks marketers should do instead a little later.)

Sharp states that when modern marketers try to acquire new customers, they typically identify a target demographic and tailor their marketing toward it. Sharp challenges this strategy, asserting that in most cases, it’s virtually impossible to boost your sales by tailoring your marketing to a specific demographic. On the contrary, targeting a niche is more likely to limit your reach. Instead, market to as many demographics as possible.

Early Adopters: A Demographic to Target?

In Purple Cow, Seth Godin opposes Sharp, arguing that you need to tailor your product to at least one demographic: early adopters, or those on the lookout for something new. Targeting early adopters is beneficial because they’re often the customers most willing to spend money...

How Brands Grow Summary Rule #3: Market to Be Memorable, Not Unique

If it’s impossible to find success by marketing to existing buyers or other specific demographics of consumers, what can marketers do to be more successful than their competitors? To answer this question, we’ll first explain how consumers decide which brand to buy, then we’ll show how marketers who understand this process can influence consumers to buy their brand more often.

How Consumers Choose Which Brand to Buy

Consumers Don’t Care About Branding

In Rule #2, we established that all competing brands sell to the same demographics, even when they target different demographics in their marketing. But why is this the case?

According to Sharp, targeted marketing fails because consumers don’t care enough about branding for it to impact their purchasing decisions. Customer surveys reveal that consumers typically perceive all brands in a category to be roughly interchangeable—when the differences between brands are slight, consumers fail to see differences at all. This is especially true for the intangible features of a brand: Only a small fraction of consumers ever think about a brand’s image or personality. Even if they do describe a brand as more “trendy“ or...

Shortform Exercise: Assess Your Brand Presence

Sharp argues that most marketers have a misguided view of their brand presence—they don’t accurately understand why their marketing is successful (or not). Assess your brand presence to gain a clearer idea on how well you’re doing and what you could be doing better.

Sharp argues that most marketers spend too much time worrying what customers think about their brand and not enough about how often customers think about their brand. How do you currently balance these two priorities? How could you shift your focus toward increasing the likelihood that your audience will think of your brand? (For example, imagine you run a seafood fast food franchise. Your advertisements may be too focused on positioning your brand as “fresher” than your burger-peddling competitors, and you should instead try to make them humorous and more memorable.)