Beating to the Sound of a Great Brand

What Beats by Dre Teaches Us About The Power of Brand

An engineer recently did the world a favor and carefully deconstructed a pair the iconic Beats by Dre headphones that retail for $199 and up. His findings? The total cost in parts probably doesn't excede more than $16.89.

Image Credit: BuzzFeed

Worse, the product has some troubling reviews.

So, how does the company fetch such a high price for an item that isn't made from anything particularly substantial, that has had its production optimized to be as simple as possible?

Brand. The answer is in their brand. 

This is an excellent example of the power of branding. Beats by Dre is easily marketed as a power product because they have the endorsement of key players in the music industry, and bare the name of one of the most well-known American music artists to date.

One of the chief missions of a brand is to ensure consumers of the brand's quality. What could say "quality headphones" more than a headphone named after a successful artist - someone who truly knows music and lives a life of music appreciation?

Brands are also meant to be a focal point for community - to be a symbol and persona around which to build consumer loyalty. A function that Beats by Dre does well. The company grew by over a $1 billion dollars from 2010-2012 and by late 2013 accounted for over 50% of high-end headphone consumer purchases. Not bad!

Today, however, the company is owned by Apple, Inc.

There are two lessons here.

The first: the power of your brand elevates your worth - so much so - you can command a considerable upcharge for your product or service.

The second: in the digital age, anyone can hack your product and publish and expose. So use the power of your brand wisely!

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