Defining “Brand Market Segregation”

In a lot of markets today, there exists what I call “Brand Market Segregation” (For the sake of this article I will be referring to it as “BMS”). Big contracts turn honest companies into money-crazy egomaniacs, which affect pricing of commercial products. Instead of defining it in my reviews all the time I created a word for this phenomena. I’m sure there is a more official term, but I’m not a business major so I’ll stick with just inventing acronyms. I know that RigCast may refer to BMS in the future, so this post is a reference as to what I’m talking about.

When I refer to BMS, I’m essentially talking about brand arrogance. Military sales are a good example of BMS. When a company hits the jackpot and signs a contract with the US military to sell them a product for an amount of time, they get a big bankroll. Imagine having a contract that guarantees you’ll get paid, so long as you keep producing your product. Like a salary for a business! This bankroll essentially dissolves the companies interest to appeal to the consumer market. In turn, the company typically drives up the cost of its consumer product line because hell, they are endorsed by the big dogs now which makes their product bigger, faster, and stronger! Just like stickers and big wings give Honda Civics more horsepower.

So long as the contract exists, the product will be considered a premium and the company is essentially invincible to the purchasing trends of the commercial market, allowing them to drive up the price. I call these premium companies “hypnotic brands,” as they pull in a huge crowd based on reputation alone, regardless of their product.

On the opposite side of BMS is the “practical brand” that doesn’t have a huge endorsement, and maintains a profit strictly through the commercial markets, competing with other practical brands and prices.

Mil-spec contracts are just an example, but BMS extends to professional technical fields as well (ie. tools to mechanics, and equipment to hospitals). Yep, you’ll see BMS in everything from mil-spec gear to sunglasses. Ever heard of Oakley? If there is a guaranteed market to be contracted, the individual consumer will be the one paying more. BMS doesn’t always necessarily exist on a large scale either. It can be a small contract that affects BMS ever so slightly as well.

Regardless of the magnitude of the impact, it still exists, therefore I feel obligated to define it and take it into consideration in my reviews.

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