Quality versus Price – Buying Brand Names or Generic Goods

pice vs quality dice

“Quality is remembered long after the price is forgotten.” ~ Ed Sabol

This quote seems clear at first glance, but the topic is far more nuanced than it appears. Most people have made decisions about price and quality, but they often follow up with qualifiers.

“Remember, son, you get what you pay for. Well, maybe not all the time… You’ve got to be careful. Ah, caveat emptor… just be smart with your money, okay?”

And in that seeming confusion, a gem of wisdom shines through:

  • Be smart with your money.

Price and Quality

When we zoom in further and consider individual purchases, should you generally spend more on name brands and quality versus cheaper generics? Does a higher price always mean higher quality? It should, right? Most people assume that price equals quality, but how true is this? According to the Association for Consumer Research:

“The price-quality linkage is inferential, i.e. there is no logical necessity that higher prices indicate higher quality; nor does current empirical evidence suggest a strong objective association.” – Carl Obermiller, University of Washington

It’s important to separate name brands from quality. While they often go hand-in-hand, they don’t always. Your rationale for trusting name brands should be considered carefully.

“Popularity is not an indication of quality.” – Vanna Bonta

Do you buy name brands because of a history of quality, or just for prestige? In either case, you’re getting something for your money. Many dismiss paying extra for prestige, but for many, it’s no laughing matter. In fact, it can often be taken very seriously.

Prestige

In business, we talk about “moments of truth.” For example, if you see a coffee stain on an airplane seat, your confidence in the airline—and in the safety of flying with them—could be shaken. That’s a negative moment of truth.

People instinctively know this. Let’s not belittle people’s desire to present positive moments of truth socially or professionally by displaying taste and intelligence through name brands. For a businesswoman, carrying an expensive purse might imply success and trust. For your teenage son, wearing Nikes might help him fit in and meet new friends, instead of wearing Walmart-brand sneakers. As shallow as it may sound, these moments of truth matter.

Conspicuous Consumption

On the other hand, we have the well-known societal issue of conspicuous consumption. This is when things go too far—fancy clothes, cars, and nights out, creating a culture that glorifies being rich and materialistic. This can give materialism a bad reputation, and rightly so. Over-materialism is an issue when it comes at the expense of more important, long-term survival values, and often without the means to afford such luxuries. These two issues—name brands and over-materialism—are related but distinct.

I still argue that name brand consumption and even displaying it have their proper place.

Would you feel smarter driving a Yugo or a Toyota? Even my word processor didn’t recognize the Yugo and tried to autocorrect it, while nearly everyone knows Toyota as one of the most dependable car brands. So yes, brand names do help guide our decisions.

There’s even an intellectual argument that we discover who we are through the products we buy. I’m not sure I would go that far, but it’s an interesting idea to consider!

Saving Money

Expensive items often come with claims of quality and prestige. But there’s also the argument that spending more upfront on something well-made and long-lasting actually saves you money in the long run. And the best part? You get to continue enjoying the item.

Some items are better off cheap, and some things matter more than others:

  • Discount garbage bags?
  • Discount gas?
  • Discount meat?
  • Discount legal advice?
  • Discount medical treatment?

Examples

Real-life examples help illustrate the point:

  • My last $120 pair of sneakers was comfortable and prestigious, but lasted only as long as my $20 pair.
  • My $200 skillet with seven layers of metal cooks evenly, works efficiently, and looks great hanging in my kitchen. It’s safe and non-toxic stainless steel and was a great deal when you consider that most people replace their cheap $20 cookware every two years, while the toxic Teflon surface wears off into your food, potentially causing health issues like infertility and cancer. More on that here.
  • I’ll never buy another Gateway computer. My daughter’s was sent back three times for new hard drives in the first year. They were wonderful about the warranty, but so what? My Compaq (made by HP) is still going strong after five years of daily use.

The complexity of this question may not rival rocket science, but it’s nuanced enough to explain the continued success of review agencies like Consumer Reports and other reputable reviewers.

And let’s be honest: We often turn to reviews for guidance. We all know we need the genuine experiences of others to help us with our price and quality calculations.

Think

The key ability we need—and the ability we want our kids to have—is not simply chasing after name brands blindly. It’s in their ability to make calculated decisions. The calculus includes:

  • Price
  • Current financial situation
  • The urgency of the purchase
  • Likely intangibles when comparing cheap and expensive products:
    • Comfort
    • Prestige
    • Warranty (if any)
    • How much we like the product (look, design, etc.)
    • Our probable enjoyment of the product
  • Tangibles when comparing:
    • How long will it last?
    • How well will it perform?

The human mind is remarkable—it can make all these calculations faster than I can even write about them! The problem arises when we mindlessly buy Brand X without thinking through the decision.

Systems

There’s a difference between Starbucks’ iced mocha (no whip) and the brown sugar-water for a dollar less at McDonald’s. Guess where I go when I need to write and get my coffee fix?

Thanks to modern business systems, our purchases are generally predictable and reliable. A McDonald’s cheeseburger tastes the same in Palm Bay, Florida, as it does in Beijing, China (though it might not be as bad for you overseas—a topic for another article about food colorings!).

The Can Opener

One of my favorite purchases was an expensive can opener.

When I was a young bachelor, I bought the cheapest one I could find—just over a dollar. It didn’t open cans properly.

I bought a slightly better one, but it left a jagged piece of aluminum that I had to keep out of my food. Frustrated, I bought the finest can opener I could find for $20. It worked beautifully and still does, even today. Just using it gives me a sense of well-being, and my cans open cleanly and quickly.

Had I spent money on cheap can openers over the years, I might have wasted more money and had less satisfaction. But could I have gone overboard? Could I have bought a gold-plated can opener? I don’t know—how much is it?

“Quality is never an accident; it is always the result of high intention, sincere effort, intelligent direction, and skillful execution; it represents the wise choice of many alternatives.” – William A. Foster

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