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Buying Brand Names: Good Move or Money Wasted?

Written by Ed Avis - 7 Comments

Buying Brand Names

My son and I were in the grocery store the other day looking for cereal. At 15, he’s a pretty savvy shopper, so he immediately directed my attention to a display of generic, bagged cereal instead of the brand name boxes.

On that particular trip we ended up buying Rice Chex, the real branded one, because that’s what he wanted and there was no generic equivalent. That being said, my experience with cereal is that the generics are usually just as tasty as the brand name.

But how often is that the case? I’m going to invite criticism from dedicated generic goods buyers by stating that the brand name is often, perhaps usually, worth the extra money.

There seems to be a subtle bias in some circles against brand name products, as if the companies that own the brands are somehow trying to rip off consumers. “I’m too smart to believe all that advertising,” these people sniff.

Well here’s the deal: Rarely does a major company — or a small company, for that matter — invest in advertising or other marketing for a product that can’t back it up. That’s because companies don’t want you to buy their product once; they want you to love their product, tell your friends about it, and buy it again and again. So they invest a lot of money developing a solid product before they invest in marketing. Advertising a product that doesn’t live up to the hype is a waste of marketing dollars.

Yes, sometimes the brand name disappoints. Everyone has a story about a brand name product that broke down — we have a Bosch oven that drives us crazy with its erratic performance — but in general the brand names deliver.

And generic items do disappoint, in my experience, much more frequently. That can of generic corn I bought the other day? The kernels were smaller, there seemed to be more water, and overall the flavor was less satisfying than the Green Giant brand. Yes, I saved a quarter, but it wasn’t worth it.

Why do we drink way more Coke than store-brand cola? Admit it, it’s because the former tastes better than the latter, in most people’s estimation. Yes, Coke’s non-stop advertising plays a big role, but the store-brand swill is usually positioned in the same aisle as Coke, so if it tasted better, you would buy it. But most people decide that the premium they pay for Coke is worth it.

The same goes for many other brands. The store-brand steak is often decent, but the Black Angus is consistently so. Off-brand sneakers from Pay-Less Shoes look fine, but if I’m running a marathon, I’m wearing Nikes. When we replaced the windows on the second floor of our hundred-year-old house, we went with Andersen; the previous owners went off-brand on the first floor, and those clunky windows still drive us crazy.

I’m going to go out further on my figurative limb and state that brand names play a bigger role in boosting consumer confidence today than at any time in the past, mainly because of the internet. Here’s why: In two hours I could launch a website promoting my own “brand,” let’s say Ed’s Dog Food. With the web templates available these days, my website would look pretty cool, maybe even as cool as a real brand-name dog food website.

But does the ability to create a slick website mean I know anything about dog food? Nope. A few daring consumers might be fooled by my site, but wouldn’t you rather buy your dog food from a company with an established brand? If you care about your dog, you would!

Some product categories are different. Produce, for example, rarely has a brand connection that matters — the head of lettuce sitting by itself tastes the same as the bag of shredded lettuce from Dole. I’m not particularly fashion conscious, as my wife will readily attest, so I routinely buy unbranded t-shirts, socks, and such (though not jeans). But in most cases, the brand name product is better.

There is a close connection between advertising and brands, and this, I suspect, makes some people suspicious. “If Tide was really better than other brands, they wouldn’t have to advertise!” the line goes. But this may be putting the cart before the horse — Tide was a solid product, so Proctor & Gamble promoted it. If it wasn’t a solid product, they would not have invested in the advertising to build the brand.

So the next time you’re in the grocery store and that box of Oreos beckons, go ahead and pay the extra 50 cents rather than buying the store-brand “chocolate cookie sandwiches.” Your taste buds will thank you!

Published on August 21st, 2012
Modified on September 4th, 2012 - 7 Comments
Filed under: Consumer, Frugality

About the author: is a writer and editor in Oak Park, Illinois. He specializes in personal finance, parenting, and small business topics. He is married and has two sons.

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7 Responses to “Buying Brand Names: Good Move or Money Wasted?”

  1. 1
    Kenijo Says:

    On the specific topic of cereal, I agree that the bagged cereal can be just as tasty as the brand names but on food especially you have to be careful on what is in it. I moved to the US from France 6 years ago and I’m shocked to find that food here has a very high level of sugar (which makes me understand why there is so much more diabetes in the US than in Europe).

    I bought a bag of no-brand cereal the other day and I couldn’t stand the sweetness of it. That said, it doesn’t mean that brand names are always better. In fact I found out that Safeway/Kroger/QFC brands for cereals (and other items too) are made with fewer, healthier ingredients.

    When it comes to food, don’t skimp on it to save a few extra bucks. You’re health is highly linked to what you eat. And you don’t have to go all organic to get healthy food!

  2. 2
    Lance @ Money Life and More Says:

    There are certain things we’ll buy brand name and others we’ll buy generic. We figure we’ll try the generics once and if they aren’t very good we go back to the brand name. It isn’t like just because we bought generic once we have to buy it forever.

  3. 3
    Chris Says:

    Some store brands really shine. In our regional Weis Market has outstanding frozen vegetables (often BETTER than the brand names) and has very good icecream. Their pasta and many other items are also indistinguishable from brand name products. I don’t feel bad buying most of their store brands because they really do shine. They have a few clunkers, but for the most part they are good products.

  4. 4
    Roger Says:

    The Walmart ‘ s own brand “Great-Value” is no good
    in its answer to the product cooking spray “PAM”
    We find it totally useless . We are back to using
    “PAM” !

  5. 5
    Kevin R Says:

    I am mixed in my name v. off-brands, often in the same product. Name brands do last longer, but often doing a cost benefit analysis, in some areas no-name comes out way ahead. Shoes, name brand usually last twice as long, but price is no-name can be a quarter as much, jeans are closer to even match in work-wear (excluding designer, thinking Carhartt and Levi last about four times Wrangler for four times cost). Food does taste different but your taste buds are actually trainable, so if ever get a Central American gram cracker or cookie, be prepared lack of sweetness you are expecting, even though it appears exactly the same. I tend to name brand foods on sale as a treat, except my soda, not wanting to get used to narrow options. I guess it depends on what it is if value or quality is the overriding concern for me. I think it foolish to only buy brand names, but maybe moving from frugal to outright cheap to base all decisions only on costs, sometimes functionality is well worth the price.

  6. 6
    Peter Says:

    I am a BIG cereal eater – one to two bowls a day. I went to bagged cereal about four years ago and it adds up to substantial savings, especially if I stock up on bagged cereals when they go on sale. If you put the generic and name-brand cereals side-by-side, then I think you would be able to tell a difference. Otherwise, bagged cereal is just as good.

    The other store-brand I find myself regularly buying is pasta, yogurt, cheese, and ice cream. I will occasionally buy store-brand frozen pizza.

    Otherwise, I’m all brand name from cleaning products to soda to canned or boxed foods.

  7. 7
    Steve Says:

    Everyone has a different list of what they will buy generic or not. I agree with Lance, in that you don’t lose much by trying the generic, at least for something you consume (use up) on a regular basis. I agree with Kevin as well – even though a name brand may be better, depending on what you are doing and how much better it is, it may not be worth paying for that level of quality. Again, it depends on how often you expect to purchase and use the item. If you are buying a car you will purchase it once and use it a lot, so it might be worth getting a “name brand.”

    Personally, I am fine with store brand soda and non-stick cooking spray, for instance. I enjoy most store brand cereals, though I haven’t found one that replicates Cheerios.

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