O Preco que a Marca Aguenta: Pricing Power

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TL;DR

O iPhone 11 Pro custava 40% mais que o OnePlus 7T Pro com especificacoes iguais ou superiores. A maioria dos compradores escolhia o iPhone. A Kantar BrandZ, analisando mais de 12.000 marcas em 20 anos, comprovou que marcas fortes cobram ate o dobro de concorrentes fracos. Binet e Field, com mais de 2.000 cases do IPA Databank, mostraram que promocao de preco aumenta sensibilidade ao preco. Construcao de marca reduz. Pricing power e o resultado financeiro mais direto do brand building. E a metrica que quase ninguem acompanha.

O telefone que custa mais e vende mais

Em 2019, a Apple lancou o iPhone 11 Pro por US$ 999. No mesmo periodo, a OnePlus lancou o 7T Pro por US$ 599. O OnePlus tinha mais armazenamento, mais RAM, tela maior. As avaliacoes dos usuarios eram identicas. Um custava 40% menos que o outro.

O iPhone dominou em todos os mercados onde os dois competiam.

O exemplo e da Kantar, que o usa para ilustrar um ponto que a maioria do mercado de marketing recusa aceitar: as pessoas pagam mais por marcas fortes. Pagam porque querem. E continuam pagando mesmo quando a alternativa mais barata e objetivamente equivalente.

Essa e a definicao operacional de pricing power. A capacidade de cobrar mais sem perder volume proporcional. A margem que uma marca extrai por ser quem e, por ser reconhecida, por ocupar um espaco mental que concorrentes com preco menor simplesmente nao ocupam.

Agora uma pergunta: quantas marcas que voce conhece acompanham pricing power como KPI? Quantos brand health trackers incluem essa metrica? Quantos decks de planejamento de marca mencionam a palavra "preco" fora da secao de trade?

A resposta geralmente e zero.

A crenca que o mercado se recusa a abandonar

O mercado de marketing opera com uma premissa implicita: marca e comunicacao. Marca e awareness. Marca e reconhecimento, preferencia, consideracao. Os trackers medem essas variaveis, os reports apresentam esses numeros, os KPIs de marca moram nesse territorio.

Preco e problema de trade. De revenue management. De finance. De qualquer departamento que nao seja o de marca.

Essa separacao e artificial. E custosa. Byron Sharp, no Ehrenberg-Bass Institute, documentou que marca forte e marca que o consumidor pensa e compra com facilidade. A dimensao "compra" inclui o preco que o consumidor aceita pagar. Quando alguem compra Coca-Cola a R$ 9 em vez de guarana a R$ 4, essa decisao e tao parte da forca da marca quanto o reconhecimento do logo vermelho.

Binet e Field, na analise de mais de 2.000 cases do IPA Effectiveness Databank, foram alem. Eles mediram os efeitos de longo prazo de campanhas de brand building versus campanhas de ativacao. Entre os efeitos documentados: campanhas de brand building reduzem a sensibilidade do consumidor ao preco. Campanhas de ativacao baseadas em promocao de preco aumentam essa sensibilidade.

"Mais de 2.000 cases falharam em identificar uma unica empresa que tenha fortalecido seu pricing power focando em clientes existentes." Les Binet, IPA Effectiveness Conference, 2024

O dado e preciso. Nenhum caso. Em 2.000 tentativas. Nenhuma marca conseguiu proteger sua capacidade de cobrar mais quando direcionou esforcos para reter clientes existentes em vez de alcancar novos consumidores. A construcao de pricing power exige alcance, exige que mais pessoas percebam a marca como valiosa. Fidelizacao nao resolve.

O que vinte anos de dados mostram

A Kantar BrandZ analisa mais de 12.000 marcas globais ha duas decadas. O banco de dados cruza percepcao de marca com dados comportamentais de compra. Os resultados sobre pricing power sao consistentes e contundentes.

Primeiro: marcas fortes cobram ate o dobro de concorrentes fracos na mesma categoria. Esse e o resultado agregado. Categorias especificas variam, mas a direcao e universal.

2x Marcas fortes cobram ate o dobro de concorrentes fracos
segundo 20 anos de dados da Kantar BrandZ com mais de 12.000 marcas

Segundo: o que permite a uma marca cobrar mais e a percepcao de diferenca significativa. A Kantar define isso como a combinacao de duas coisas: ser percebida como relevante (atende necessidades, gera afinidade) e ser percebida como diferente (unica, define tendencias na categoria). Relevancia sem diferenca e o preco de entrada. Todo competidor precisa ser relevante. Diferenca e o que permite cobrar premium.

Um estudo conduzido na Nova Zelandia integrou dados de brand equity da Kantar com dados comportamentais de compra de 810 membros do painel Flybuys, nas categorias de iogurte e comida para gatos. Consumidores que priorizavam marca sobre preco pagavam 11% mais na media. Quando a marca era percebida como significativamente diferente, o premium subia para 38%. Ate consumidores que declaravam priorizar preco pagavam 14% mais por marcas que percebiam como diferentes.

Esses numeros existem em um mercado com comparadores de preco em cada bolso, com Amazon, com hard discounters, com toda a infraestrutura digital que deveria ter eliminado premiums de marca. A infraestrutura existe. O premium persiste.

O mecanismo: como marca reduz sensibilidade ao preco

Daniel Kahneman, em Thinking, Fast and Slow (Farrar, Straus and Giroux, 2011), descreveu como o cerebro humano opera com dois sistemas. O Sistema 1 e rapido, automatico, intuitivo. O Sistema 2 e lento, deliberado, analitico. A maior parte das decisoes de compra ocorre no Sistema 1.

Marca forte ocupa o Sistema 1. Quando alguem ve um logo familiar, um ativo distintivo reconhecivel, o cerebro ativa associacoes aprendidas sem esforco consciente. Seguranca. Qualidade. Pertencimento. Essas associacoes criam um atalho de decisao que elimina a necessidade de comparar preco com atencao.

Antonio Damasio, neurologista portugues, documentou em Descartes' Error (Putnam, 1994) que emocoes participam de toda decisao, inclusive as que parecem puramente racionais. O "marcador somatico" de Damasio e um sinal emocional que o corpo envia antes que a mente consciente calcule. Quando uma marca gera um marcador somatico positivo, o consumidor sente que a escolha e certa antes de avaliar o preco.

Isso explica o iPhone. O comprador sente que e a escolha certa. O preco entra na decisao depois, e quando entra, entra filtrado por uma disposicao emocional que ja foi formada. O OnePlus pode ter especificacoes superiores. O calculo racional favorece o OnePlus. O cerebro humano favorece o iPhone.

Sharp e Romaniuk, no Ehrenberg-Bass, conectaram esse mecanismo ao conceito de disponibilidade mental. Marcas com forte disponibilidade mental sao lembradas em mais situacoes de compra. Ser lembrada e ser considerada. Ser considerada em primeiro e ter vantagem antes que o comparativo de preco comece. O consumidor que lembra da Coca-Cola primeiro compara preco com menos rigor do que o consumidor que lembra de tres marcas ao mesmo tempo.

A armadilha da promocao

Se pricing power e tao valioso, por que tantas marcas fazem exatamente o oposto? A resposta e pressao trimestral.

Sharp, em How Brands Grow (Oxford University Press, 2010), documentou o efeito de promocoes de preco sobre vendas de longo prazo. A conclusao: promocao gera pico temporario de vendas. Quando a promocao acaba, as vendas retornam ao patamar anterior. Em muitos casos, retornam para um patamar ligeiramente inferior, porque consumidores que compraram no preco promocional ajustaram sua referencia de preco para baixo.

Binet e Field confirmaram esse efeito com dados do IPA Databank. Campanhas com forte componente de promocao de preco aumentam vendas no curto prazo. No longo prazo, essas mesmas campanhas aumentam a sensibilidade do consumidor ao preco da marca. O consumidor aprende a esperar o desconto. Quando o desconto nao aparece, o consumidor compra outra coisa.

O ciclo e vicioso. A marca promociona para atingir meta trimestral. O consumidor aprende o padrao. Na proxima vez, espera a promocao. A marca precisa promocionar de novo. As margens caem. Com margens menores, o orcamento de inovacao e de marketing e cortado. Com menos investimento em marca, a disponibilidade mental enfraquece. Com disponibilidade mental mais fraca, o preco se torna o unico criterio de decisao. A marca vira commodity.

Grandes empresas de bens de consumo anunciam periodicamente que vao reduzir dependencia de promocoes. Meses depois, os mesmos relatorios mostram gastos promocionais iguais ou superiores. A pressao por vendas imediatas e mais forte que a disciplina estrategica.

O paradoxo da promocao de preco

Efeito imediato: vendas sobem. O trimestre parece melhor. O trade fica satisfeito.

Efeito de medio prazo: o consumidor ajusta sua referencia de preco para baixo. Passa a considerar o preco promocional como "o preco real" e o preco cheio como "caro demais".

Efeito de longo prazo: a marca perde pricing power. Margens caem. Orcamento de brand building e cortado. A marca entra em espiral descendente.

Dado do IPA Databank: promocao de preco e o unico tipo de ativacao que consistentemente aumenta sensibilidade ao preco no longo prazo. Todo outro tipo de ativacao (sampling, trial, experiencia) tem efeito neutro ou positivo.

Lindt: o case que ninguem cita em reuniao de preco

A Lindt entrou no ranking Kantar BrandZ de alimentos e bebidas em 2021. Desde entao, se tornou a marca de chocolate numero 1 em valor de marca no ranking. O preco das acoes da empresa multiplicou por 6 em 15 anos.

O posicionamento da Lindt e construido sobre uma unica ideia: mestre chocolatier. O produto e posicionado como "mimo" ocasional, um pequeno luxo, com ingredientes de qualidade. A comunicacao e consistente ha decadas. O preco e substancialmente superior a marcas mainstream e a varias marcas premium.

O consumidor aceita pagar mais porque percebe a Lindt como significativamente diferente. A marca construiu associacoes de qualidade artesanal, de indulgencia merecida, de presenteabilidade. Essas associacoes criam um espaco de preco protegido. Concorrentes que tentam competir por preco com a Lindt estao competindo em um jogo diferente do que a Lindt joga.

O dado relevante: a Lindt tem pontuacoes de percepcao de diferenca significativa muito acima do que o tamanho de sua marca justificaria. A marca investe consistentemente em construir essas percepcoes, e essas percepcoes sustentam um ponto de preco que multiplica valor para o acionista.

Churchill vs. Privilege: o mesmo preco, resultados diferentes

O caso documentado pelo IPA Awards e instrutivo. A Direct Line Group opera duas marcas de seguros no Reino Unido: Churchill e Privilege. As duas competem no mercado de seguros, uma das poucas categorias onde mais consumidores declaram escolher por preco do que por marca.

Quando consumidores usam sites de comparacao de preco, mais consumidores escolhem Churchill mesmo quando o ranking de preco e identico ao da Privilege. A unica diferenca mensuravel: Churchill teve 20 vezes mais investimento em comunicacao above-the-line do que Privilege ao longo dos anos.

O investimento em marca criou familiaridade. Familiaridade criou sensacao de seguranca. Em uma categoria onde o consumidor precisa confiar que a empresa vai pagar a indenizacao quando necessario, a marca mais familiar vence, mesmo pelo mesmo preco. E pelo mesmo preco, a marca com mais investimento em brand building gera mais volume, mais market share, mais valor.

Se Churchill decidisse cobrar 5% a mais, a diferenca de volume provavelmente seria minima. Essa e a definicao pratica de pricing power: a capacidade de aumentar preco com perda desproporcional pequena de volume.

O lucro escondido em 1%

Existe uma assimetria financeira que executivos de marketing raramente articulam com clareza: o impacto de 1% de aumento de preco sobre o lucro e muito maior que o impacto de 1% de aumento de volume.

A logica e simples. Volume adicional carrega custos adicionais: producao, distribuicao, materia-prima. Preco adicional, com volume constante, vai direto para a margem. Em empresas de bens de consumo com margens operacionais de 10-15%, um aumento de 1% no preco pode representar 7-10% de aumento no lucro operacional. O mesmo 1% em volume representa menos de 1% de aumento no lucro, porque cada unidade adicional tem custo marginal.

Isso muda a equacao de investimento em marca completamente. Se brand building protege e expande pricing power, e se pricing power tem multiplicador de lucro superior ao de volume, entao o retorno financeiro do investimento em marca e sistematicamente subestimado quando medido apenas por volume e market share.

7-10x O lucro gerado por 1% de aumento de preco pode ser 7 a 10 vezes maior
que o lucro gerado por 1% de aumento de volume, em bens de consumo

O que isso muda para quem toma decisao de marca

Auditoria de pricing power: 6 perguntas

Sua marca acompanha pricing power como KPI recorrente? Se a resposta e nao, o indicador mais importante de saude financeira de longo prazo esta ausente do seu dashboard.
Qual e a percepcao de diferenca significativa da sua marca versus concorrentes? A Kantar mede isso por Meaningful Difference. Se voce usa outro tracker, a pergunta e: seus consumidores conseguem articular por que sua marca e diferente?
Quanto do seu orcamento de marketing vai para promocao de preco? Todo real investido em promocao de preco reduz pricing power no longo prazo. Todo real investido em brand building protege ou expande pricing power. A divisao do orcamento entre os dois e uma decisao sobre o futuro da sua margem.
Quando foi a ultima vez que sua marca aumentou preco sem perda relevante de volume? Se nao aconteceu nos ultimos dois anos, ha um problema de pricing power que nenhum aumento de awareness vai resolver.
Suas campanhas de marca sao avaliadas pelo efeito sobre sensibilidade ao preco? Binet e Field mostraram que nem toda campanha reduz sensibilidade. As que funcionam enfatizam o valor funcional, emocional e social da marca na vida do consumidor.
Seu CFO sabe que brand building protege margem? Se a conversa entre marketing e finance acontece apenas em termos de volume e awareness, a contribuicao real do investimento em marca esta invisivel para quem controla o orcamento.

Warren Buffett descreveu pricing power como "a decisao de negocios mais importante que existe". Se voce pode aumentar preco sem perder volume, voce tem um negocio. Se nao pode, precisa rezar para sua estrutura de custo ser a mais baixa do mercado.

Marca e o ativo que cria pricing power. Comunicacao consistente, alcance amplo, percepcao de diferenca significativa. Esses elementos constroem, ao longo de anos, a disposicao do consumidor de pagar mais pela sua marca sem questionar com rigor. Preco e decisao de marca, e a metrica de preco e a unica que conecta o investimento em branding diretamente ao resultado financeiro.

Quem mede marca so por awareness esta medindo o termometro enquanto ignora o pulso.

Referencias

Livros

Sharp, Byron. How Brands Grow: What Marketers Don't Know. Oxford University Press, 2010.
Romaniuk, Jenni & Sharp, Byron. How Brands Grow: Part 2. Oxford University Press, 2015.
Binet, Les & Field, Peter. The Long and the Short of It: Balancing Short and Long-Term Marketing Strategies. IPA, 2013.
Binet, Les & Field, Peter. Effectiveness in Context: A Manual for Brand Building. IPA, 2018.
Kahneman, Daniel. Thinking, Fast and Slow. Farrar, Straus and Giroux, 2011.
Damasio, Antonio. Descartes' Error: Emotion, Reason, and the Human Brain. Putnam, 1994.
Ariely, Dan. Predictably Irrational. Harper Perennial, 2008.

Artigos e Estudos

Kantar BrandZ. "Global Brand Equity Study: Pricing Power Analysis." 20 anos de dados, 12.000+ marcas, 2005-2025.
Kantar. "Pricing Power is a Brand's Greatest Asset." Kantar Insights, 2024.
Kantar Brasil. "Como a construcao de marca ajuda o poder de precificacao." Kantar BrandZ, 2025.
Binet, Les. "Long-term brand building plus creative advertising is the key to firmer pricing." Marketing Week, 2024.
IPA Awards Paper. "Direct Line Group: They went short. We went long." WARC, 2019.
Ehrenberg, A.S.C., Goodhardt, G.J. & Barwise, T.P. "Double Jeopardy Revisited." Journal of Marketing, 54(3), 1990.

Fontes de Industria

IPA Effectiveness Databank. 2.000+ cases analisados por Binet & Field, 1998-2024.
Ehrenberg-Bass Institute for Marketing Science. University of South Australia.
Lindt & Sprungli. Annual Report 2024. lindt-spruengli.com.

Diego Isaac

Estrategista de marcas com +10 anos na intersecao entre ciencia de marca, comportamento do consumidor e comunicacao.

diegoisaac.com.br

Beyond Advertising

TL;DR

The iPhone 11 Pro cost 40% more than the OnePlus 7T Pro with equal or superior specs. Most buyers chose the iPhone. Kantar BrandZ, analyzing over 12,000 brands across 20 years, proved that strong brands charge up to twice as much as weaker competitors. Binet and Field, with over 2,000 IPA Databank cases, showed that price promotion increases price sensitivity. Brand building reduces it. Pricing power is the most direct financial outcome of brand building. And it is the metric almost nobody tracks.

The phone that costs more and sells more

In 2019, Apple launched the iPhone 11 Pro at $999. In the same period, OnePlus launched the 7T Pro at $599. The OnePlus had more storage, more RAM, a bigger screen. User ratings were identical. One cost 40% less than the other.

The iPhone dominated in every market where the two competed.

The example comes from Kantar, which uses it to illustrate a point that most of the marketing industry refuses to accept: people pay more for strong brands. They pay because they want to. They keep paying even when the cheaper alternative is objectively equivalent.

This is the operational definition of pricing power. The ability to charge more without proportional volume loss. The margin a brand extracts by being who it is, by being recognized, by occupying a mental space that cheaper competitors simply do not occupy.

Now a question: how many brands you know track pricing power as a KPI? How many brand health trackers include this metric? How many brand planning decks mention the word "price" outside of the trade section?

The answer is usually zero.

The belief the market refuses to drop

The marketing industry operates with an implicit premise: brand is communication. Brand is awareness. Brand is recognition, preference, consideration. Trackers measure these variables, reports present these numbers, brand KPIs live in this territory.

Price is a problem for trade. For revenue management. For finance. For any department that is not the brand team.

This separation is artificial. And expensive. Byron Sharp, at the Ehrenberg-Bass Institute, documented that a strong brand is one consumers think of and buy with ease. The "buy" dimension includes the price the consumer is willing to pay. When someone buys Coca-Cola for $3 instead of a generic cola for $1.50, that decision is as much a part of brand strength as recognizing the red logo.

Binet and Field, analyzing over 2,000 cases from the IPA Effectiveness Databank, went further. They measured the long-term effects of brand building campaigns versus activation campaigns. Among the documented effects: brand building campaigns reduce consumer sensitivity to price. Activation campaigns based on price promotion increase that sensitivity.

"More than 2,000 case studies have failed to identify a single company that has strengthened its pricing power by targeting existing customers." Les Binet, IPA Effectiveness Conference, 2024

The figure is precise. Not one case. In 2,000 attempts. No brand managed to protect its ability to charge more when it directed efforts toward retaining existing customers instead of reaching new consumers. Building pricing power requires reach, requires more people perceiving the brand as valuable. Loyalty programs do not solve this.

What twenty years of data show

Kantar BrandZ has analyzed over 12,000 global brands for two decades. The database cross-references brand perception with behavioral purchase data. The pricing power results are consistent and stark.

First: strong brands charge up to twice as much as weak competitors in the same category. This is the aggregate result. Specific categories vary, but the direction is universal.

2x Strong brands charge up to twice as much as weak competitors
according to 20 years of Kantar BrandZ data across 12,000+ brands

Second: what allows a brand to charge more is the perception of meaningful difference. Kantar defines this as the combination of two things: being perceived as relevant (meets needs, generates affinity) and being perceived as different (unique, sets trends in the category). Relevance without difference is the price of entry. Every competitor needs to be relevant. Difference is what allows a premium.

A study conducted in New Zealand integrated Kantar brand equity data with behavioral purchase data from 810 members of the Flybuys panel, in yogurt and cat food categories. Consumers who prioritized brand over price paid 11% more on average. When the brand was perceived as meaningfully different, the premium rose to 38%. Even consumers who declared price as their priority paid 14% more for brands they perceived as different.

These numbers exist in a market with price comparison tools in every pocket, with Amazon, with hard discounters, with all the digital infrastructure that should have eliminated brand premiums. The infrastructure exists. The premium persists.

The mechanism: how brand reduces price sensitivity

Daniel Kahneman, in Thinking, Fast and Slow (Farrar, Straus and Giroux, 2011), described how the human brain operates with two systems. System 1 is fast, automatic, intuitive. System 2 is slow, deliberate, analytical. Most purchase decisions happen in System 1.

A strong brand occupies System 1. When someone sees a familiar logo, a recognizable distinctive asset, the brain activates learned associations without conscious effort. Safety. Quality. Belonging. These associations create a decision shortcut that eliminates the need to compare prices with attention.

Antonio Damasio, the Portuguese neuroscientist, documented in Descartes' Error (Putnam, 1994) that emotions participate in every decision, including those that seem purely rational. Damasio's "somatic marker" is an emotional signal the body sends before the conscious mind calculates. When a brand generates a positive somatic marker, the consumer feels the choice is right before evaluating the price.

This explains the iPhone. The buyer feels it is the right choice. Price enters the decision later, and when it does, it enters filtered by an emotional disposition that has already formed. The OnePlus may have superior specs. Rational calculation favors the OnePlus. The human brain favors the iPhone.

Sharp and Romaniuk, at Ehrenberg-Bass, connected this mechanism to the concept of mental availability. Brands with strong mental availability are remembered in more buying situations. Being remembered is being considered. Being considered first means having an advantage before the price comparison begins. The consumer who remembers Coca-Cola first compares price with less rigor than the consumer who recalls three brands simultaneously.

The promotion trap

If pricing power is so valuable, why do so many brands do exactly the opposite? The answer is quarterly pressure.

Sharp, in How Brands Grow (Oxford University Press, 2010), documented the effect of price promotions on long-term sales. The conclusion: promotion generates a temporary sales spike. When the promotion ends, sales return to their prior level. In many cases, they return to a slightly lower level, because consumers who bought at the promotional price adjusted their price reference downward.

Binet and Field confirmed this effect with IPA Databank data. Campaigns with a strong price promotion component increase short-term sales. In the long term, those same campaigns increase consumer sensitivity to the brand's price. The consumer learns to wait for the discount. When the discount doesn't appear, the consumer buys something else.

The cycle is vicious. The brand promotes to hit the quarterly target. The consumer learns the pattern. Next time, they wait for the promotion. The brand needs to promote again. Margins fall. With lower margins, innovation and marketing budgets get cut. With less brand investment, mental availability weakens. With weaker mental availability, price becomes the only decision criterion. The brand becomes a commodity.

Major consumer goods companies periodically announce they will reduce promotion dependency. Months later, the same reports show promotional spending equal to or higher than before. The pressure for immediate sales is stronger than strategic discipline.

The price promotion paradox

Immediate effect: sales go up. The quarter looks better. Trade is satisfied.

Medium-term effect: the consumer adjusts their price reference downward. They start considering the promotional price as "the real price" and the full price as "too expensive."

Long-term effect: the brand loses pricing power. Margins fall. Brand building budget gets cut. The brand enters a downward spiral.

IPA Databank data: price promotion is the only type of activation that consistently increases price sensitivity in the long term. Every other activation type (sampling, trial, experience) has a neutral or positive effect.

Lindt: the case nobody cites in pricing meetings

Lindt entered the Kantar BrandZ food and beverage ranking in 2021. Since then, it became the number 1 chocolate brand by brand value in the ranking. The company's stock price multiplied by 6 over 15 years.

Lindt's positioning is built on a single idea: master chocolatier. The product is positioned as an occasional treat, a small luxury, with quality ingredients. Communication has been consistent for decades. The price is substantially higher than mainstream brands and several premium brands.

Consumers accept paying more because they perceive Lindt as meaningfully different. The brand built associations of artisanal quality, of earned indulgence, of giftability. These associations create a protected price space. Competitors trying to compete on price with Lindt are playing a different game than the one Lindt plays.

The relevant data: Lindt scores on meaningful difference perception well above what the size of the brand would justify. The brand consistently invests in building those perceptions, and those perceptions sustain a price point that multiplies shareholder value.

Churchill vs. Privilege: same price, different outcomes

The IPA Awards case is instructive. Direct Line Group operates two insurance brands in the UK: Churchill and Privilege. Both compete in the insurance market, one of the few categories where more consumers claim to choose on price than on brand.

When consumers use price comparison websites, more consumers choose Churchill even when the price ranking is identical to Privilege's. The only measurable difference: Churchill had 20 times more above-the-line communication investment than Privilege over the years.

Brand investment created familiarity. Familiarity created a feeling of safety. In a category where the consumer needs to trust that the company will pay out when needed, the more familiar brand wins, even at the same price. And at the same price, the brand with more brand building investment generates more volume, more market share, more value.

If Churchill decided to charge 5% more, the volume difference would likely be minimal. That is the practical definition of pricing power: the ability to increase price with disproportionately small volume loss.

The profit hidden in 1%

There is a financial asymmetry that marketing executives rarely articulate clearly: the impact of a 1% price increase on profit is far greater than the impact of a 1% volume increase.

The logic is simple. Additional volume carries additional costs: production, distribution, raw materials. Additional price, with constant volume, goes straight to the margin. In consumer goods companies with 10-15% operating margins, a 1% price increase can mean a 7-10% increase in operating profit. The same 1% in volume means less than 1% profit increase, because each additional unit has marginal cost.

This changes the brand investment equation completely. If brand building protects and expands pricing power, and if pricing power has a superior profit multiplier to volume, then the financial return on brand investment is systematically underestimated when measured only by volume and market share.

7-10x The profit generated by a 1% price increase can be 7 to 10 times greater
than the profit from a 1% volume increase, in consumer goods

What this changes for brand decision-makers

Pricing power audit: 6 questions

Does your brand track pricing power as a recurring KPI? If the answer is no, the most important long-term financial health indicator is missing from your dashboard.
What is your brand's perceived meaningful difference versus competitors? Kantar measures this through Meaningful Difference. If you use a different tracker, the question is: can your consumers articulate why your brand is different?
How much of your marketing budget goes to price promotion? Every dollar invested in price promotion reduces long-term pricing power. Every dollar invested in brand building protects or expands pricing power. The split between the two is a decision about your margin's future.
When was the last time your brand raised price without meaningful volume loss? If it hasn't happened in the last two years, there is a pricing power problem that no awareness increase will solve.
Are your brand campaigns evaluated for their effect on price sensitivity? Binet and Field showed that not every campaign reduces sensitivity. The ones that work emphasize the brand's functional, emotional, and social value in the consumer's life.
Does your CFO know that brand building protects margin? If the conversation between marketing and finance happens only in terms of volume and awareness, the real contribution of brand investment is invisible to whoever controls the budget.

Warren Buffett described pricing power as "the single most important business decision." If you can raise price without losing volume, you have a business. If you cannot, you need to pray your cost structure is the lowest in the market.

Brand is the asset that creates pricing power. Consistent communication, broad reach, perception of meaningful difference. These elements build, over years, the consumer's willingness to pay more for your brand without rigorous questioning. Price is a brand decision, and the price metric is the only one that connects branding investment directly to financial results.

Whoever measures brand only by awareness is reading the thermometer while ignoring the pulse.

References

Books

Sharp, Byron. How Brands Grow: What Marketers Don't Know. Oxford University Press, 2010.
Romaniuk, Jenni & Sharp, Byron. How Brands Grow: Part 2. Oxford University Press, 2015.
Binet, Les & Field, Peter. The Long and the Short of It: Balancing Short and Long-Term Marketing Strategies. IPA, 2013.
Binet, Les & Field, Peter. Effectiveness in Context: A Manual for Brand Building. IPA, 2018.
Kahneman, Daniel. Thinking, Fast and Slow. Farrar, Straus and Giroux, 2011.
Damasio, Antonio. Descartes' Error: Emotion, Reason, and the Human Brain. Putnam, 1994.
Ariely, Dan. Predictably Irrational. Harper Perennial, 2008.

Articles and Studies

Kantar BrandZ. "Global Brand Equity Study: Pricing Power Analysis." 20 years of data, 12,000+ brands, 2005-2025.
Kantar. "Pricing Power is a Brand's Greatest Asset." Kantar Insights, 2024.
Kantar Brasil. "Como a construcao de marca ajuda o poder de precificacao." Kantar BrandZ, 2025.
Binet, Les. "Long-term brand building plus creative advertising is the key to firmer pricing." Marketing Week, 2024.
IPA Awards Paper. "Direct Line Group: They went short. We went long." WARC, 2019.
Ehrenberg, A.S.C., Goodhardt, G.J. & Barwise, T.P. "Double Jeopardy Revisited." Journal of Marketing, 54(3), 1990.

Industry Sources

IPA Effectiveness Databank. 2,000+ cases analyzed by Binet & Field, 1998-2024.
Ehrenberg-Bass Institute for Marketing Science. University of South Australia.
Lindt & Sprungli. Annual Report 2024. lindt-spruengli.com.

Diego Isaac

Brand strategist with 10+ years at the intersection of brand science, consumer behaviour, and communication.

diegoisaac.com.br