How Important Are Brands To You?

by Vered DeLeeuw · 18 comments

I’ll go ahead and admit it: Generally immune to brands, I drive a BMW. A 10-year-old model, and it’s the entry-level 325, but still, it’s a luxury brand with a luxury sticker price. I almost can’t help it (or can I?) – the Silicon Valley is filled with luxury cars, mostly German brands such as BMW, Mercedes and Audi. It’s almost the norm here, and my car certainly doesn’t stand out on the road. If anything, it stands out because it’s old. Most people replace their car every 3 years over here.

A few months ago, we went on a trip to Central California. Driving outside the Silicon Valley was a real eye-opener. My BMW seemed almost silly, out of place. No one was driving luxury cars and most people around us were driving American vehicles.

It wasn’t the first time my luxury car seemed out of place. A few years ago, driving in the Northern California Sierra right after a snowstorm, my rear-wheel-drive BMW seemed just as silly when the snow chains fell off the wheels and the car got stuck in a snowy road. Luckily, we were already at the ski resort, so we simply waited until the next morning to have it towed to a cleared road. But I remember looking at my car, stuck there in the snow, and at the all-wheel-drive non-luxury trucks surrounding it, and thinking, this expensive car is just as useless as a toy car here in the snow.

These experiences got me thinking. I like to say that I drive a BMW because it’s a “better” car. The engine is incredibly responsive, the steering is smooth, and the entire driving experience is a pleasure. Not to mention it has leather seats and seat warmers! I love my car, enjoy driving it very much, and believe it does provide a superior driving experience.

Having said that, when I chose to buy a luxury brand, I obviously paid a premium that had nothing to do with performance or quality, and everything to do with the name. So I paid extra for the brand name, and I keep paying extra each and every time I take this car for maintenance or repairs, each time I renew the insurance, and each time I fill the tank with premium gas. Because when you own a “luxury” brand, maintenance and insurance are more expensive too.

As someone who keeps claiming here on these virtual pages that I’m a financially savvy person, even dishing out advice on how one could become as financially savvy as I am, how can I agree to pay this type of premium? I wrote here how I feel that women should stop paying so much for designer shoes; expressed my dismay at fashion brands such as Abercrombie, who lure teens and their parents into paying outrageous prices for basic (albeit cool) clothing. And yet, when it comes to cars, I knowingly pay more for driving a luxury brand.

What do you think? Am I being a hypocrite when I claim to be financially savvy and responsible, yet choose to pay more for a luxury brand? Or do we all have an area where we indulge?

How do YOU feel about brands? Whether automobiles, clothing, appliances – do you have a “weak spot” where you agree to pay more for a certain brand, or are you immune to the lure of brand names?

Money Saving Tip: An incredibly effective way to save more is to reduce your monthly Internet and TV costs. Click here for the current AT&T DSL and U-VERSE promotion codes and promos and see if you can save more money every month from now on.

{ read the comments below or add one }

  • invoice says:

    I sometimes have a “weak” spot for branded merchandise. And more often than not, the brand name suggests the quality of the product.

  • jeri says:

    I too drive a BMW that is nearly 10 years old. I offer this to you…. I will probably be able to drive this car another 5 years or more without having to do major car repairs. Yes, the window regulators go out, costing quite a bit to replace, but the car is built well and if well maintained I think it will last longer than most American cars. I hope I haven’t offended American cars.

  • Marcus says:

    As the late, great John Maynard Keynes put it, “In The Long Run We are All Dead.” Saving money is for chumps.

  • Glenwood Johnson Jr says:

    Am of the same mind as some of the comments expressed. If the brand suits your needs and desires, not necessarily BECAUSE it’s that brand, but it matches YOU and YOUR VALUES, then it’s fine. I drive an a 12 year old Acura 3.0CL, bought it used while it was still in excellent condition. It’s now fully paid for, and while I do pay more for maintenance and insurance (only slightly on the insurance aspect), I KNOW what I’m getting from that brand. I’ve driven the brand since 1995, and both cars have been easy to maintain, good on mileage, comfortable, safe, and other than normal wear and tear items, well worth the $$, and I tend to be meticulous in keeping them up. Since I live close to work, shopping locations, exercise gym, etc, too much wear and tear is avoided, and it saves the environment from excess emissions. It would be less if the public transportation were efficient where I currently live, yet that is what it is.

    Cars seem to be one of those products that paying for certain brands is worth the trade-off of being frugal for being frugal’s sake, trading in every three years, churning $$ in finance charges, and staying slave to a car note. Agreed with earlier posts stating that about jeans also. I like KNOWING the quality associated with certain brands.

  • Kelsey says:

    I think for me, if I’m gonna spend a large amount for a new car I would want it to be a good investment but I’d shoot for a brand that I like also.

  • Randy Addison says:

    Well, actually there is nothing wrong with getting the things that has famous brands since you are sure of the quality. Instead of buying things without the respected brands and replace them after a few months or years because of deficiencies, just get the branded one to last for a long time.

  • Savvy Young Money says:

    Yes, the Sillicon Valley is such a bubble (in more ways the one at certain time points i guess). The way I see it is that sometimes if you buy a non-luxury brand car with all the same bells and whistles as the BMW you’ll probably have to pay just as much (less in repairs though). But if you really love your car and it’s what you’ve been working for, it’s ok to splurge if you can afford it.
    I agree with some other comments that value is key. it’s important to distinguish between good quality and just plain needless markups. A lot of companies make bank by using the concept of brand > quality and innovation.

  • MoneyIsTheRoot says:

    You live in California correct? I wouldn’t think that you deal with snow all too often. That being said, a 10 yr old BMW runs a tad better than most other brands after 10 years. I have an 2009 Audi A4 that I purchased brand new… I probably should have bought used, but an Audi handles much better than any previous GM car Ive owned, less recalls, and less problems.

  • retirebyforty says:

    I love our old ’98 BMW Z3… We got it used in ’01 and drove it until the engine blew last year, so sad…. Now we drive a Mazda 5, pretty boring, but we need more space. The one thing I hate about the Z3 was taking it in for maintenance. The bills are always ridiculous.

    I think brands are OK for certain products. If the product is superior, then I don’t mind paying for the brand. Usually I buy generic though.

  • KM says:

    I seem to have an aversion to name brands. There are some brands I refuse to buy (Mac or i anything, HP, Dell, Microsoft, etc) for various reasons, whether it’s because I think their products are crap or because I don’t want to be yet another person following the “it” trend of the day. Mostly, I just see brands as an addition to the price for “status,” which means nothing to me. I have no need to keep up with anyone and I would rather weigh my options and get something that’s perfect for me because of features, design, or other values, regardless of who makes it.

  • Rose says:

    I have to say sometimes being picky about brands is worth it. I recently bought a ‘second hand’ dictaphone on eBay, if I’d spent the same money for new on Amazon then I’d have got an unknown brand that I probably wouldn’t have happily trusted to record the interviews I need for my Uni project.
    My parents have only bought Renault cars for years because they knew the people running the garage so got a good deal and really liked the cars (the only car we had a problem with Renault fixed it for free). However recently the customer service has become much worse so my parents have said next time they need to buy a car they’ll look at other brands again and see what they can get for their money.

    If sticking with a brand makes you happy because you get good customer service and it’s a reliable brand (and you can afford it obviously) then I don’t see a problem with it, yes it would be nice if I could spend less money on shoes/boots but they’re always comfy and I can trust that they’ll last. 🙂

  • Dana says:

    I absolutely agree on the idea that some brands do indeed bring value and are worth the premium, while others don’t. An easy example from my own life is the brand of jeans I wear, a well-known mid-level brand with average prices in the $30-50 range. This brand always fits me well and is of good quality. Additionally, I hate shopping, so I appreciate that I rarely have to try on more than 2 pair to find something I like – so I find value in this brand. Many of the ultra-premium brands that sell for $100 or more, however, look horrible on me and I would never want to be seen in them – so, definitely zero brand value there for me, even though they’re in all the fashion mags.

  • vered says:

    Love your thoughts. Interesting ideas about getting value – OK to pay more for something if you get more value, and “value” includes pleasure.

    Oh, and Lynn – I have a feeling your baked goods are amazing. 🙂

  • Abedi says:

    I thought we spent wisely in order to have money to pay for the things we love. As you enjoy driving your BMW which is a great car, I see nothing wrong with your doing just that. The next time you go skeeing you could hike a lift (share the cost) and avoid your BMW getting stuck in the snow.

  • MoneyNing says:

    If there’s one thing I enjoy, it would be my car. There aren’t many things in our lives that we spend that much time in/with. For those who can afford buying a nice car AND don’t keep changing, I really don’t see a problem.

    If you love your car and you can afford it, then more power to you.

  • guest in ca says:

    I agree that it’s about value, and the reasons you went with the brand name. If I’m buying something just because of the brand name, when I could get a less expensive version that suits just as well, then that isn’t being frugal.

    But frugality & spending wisely isn’t always about going off-brand or lowest cost. If I’m buying the brand name or higher end version of something after due consideration of all the factors, and it’s what works for me, then it’s a valid decision for me.

    I’d say a BMW you’ve driven for 10 years has served you well, suited your needs (except for ski trips) & made you happy, so as long as you don’t mind & can afford the added upkeep costs it was a good decision for you – perhaps in retrospect not the best, but good enough. Anyone spending a lot of time in a car or planning to keep it a long time is well served by getting the best they can afford.

  • Wil says:

    To me it is all about value. Some name brand things bring that. Others do not. Vehicles happen to be one of those things that I never buy new. If a three year old BMW met my needs (and budget,) that is what I’d buy.

  • Lynn says:

    Why does it have to be a weak spot if it’s something you enjoy? Is it hurting you financially to own this car? Is there something you genuinely NEED (not just something practical) that you live without because of this car? Do you get enjoyment from owning and driving this vehicle? (You answered that one already.)

    I really dislike how splurging on something we truly take pleasure in is considered a “weak spot” or irresponsible, these days. 🙁

    As for me, I don’t really buy brand names, but if I wanted to, I’m sure I would. Oh, I suppose I do with baking chocolate… 😉

Leave a Comment