Maximizing vs. Satisficing Brands

Maximizing vs. Satisficing Brands

I have a confession to make: I used to eat a lot of fast food.

Wendy's. McDonald's. Chick-Fil-A. You name it. I ate it all.

There’s good news and bad news: The bad news is these decisions probably took years off my life. But the good news is they taught me a secret of marketing, which I’m going to share with you now. 

I attended college in North Carolina. On school breaks, we escaped campus and explored the South by car. We visited all the major cities within a 500-mile radius of our messy dorm rooms, from the quaint streets of Charleston, to the peach trees of Atlanta, to the country music bars of Nashville. The drives always felt longer than they actually were. As the conversations slowed to a silence, we could hear our bellies growling. After a couple hours on the road, we had to stop for food. By the time our hunger set in, our headlights illuminated the asphalt in front of us, and stars dotted the rural Southern skies. Hungry — yet eager to reach our destination safely — we always ate at a chain restaurant. The speed of fast food was a bonus, but we cared more about the predictability of it; ambiance mattered, but we cared more about clean bathrooms; healthy options were nice, but we cared more about avoiding food poisoning. 

I now realize that our restaurant decisions were driven by three ideas: (1) The Need for Common Agreement, (2) The Search for Safety, and (3) The “We Know it’s Going to Be There” Principle.

  1. The Need for Common Agreement: We never pulled off the highway before agreeing on a place to eat. Crucially, we always agreed on the chain that nobody in the car disliked, not the chain that one person in the car loved. We usually stopped at popular chains, such as McDonald's, where everybody already knew their order. Since we needed to reach a consensus, we optimized for “nobody is going to be mad about this decision,” not "this could be the best meal ever.”

  2. The Search for Safety: Part of the appeal of the major fast-food chains is the bright lighting, clean bathrooms, and knowing that you won’t leave with food poisoning. They sell predictability. Even in the worst parts of town, McDonald's is a safe place to be. McDonald's doesn’t just sell food. It sells cleanliness, reliability and a predictable menu that’s consistent from store to store. Rural Southern towns can feel dicey after the sun goes down. Since we were out of our element, we always prioritized safety. Even if we had already agreed upon a restaurant, if the lighting was dim and the restaurant didn’t look clean, we’d call an audible and choose another restaurant. 

  3. The “We Know It's Going to Be There” Principle: The fun of picking a restaurant always started with a conversation, not a Google search. Crucially, a restaurant suggestion would only be made if we assumed there was a location nearby. For example, we knew not to ask for Wawa south of the Mason Dixon Line or for Zaxby’s north of Georgia. Even if a location existed, it lacked density. In contrast, it felt like every highway exit led to a McDonalds. When we knew a chain was nearby, we were likely to suggest it. If not, it escaped our minds. 

On the road, these principles mattered more than the food itself.¹

Chain restaurants don’t just sell food. They sell cleanliness, predictability, and downside risk protection. In short, chain restaurants are Satisficing Brands, not Maximizing Brands. 


Maximizing Brands: Luxury Brands

Maximizers seek the very best. When we act as Maximizers, we strive for outsized success. 

We support Maximizing Brands when we’re outside of our regular routine. When it comes to wedding planning, or purchasing a high-end top coat, we pay hearty premiums to maximize the upside. Maximizing is why we pay exorbitant premiums for travel experiences, such as skydiving in Switzerland or climbing the Sydney Harbor Bridge in Australia. When people seek memorable, remarkable, or extravagant experiences, they become Maximizers. 

Luxury brands are iconic Maximizing Brands. Luxury brands thrive in areas of high social and geographic mobility. In these areas, where we meet lots of new people, we use luxury brands to signal success, prestige, and identity. As Rory Sutherland, the first person to distinguish Maximizing Brands from Satisficing Brands, wrote: 

"In China the luxury goods thing is very, very strong, firstly because large numbers of people are from out of town, secondly, often in China you don’t take people to your house — your status depends on the clothes you’re wearing, so luxury goods brands have a value in status terms to the Chinese that is far greater than it would be to most French people living in their ancestral home, for example. British Aristocrats don’t wear massive belts with “Moschino” on. No. If you’ve lived in the same house for 500 years, you don’t need to wear blingy clothes.”

Luxury brands are context-dependent. In small towns with low social mobility, where everybody already knows who you are, there's no need for luxury brands. In fact, your propensity to support luxury brands is directly proportionate to the geographic and social mobility of the environment around you. 

While luxury brands signal status and success, they represent a fraction of our purchasing decisions. Maximizing Brands dominate our attention, but not our wallets. 

Most of the time, we care more about avoiding catastrophe than maximizing upside. Enter… Satisficing Brands. 


Satisficing Brands: Fast Food Chains

When we talk about brands, we talk too much about Maximizing Brands and not enough about Satisficing Brands.

Most people over-estimate how much they maximize. Most of the time, we’re engaged in normal routine. We’re in normal places, doing normal things, and living a normal life. We have bills to pay, people to see, and commitments to honor. In mundane moments, which account for the majority of our lives, we don’t need something perfect. We just need something safe, simple, and reliable — a Satisficing Brand. 

We pay premiums for “better,” and also, “less likely to be terrible.” Most of the time, we want the safe option, not the best option. We choose the safe option with low variance over the risky option with high variance. We crave certainty. We fear the unknown. All else being equal, we prefer to avoid losses than acquire gains. We care more about “unlikely to be embarrassing” than “potentially the best thing I’ve ever done."

Satisficing Brands are more influential than we think. When we buy Satisficing Brands, we prioritize safety over perfection. Satisficing Brands aren’t sexy, so they escape our minds. Since they’re part of our daily routine, Satisficing Brands account for a disproportionate share of our purchasing decisions. 

Since our safe, mundane choices are made on auto-pilot, we tend to underestimate how often we merely care about satisfaction, and thus, how often we support Satisficing Brands. 

Pro-tip: Think more about Satisficing Brands, and you’ll instantly improve your understanding of branding and human behavior. 

If you’re craving a Wendy’s Chocolate Frosty, my favorite college dessert, treat yourself and call it “market research."

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Further Reading

  1. Mike Dariano’s short eBook is the best introduction to Rory Sutherland

  2. I wrote a shorter post on Rory Sutherland’s marketing secrets, which you can find here.

  3. Rory Sutherland has an e-Book called The Wiki Man.

Footnotes


¹ In New York, people eat pizza, not McDonalds. Regardless, the behavior is the same.