Sunday, June 7, 2009

Brand names as signaling

Mazda destroys 4703 new cars, worth about $100 million, to protect its brand name.
Mazda saw no easy way to guard against these outcomes. So it decided to destroy approximately $100 million worth of factory-new automobiles. "We couldn't run the risk of damaging the brand name that Mazda worked so hard over the years to develop," says Jeremy Barnes, the company's corporate-affairs director for North America.

(It is a bit old, but still a good example for why brand names matter.)

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