Search

Does Your Brand Have Currency?

Similar to the exchange rate of world currencies, there are several factors that will cause a brand's currency to fluctuate. The three economic conditions that I would consider beyond "supply and demand" are trust, utility, and the gold standard.




Trust

The premise of fiat money is that it is backed by the reserves of a government or some other trusted entity. Printed on all U.S. currency is the sentiment "In God We Trust." In the world of emerging cryptocurrency, it's more like in Facebook, Calibra, the Libra Association, the Libra Network, and the Public Blockchain we trust. That's a lot of trust.


Libra is clearly banking on the Facebook brand currency to propel itself as an acceptable global currency. Traveling in Moscow, Russia, I discovered the ubiquitous Apple Pay. I must say it is quite convenient and it has certainly changed my perspective on near frequency communication (NFC) devices. Brands that carry currency can clearly influence the adoption of new technology.


Utility (Value)

Currency must have utility to have value. My father always used to say "make yourself useful." I think I now understand why. The more widely accepted and useful your brand is, the more perceived value it gains.


Gold Standard (vs. Fiat Money)

On August 15, 1971, U.S. President Richard Nixon announced that the United States would go off the gold standard. U.S. currency was once backed by gold reserves, a rare earth metal. Eventually, the United States could no longer back its currency with gold reserves. According to Rowlatt, gold has no intrinsic value, it simply has value because society has given it value.


Conclusion

So how exactly does a brand achieve an arbitrary gold standard? Brands build currency by building trust and increasing utility.



Sources: Rowlatt, J. (2013, December 08). Why do we value gold? Retrieved July 18, 2019, from https://www.bbc.com/news/magazine-25255957




0 views

(801)885-1389

©2019 by keydiscovery®. Proudly created with Wix.com