The power of social identity in branding

Social identity, a component of personal identity, involves defining ourselves based on membership in certain social groups. Individuals might derive social identity from belonging to a fraternity, living in a particular neighborhood, or being a member of a professional organization. Social identity is relevant to brands because of the way social groups influence individuals’ choices and preferences.

A study on solar panel installation demonstrates how the communities we live in can affect our purchasing decisions. Solar panels are expensive to install, so you might assume that only people who see themselves as wealthy or environmentally conscious might install them. But researchers discovered that the most predictive factor in determining where solar panels were installed wasn’t wealth or identifying with liberal political values, but whether someone’s neighbors had installed solar panels. A single solar panel installation increased the average number of solar panel installations within a mile by a factor of 0.44, or almost half.

Many advertising campaigns rely on social identity, suggesting that other members of the target customer’s social group—health-conscious mothers, for example—use a product. Some brands have created social networks exclusively for their customers, essentially forming a social group around their products. Consumers may be more likely to adopt a brand if their social group does, too.

If you’ve ever felt a connection to people who use the same kind of smartphone or ride the same brand of motorcycle as you do, you’ve experienced social identity in branding..