Valuations & Acquisitions: The 5 Cs for Better Gross Margins
The 5 Cs
Lazard’s Solomon offers up just the tonic to improve your margins: The five Cs.
Hit products have delivered functionality and developed this social acceptance to become brands over time. So a retailer can sell existing brands, such as Zappos’ products, or develop its own brand. Zappos, for example, has become a credible brand that delivers on its promise.
It’s more powerful to develop your own brand over time, Solomon says, by delivering on its promise and gaining credibility with consumers. Credibility with many consumers will generate word-of-mouth referrals and ultimately build the brand.