Merchant of Feelings

A framework for understanding how successful brands and businesses sell emotions and experiences rather than just products. Based on 5 distinct levels of marketing sophistication.

The 5 Levels of Marketing

1. Level 1: Selling a Product

• Most basic level used by failing companies
• Simply describing product features
• Example: "We are a healthcare CRM using AI"
• Least effective approach because people care about themselves, not your product

2. Level 2: Selling a Solution

• Addresses specific pain points
• Competitive but effective
• Example: Head & Shoulders solving dandruff problems
• Represents about 45% of companies
• Most tech companies stop at this level

3. Level 3: Selling a Lifestyle

• Creates aspirational desires
• Example: Lululemon selling yoga culture, not just yoga pants
• Creates category demand before selling product
• Reference: Stuart Butterfield's "We Don't Sell Saddles" philosophy
• Focuses on getting people to want the lifestyle first

4. Level 4: Selling a Feeling

• Consistently delivers specific emotional experiences
• Example: Disney selling "magical moments"
• Example: UFC selling "holy shit moments"
• Example: Nike selling feeling of greatness
• Focus on emotional impact rather than product features

5. Level 5: Selling an Identity

• Highest level of marketing sophistication
• Used by religions and political parties
• Provides:
  • A tribe to belong to
  • A label to identify with
  • A purpose to fulfill
  • A sense of belonging
• Essentially provides "identity in a box"

Key Implementation Examples

• UFC Example:

  • Not selling fights
  • Selling "holy shit moments" to millions
  • Creates memorable emotional experiences
  • Builds intense audience investment

• Old Cigarette Ads:

  • Never sold product features
  • Focused on cool self-image
  • Created aspirational moments
  • Targeted identity and lifestyle

• Luxury Brands:

  • Louis Vuitton sells status feeling
  • Focus on emotional association
  • Create sense of importance