Focus on online branding

What comprises a successful online brand? Is it an e-commerce site with high levels of traffic? Is it a brand with good name recognition? Is it a profitable brand? Or is it a site with more modest sales levels, but one that customers perceive as providing good service? Although sites meeting only some of these criteria are often described as successful brands, we will see that a successful brand is dependent on a wide range of factors.

Erdem et al. (2002) noted in their study into the impact of brand credibility on consumer price sensitivity, that a credible brand signal helps to generate customer value by: (i) reduc­ing perceived risk, (ii) reducing information search costs, and (iii) creating a favourable, trustworthy perception of the organization. This shows the importance of online branding since web sites must give the impression of trust and deliver a favourable experience to encourage first-time and repeat sale.

Many think of branding only in terms of aspects of the brand identity such as the name or logo associated with a company or products, but branding gurus seem agreed that it is much more than that. A brand is described by Leslie de Chernatony and Malcolm McDon­ald in their classic 1992 book Creating Powerful Brands as

an identifiable product or service augmented in such a way that the buyer or user perceives relevant unique added values which match their needs most closely. Furthermore, its success results from being able to sustain these added values in the face of competition.

This definition highlights three essential characteristics of a successful brand which we need to relate to the online environment:

• brand is dependent on customer perception;
• perception is influenced by the added-value characteristics of the product;
• the added-value characteristics need to be sustainable.

To summarize, a brand is dependent on a customer’s psychological affinity for a product, and is much more than the physical name or symbol elements of brand identity.

De Chernatony (2001) has evaluated the relevance of the brand concept on the Internet. He also believes that the main elements of brand values and brand strategy are the same in the Internet environment. However, he suggests that the classical branding model of the Internet where consumers are passive recipients of value is challenged online. Instead, he suggests that consumers on the Internet become active co-producers of value where con­sumers can contribute feedback through discussion groups to add value to a brand. De Chernatony argues for a looser form of brand control where the company facilitates rather than controls customer discussion.

A further method by which the Internet can change branding that was suggested by Jevons and Gabbot (2000) is that online, ‘ the first-hand experience of the brand is a more powerful token of trust than the perception of the brand. In the online environment, the customer can experience or interact with the brand more frequently and to a greater depth. As Dayal et al. (2000) say, ‘on the world wide web, the brand is the experience and the experience is the brand. They suggest that to build successful online brands, organizations should consider how their proposition can build on these possible brand promises:

• the promise of convenience – making a purchase experience more convenient than the real- world one, or that with rivals;
• the promise of achievement – to assist consumers in achieving their goals, for example supporting online investors in their decision or supporting business people in their day- to-day work;
• the promise of fun and adventure – this is clearly more relevant for B2C services;
• the promise of self-expression and recognition – provided by personalization services such as Yahoo! Geocities where consumers can build their own web site;
• the promise of belonging – provided by online communities.

Summarizing the elements of online branding, de Chernatony (2001) suggests successful online branding requires delivering three aspects of a brand: rational values, emotional values and promised experience (based on rational and emotional values).

An alternative perspective on branding is provided by Aaker and Joachimsthaler (2000) who refer to ‘brand equity’ which they define as:

a set of brand assets and liabilities linked to a brand, its name and symbol, that add to or subtract from the value provided by a product or service to a firm and/or to that firm’s customers.

So, brand equity indicates the value provided to a company, or its customers through a brand. Assessing brand equity on the web needs to address the unique characteristics of computer-mediated environments, as Christodoulides and de Chernatony (2004) have pointed out. These researchers set out to explore whether additional measures of brand equity were required online. Based on expert interviews they have identified the additional measures of brand equity which are important online, as summarized in Table 8.9. As we would expect, this includes attributes of the digital medium such as interactivity and cus­tomization which combine to form relevance and a great online brand experience. Content is not stressed separately, which is surprising, although they do mention its importance under site design and it is also a key aspect of other attributes such as customization, rele­vance and the overall experience. Their work on the need for rational, emotional appeal together with the promised experience of the web site is presented in Figure 11.8.

1. Brand identity

Aaker and Joachimsthaler (2000) also emphasize the importance of developing a plan to communicate the key features of the brand identity and increase brand awareness. Brand identity is again more than the name. These authors refer to it as a set of brand associations that imply a promise to customers from an organization. See ‘Napster.com’s brand identity’, Mini Case Study 8.1, to see the different elements of brand identity which are effectively a checklist of what many e-tailers are looking to achieve

Ries and Ries (2000) suggest two rules for naming brands. (a) The Law of the Common Name – they say ‘The kiss of death for an Internet brand is a common name’. This argues that common names such as Art.com or Advertising.com are poor since they are not suf­ficiently distinctive. (b) The Law of the Proper Name – they say‘Your name stands alone on the Internet, so you’d better have a good one’. This suggests that proper names are to be pre­ferred to generic names, e.g. Handbag.com against Woman.com or Moreover.com against Business.com. The authors suggest that the best names will follow most of these eight prin­ciples: (1) short, (2) simple, (3) suggestive of the category, (4) unique, (5) alliterative, (6) speakable, (7) shocking and (8) personalized. Although these are cast as ‘immutable laws’ there will of course be exceptions!

2. The importance of brand online

The Internet presents a ‘double-edged sword’ to existing brands. We have seen that a con­sumer who already has knowledge of a brand is more likely to trust it. However, loyalty can be decreased because the Internet encourages consumers to trial other brands. This is sug­gested by Figure 8.23. This trial may well lead to purchase of brands that have not been previously considered.

The BrandNewWorld (2004) survey showed that in some categories, a large proportion of buyers have purchased from different brands from those they initially considered, for example:

• Large home appliances, 47%
• Financial products and services, 39%
• Holidays and travels, 31%
• Mobile phones, 28%
• Cars, 26%.

But, for other types of products, existing brand preferences appear to be more important:

• Clothing/accessories, 22%
• Computer hardware, 21%
• Garden/DIY products, 17%
• Home furnishings, 6%.

The survey also suggested that experienced Internet users were more likely to switch brands (52% agreed they were more likely to switch after researching online) compared to less- experienced users (33%).

Of course, the likelihood of a consumer purchasing from an established brand will depend upon the combination of their knowledge of the retailer brand or product brand. Figure 8.24 shows that many customers will still buy an unknown manufacturer brand if they are familiar with the retailer brand. This is less true if they don’t know the retailer. Sig­nificantly, if they don’t know the retailer or the brand, it is fairly unlikely they will buy.

The activity illustrates the importance of building brand awareness for an e-commerce ser­vice in a cost-effective manner at the same time as achieving good levels of service quality. Success factors for building a brand online are described further in the Focus on excelling in e-commerce service section in Chapter 9. Key aspects of creating a positive customer experi­ence are:

• Content quality (Can the customer easily find relevant, up-to-date content? Are there errors?)
• Adequate performance of web site infrastructure in terms of availability and download speed
• Ease of contacting a company for support by e-mail or the customer’s preferred channel
• Quality of response to e-mail enquiries and fulfilment quality
• Acknowledgement of customer privacy
• Reflecting and supporting the characteristics of the offline brand.

Managing the technology and customer database necessary to deliver service is a key aspect of e-marketing and requires close interaction between marketers and the IS department or external consultants.

Source: Dave Chaffey (2010), E-Business and E-Commerce Management: Strategy, Implementation and Practice, Prentice Hall (4th Edition).