Is Branding on the Web Really Dead?

Magazines and websites need to make money, and many do so by making wild claims and exaggerations to draw you in. Most "insights", however, are simply not true. Perhaps the biggest area of marketing subject to such false promises is branding.

Here's an example. A July 1st 2001 issue of Darwin Magazine featured an article seductively titled "Forget What You Knew About Branding. The Web Changes Everything". The article claimed to describe why four marketing experts agreed with this view, and was interesting for several reasons.

First, the title was a blatant teaser, and indeed the featured gurus said little that related to the article title. Some acknowledged the challenges of branding web-based companies and indicated that some web-based companies have failed. But nothing in the article title told us why we should forget what we knew about branding or how branding on the web is different.

Al Reis discussed the difficulties of making an existing brand into a web-brand, but did not exactly suggest we forget what we know about branding. John Hagel suggested that as we emerge, branding will have a more customized focus to it-with brand meaning centering on what the brand can do for customers personally. All well and good; but these ideas do not mean that we should forget about branding. More important though, the article highlighted a number of misconceptions several "gurus" seem to have about branding.

As we try to remind you often on this site, beware of gurus and magazines that tempt you with puffery. Let's set the record straight on branding.

WHAT IS BRANDING?

Put simply, branding is a concept that deals with the following question-- what does the brand stand for? When you hear Ivory soap you think of purity. Disney implies family fun and entertainment. Maytag means reliability. Want to get clear on what a brand is? Simple - read our tutorials (The Basics of Branding, What are Brand Extensions, How to Create a New Brand Name, Determining a Brand Platform)

Branding is a strategic decision, as it is designed to not only highlight what a brand means, but how it is different from its competitors. Branding provides consumers with a reason to buy the brand-sometimes at a price premium compared with other, more generic brands on the market. The meaning of the brand not only affects consumers' expectations about what the brand experience will be like, it also provides the firm some leverage should they decide to sell the brand, or extend its meaning through brand extensions, family brands, co-branding decisions, or umbrella brands.

The decision about what brand meaning a firm should assign to a brand comes from solid research-analysis of consumers, competitors, and the company's capabilities, as well as trends in the environment. Poor analysis leads to poor decisions about what the brand meaning should be and how it is different or better than the meaning of competitors' brands. Poor analysis leads to poor decisions about when, how often, or why a brand's meaning should change as market conditions evolve.

HOW IS BRANDING EXECUTED?

Branding can be executed through every element of the marketing mix-price, sales promotions, advertising, merchandising, distribution, and product elements like brand names, logos, and packages, product assortments, salesperson characteristics….the list goes on.

Haagen Dazs uses price, quality ingredients and a European sounding name to convey that its ice cream is good tasting and decadent. Ivory's name, product ingredients (99 and 99/100ths % pure), price, and spokesperson (the wholesome and unpretentious Ivory girl) convey the notion that Ivory is pure, natural, and simple.

Consumers infer brand meaning from cues-cues provided by any and potentially every element of the marketing mix. Lexus conveys precision, comfort and status through it's advertising images, its association with its parent company Toyota, its price, its Japanese origins, its name (Lexus sounds like luxury) and its distribution (through special Lexus dealers).

Amazon's "the biggest (and most economical) bookstore on Earth" brand concept is executed through its incredible inventory, its comparison prices, its customer reviews, its easy search engine, and it's name, among other things. Scott Bebury is right when he suggests, "Brands are the sum total of all the images that people have in their heads about a particular company and a particular mark".

Beyond these very simple ideas, people have developed some illogical and misguided notions about branding that we try to clear up below.

WHAT BRANDING IS NOT

Now, let's do away with the myths you read about branding every day.

Myth#1: Branding is Advertising, and Advertising is Branding

This is a big myth. Scott Bebury writes that 39 of the top 50 brands in 1989 had dropped from the Fortune 50 by 1999 - a mere ten years later-despite the fact that these companies did the most advertising. Starbuck's, he argues, became a great brand despite limited advertising and promotion.

Throw this myth out the window. To say that Starbuck's has not done branding is to fundamentally misunderstand the concept of branding. Brand meaning comes from many sources, and advertising is only one. Brand meaning comes from messages that are consistent across time and medium. Starbucks is a great example of branding because it has used merchandising, its name, logo, product assortment, massive distribution network and promotional products to convey the notion that it is a hip, urban, forward-thinking coffee house. To say that companies that do little advertising are not branding is missing the whole point of branding.

Nowhere have I ever heard or read that the companies that do the most advertising are the most consistent in the advertising messages they send. In fact, some of the biggest advertisers offer quite confusing messages, changing their brand meaning constantly and/or offering different images to different demographic groups.

Furthermore, just because some heavily advertised brands fail, we cannot logically imply that branding is at fault. This is what many observers of the Internet demise simply don't understand about branding.

Since branding is executed by multiple elements of the marketing mix including, but not limited to advertising, any one of multiple explanations for brand failure can be offered. To say that branding is advertising is to say that New York City is the Empire State Building.

Myth #2: Branding is Loyalty

Scott Bebury also writes, "Branding is overrated. On average, US corporations lose half of their customers every five years, half of their employees every four years and half of their investors every year. This doesn't sound like a lot of loyalty to me."

Perhaps this is true, but what does this have to do with branding? Even a brand with great meaning can fail if market conditions suddenly change. A poorly identified brand concept or a poorly executed one will surely cause consumers to defect. Defection does not mean that branding itself is bad-perhaps that its initial conception was ill conceived or its execution has failed. By blaming branding, we seem to be throwing out the baby with the bath water.

Myth #3: Branding Changes Consumer Behavior

Another claim is that "Branding has become a religion in most corporations, and it's very hard to dislodge it because people believe that the brand itself is something that changes consumer behavior". Branding cannot change consumer behavior.

In fact, the causal logic is opposite-knowledge of consumer behavior drives branding decisions. E-bay's auction concept stemmed from their realization that consumers love the excitement of auctions and that they wanted to buy used merchandise at a reasonable price in an easy-to--use format.

Myth #4: Because a Company Focuses on Price It's Not Branding

There seems to be a belief on the part of some people that a company that focuses on price is not branding. This is nonsense. For many brands, their meaning is rooted in associations like "economical" or "low price" (think Sauve or Priceline.com).

Myth #5: Because a Brand Fails, Branding is Bad or Dead

Sari Kalin writes that Pets.com's sock puppet accompanied by millions of dollars in advertising were not enough to ensure it's fortune. The author asks whether the demise of Pet.com means the demise of branding. Hardly.

There are many, many reasons why brands fail. Maybe they're not competitively priced. Maybe their advertising isn't sufficient, is confusing, is inconsistent, or misplaced. Maybe they have entered a market where there is insufficient need for the product. Maybe their quality isn't on par with that of competitors' similarly positioned products. Maybe they missed the big market growth period. Maybe they were under-financed, maybe they had a PR disaster. Maybe they weren't in tune with what consumers wanted, or how they shop. Maybe they were blindsided by competitors who offered more for less or any of a number of other reasons.

The failure of a brand should not suggest that branding is an archaic concept.

Myth #6: The Web Makes Branding More Difficult

Is branding more difficult on the web? I see no necessary reason why this should be so. To be sure, the web may have fewer concrete symbols to rely on to create brand meaning, but a number still exist.

Web brands, like all brands have product and service attributes, price, distribution methods and issues, logos, names, and any number of other tactics (ads, endorsements) to convey what the brand stands for. The colors and design of the web-site, its ease of navigation, the FAQ's, the presence of customer comments, the presence of advertising for other companies, the extent to which check out is hassle-free, among many other elements all convey information about what the web-based brand means.

There is no dearth of cues that consumers rely on to infer meaning about a web brand.

Myth #7: Because Customers Can Broadcast Their Experiences, Web-Based Branding is More Difficult

Developing a consistent message is difficult when millions of consumers have the opportunity to blast their own product experiences and potentially diverse opinions to millions of other consumers.

This is true. The web has created the potential for more extensive and rapid word of mouth. But this word of mouth can occur for any brand - web-based or not. This new potential just levels the playing field for everyone.

Interactivity and the ability to navigate from one site to the next make branding on the web more difficult. But how does interactivity make this any different from what packaged goods companies have been facing for years?

Many purchase decisions occur in the store and brands are right there ready for easy comparison through price, package design, logos, product ingredients and labels. Comparison shopping has been around for years, and while the web might make comparison-shopping possible, and in some cases easier, it does not logically follow that this should make branding any less important or difficult to execute. Branding decisions are often what make people decide to buy one brand over another on the basis of comparison-shopping.

So is branding dead or obsolete? Is it more difficult to execute on the web? I don't think so. I think that articles with this focus simply try to lure readers in to sell more advertising or to create hope that they offer the panacea for marketers unsure about what this branding concept is really about.

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ABOUT THE AUTHOR

Dr. Deborah J. MacInnis is the Charles L. and Ramona I. Hilliard Professor of Business Administration at the Marshall School of Business, University of Southern California, and a co-author of Brand Admiration: Build a Business People Love. She has consulted with companies and the government in the areas of consumer behavior and branding. She is theory development editor at the Journal of Marketing, and former co-editor of the Journal of Consumer Research. Professor MacInnis has served as president of the Association for Consumer Research and vice-president of conferences and research for the American Marketing Association's Academic Council. She has received the Journal of Marketing's Alpha Kappa Psi and Maynard awards for the papers that make the greatest contribution to marketing thought. She is the co-author of a leading textbook on consumer behavior and is co-editor of several edited volumes on branding.

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