Bucks New University Faculty of Design, Media & Management Module: VM603 BA (Hons) Advertising: Creative To what extent has the digital age affected the building of brands? Charlotte Prince 21114275 Bill Schaaf January 2014 Word Count: 7905
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Contents Introduction
Chapter 1:What are brands and how are they built? What is a brand? Why are brands important to businesses? How are brands built?
Chapter 2: How has the digital age affected the way brands are built? What is the digital age? How has the digital age affected the world around us? How has this affected brands directly?
Chapter 3: How should brands be built in the digital age? What is purpose? Why is it important that a brand has a purpose? How to you deliver a purpose? Barclays case study
Conclusion
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Introduction The digital age is upon us and has already become an integral part of our lives whether we like it or not. But this is only the start. It’s the next stage of our evolution to make us smarter, stronger and faster in every aspect of our lives. In this dissertation, I will investigate the extent to which the digital age has affected the way brands are built to come to a conclusion about how they should be built in the digital age. The idea of brands was invented in the last revolution but the digital age has drastically changed the environment that they live in. As we are hit upon thousands of messages from brands a day, we are becoming immune to the traditional method of mass broadcasting advertising. How can brands keep up and continue to play a useful role in consumers’ lives? The digital age has handed over the power to the consumer. The brands that see the opportunities in this and aren’t scared to lose control will thrive, and may even make the world a better place. “Digital has given advertisers and creatives the chance to make a difference. It’s worth celebrating…There has never been a better time to work in advertising. Bring on 2014”1 George Prest, VP, ECD at R/GA London
In this dissertation I will explore into how businesses can use brands to take advantage of the opportunities and lessen the threats. Firstly, I will explore the definition of the word “brand” and why it’s important to a business. The common misconception is that a brand is a just a name and logo. Secondly, I’ll investigate the impact that the digital age has had on consumers’ lives; affecting the way they behave. This will allow me to look at the impact the digital age has had on brands and how businesses have had to adapt. Finally, I will look to the future of brand building; how brands are going to evolve to redefine the role they play in consumers’ lives. I’ll end with a case study on how Barclays redefined their brand promise to adapt to the digital age, with interviews from Barclay’s lead creative agency, Dare.
1 Prest, G, 'There's never been a better time to work in advertising' http://www.theguardian.com/media-‐
network/media-‐network-‐blog/2014/jan/17/never-‐a-‐better-‐time-‐to-‐work-‐in-‐advertising (accessed January 2013 ).
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What is a brand? If you were to ask someone, “what is a brand?” they would most likely refer to a company image; the businesses logo; slogan; identity; name; product. The word “brand” is heavily used but often in an incorrect manner. For example, The Oxford Dictionary defines a brand as: “A type of product manufactured by a particular company under a particular name: a new brand of soap powder” 2 2
The Oxford Dictionary
But a brand is so much more than just a name. Take Kellogg’s for example, they went to the extreme of developing their signature ‘crunch’ in a sound lab and trademarked it, with equal importance to the logo and name. 3 “Brands are promises about who you are and what benefits you deliver that are reinforced every single time people come in contact with any facet of your organisation”4 Douglas Burdett So every time someone eats a bowl of cornflakes, and hears the Kellogg’s signature crunch, the brand is reinforced in their heads. As Stephen King famously said, “A product is something that is made, in a factory; a brand is something that is bought, by the consumer”.5 A business is expected to keep the brand promises it makes to the consumer whether it is through customer service, the product itself or even what the brand stands for. This is especially important in the digital age when people’s opinions are often magnified on a worldwide platform (the internet). “51% say consumer opinions found on a company's website have a greater impact on purchase decisions than recommendations from family and friends.”6 So it is now more critical than ever that businesses deliver on their brand promise, to keep existing customers and also gain new ones. The brand lives in the mind of the consumer; businesses don’t bring brands to life, people do. “A brand is simply a collection of perceptions in the mind of the consumer”7 Paul Feldwick 2
'Defination of a brand in English' www.oxforddictionaries.com/definition/english/brand (accessed January 2013 M Lindström, Brand Sense: Build Powerful Brands Through Touch, Taste, Smell, Sight, and Sound, The Free Press, New York, 2005, p. 12. DiFrisco, M, 'Branding Definition' http://www.how-to-branding.com/Branding-Definition.html (accessed January 2013 ). 5 Pakseresht, A , 'Brand Equity and Corporate Responsibilty'A review of brand valuation methods vol , no ..A review of brand valuation methods,2010. p. Available from : A review of brand valuation methods 6 Honigman, B, 'How Millennials are Shopping: 20 Interesting Statistics & Figures' http://www.brianhonigman.com/millennials-shopping-habits-2013/ (accessed January 2013 ). 7 HBS Press, Strategy: Create and Implement the Best Strategy for Your Business, Harvard Business School Press, Boston, 2013, pp. 3-‐13. 3 4
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The whole concept of a brand lives in the consumers mind; individuals have a different opinion on what a brand is depending on their personal experience with it. Each experience they have adds to the overall impression of a brand and once an opinion has been made its often hard to change it. Whether people are consciously aware of it or not, they will have an opinion of a brand, be it positive, negative or neutral. The Pepsi Challenge case study is a brilliant example of how the power of a brand idea in the consumer’s mind can override even the most powerful of senses; taste. The Pepsi Challenge marketing campaign of the 1980s was created to try and threaten coke with the reality that their drink tastes better. Putting all prejudice and bias aside they created a blind test on just pure taste; it was Pepsi vs. Coke. Pepsi won. After proving that Pepsi was in fact a better tasting drink, Pepsi started to gain market share and in 1983, Pepsi was outselling Coke in supermarkets. It was Coke’s move. They started doing their own taste testing on the road to create ‘New Coke’ - a sweeter tasting drink.3 However, when they launched ‘New Coke’ it outraged loyal consumers and Coke quickly did a U-turn, announcing that they’d Fig.1- Original 1980’s Pepsi challenge made a mistake and bringing back the old taste. Since then, Coke has focused on brand first and foremost, even over flavour. And today, Pepsi is behind Diet Coke and Coke as the number three soft drink. More recently, Read Montague of Baylor College Medicine did a new version of the Pepsi challenge but this time hooked subjects up to an fMRI machine. Again Pepsi was the preferred drink in a blind taste test. Pepsi reached higher levels of activity in an area of the brain called ventral putamen; the part that helps evaluate different flavours. However, when Montague conducted a non-blind taste test, Coke was the preferred drink. The tests showed that Coke induced higher activity in the medical prefrontal cortex, where the higher thinking functions of the brain happen. The test subjects were associating the taste with the brand idea in their heads and essentially over riding their taste buds. 8 This example clearly demonstrates not only that the brand lives completely in the mind of the consumer but also how powerful it can be. A brand is a promise. Every time a business keeps to that promise the relationship with the consumer is built.
8 Yglesias, M, 'Sweet Sorrow' http://www.slate.com/articles/business/rivalries/2013/08/pepsi_paradox_
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Why are brands important to businesses? If a brand lives in the mind of consumer then why is it important?
Market share Market share is important for all businesses as it has a direct link to profitability. Research shows a brand that has 40% market share generates three times the profits of a brand that owns 10%. 94 To gain market share, a brand’s share, a brand’s share of voice should exceed its share of the market, as shown in the graph to the right.
Fig.2 –Graph showing the effects of share of voice to market share
One way to do this is to outspend competitors. But even a low spend can result in an increase in market share if the creative is more powerful than the competitor’s advertising. Creating a strong brand enables more powerful creative because it provides a promise to hang off.
Barriers to entry When a business is succeeding in a market, naturally other businesses will try to compete to gain market share. Developing strategies to prevent competitors from entering the market is critical to any business. Building a strong brand is a good strategy to do this, and can be done in two ways: 1. The business can dominate with heavy investment in brand advertising. For example, soap is a simple product with low costs however the leading businesses have made it near impossible to enter the market; it’s estimated that it would cost £10,000,000 to create a soap brand. This prevents most competitors from taking the risk of entering the market.
9 HBS Press, Strategy: Create and Implement the Best Strategy for Your Business, Harvard Business School Press, Boston, 2013, pp. 3-‐13.
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2. A single business can dominate the market by owning the product association in the consumers mind, for example, Lycra. When a new product has been invented to satisfy a need for the first time, the business has an opportunity to own that brand association with the product. By doing so they can create a barrier to entry.
Extending into new categories Businesses can develop into other categories by launching new products and services under the same brand.
Apple originally began with the computer and has now extended into the portable music player and smart phone categories.
Fig.3- The history of Apple; entering into new categories by launching new products
The benefits of a brand doing this is: -‐ -‐ -‐ -‐
Creating a new resource of revenue Improving the brand in the eye of the consumer Being able to respond to a change within the current market It keeps the brand fresh; brands outlive products
Lower price elasticity A business with a good brand can usually afford to raise their prices without losing sales; it is typical that brands with high market share enjoy low price elasticity. When PG Tips increased their price by 1% the market share fell by 0.5 points but when Tetley increased their price by 1% their market share dropped by 1.4 points. PG Tips was a stronger brand than Tetley. 105
10 HBS Press, Strategy: Create and Implement the Best Strategy for Your Business, Harvard Business School Press, Boston, 2013, pp. 3-‐13.
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Commanding a premium Consumers associate a higher price with superiority and quality. Therefore, a business can command a higher premium with a luxury brand that promises good quality. Often spending a high price is part of the customer experience that they enjoy especially in inspirational brands such as cars and perfumes. However, businesses stand to lose customers if the price is deemed too high.
Retaining and attracting employees The hiring process can be a major cost for a business but a strong brand can reduce these costs dramatically by being attractive to current and potential employees. When a business successfully communicates information about its culture it can attract the right kind of people. It’s also important to retain happy employees to avoid recruitment costs and maintain well functioning teams. “Your employees are often the most visible and impactful aspects of your organization“116 Strategic Communications, LLC The brand creates a sense of purpose, pride and loyalty within the staff that reflects what the brand stands for. This is critical to the success of a brand, as consumers often form their opinion of a brand based on their experience with an employee. Trust and loyalty Though many brands believe they have loyal consumers even the largest of brands don’t have complete brand loyalty, 72% of Pepsi drinkers also drink Coca Cola.12 With such over-crowed markets it’s hard to keep consumers loyal, brands can only hope when consumers come to making a decision between a brand and a competitor, the consumer choices you. There are two ways a business can use a brand to gain loyalty: 1. Stand for something - have a purpose that consumers will be believe in and buy into. If the brand stands for something, customers will align themselves to that purpose. 2. Consistently over deliver on the customer experience. As previously stated, take a consumers experience from ordinary to extraordinary. People rely on their knowledge of a brand to simplify purchase decisions. “Brands are a storehouse of trust”137 11 Communications, S , 'Branding Through Your Employees -‐ Strategic Communications'Success through strategy vol , no ..Success through strategy ,2012. p.1 -‐ 5
Available from : Success through strategy 12 Weigel, , 'How to (not) Fail' Wieden and Kennedy Amsterdam http://www.slideshare.net/mweigel/how-‐to-‐not-‐fail-‐16647530 (accessed January 2013 ). 13 J Miller and D Muir, The Business of Brands, John Wiley & Sons, Chichester, 2004, pp. 21-‐85.
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Niall FitzGerald, Unilever Brands are a promise to a consumer about a product, and a consumer must be able to trust that this promise will be upheld. A strong brand can build trust through consistency, making the purchase decision all the more simple.
Dealing with market disruption The sign of a strong brand is that it can stand the test of time when things get tough. Bill Gates stated that bad news could also represent a good opportunity when it came to business. “You have to be consistently receptive to bad news, and then you have to act on it”14 Bill Gates Nike was one of the first power brands to cut marketing budgets in the recession, and so they had to innovate; they focused on digital. “Instead of coming up with an expensive TV campaign, they came up with something that people are watching on YouTube. It's more bang, less buck” 15 Thomas Shaw Nike are using social media to go from telling people to “Just Do It” to now actually helping them to do it. By developing apps such as Nike+, they are contacting consumers in a totally unique way, showing the strength of the brand.
Fig.4- Nike+ Running app
14 , F, 'Bad News is Good News' http://totallybaked.wordpress.com/2006/08/09/bad-‐news-‐is-‐good-‐news/ (accessed January 2013 ). 15 'In recession, Nike is likely to cut marketing' http://www.nytimes.com/2009/02/12/business/worldbusiness/12iht-‐nike.4.20150218.html?_r=0 (accessed
January 2013 ).
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Impacting on consumers “Brands are valuable to businesses because they are valuable to consumers” 168 Millward Brown As a brand makes promise, a relationship with the brand is formed. Though this relationship is a metaphor for human relationships, what people look for in a brand is similar to what they look for in people. Identity, clarity, consistency, membership, reassurance, personality are all characteristic people look for in the brand and their promise. Once a brand puts meaning and purpose behind a product people can become attached to it. They rely on them to be consistent in their quality, trust and reliability. Strong brands simplify decisions. Brands are a promise that consumers hope they can trust. They are mental shortcuts the people making during decisionmaking. Brands are becoming part of the system of “heuristics” (i.e. the shortcuts used for decision-making), making the purchase decision easier. If a brand is well known and popular, even for first time consumers it is seen as a good, safe decision. The emotionally connotations with a brand allow consumers to make a decision quickly, rather than weighing up the rational benefits between competing brands.
16 Brown, M , 'Business of Brands'Collective Intelligance for Marketing Today vol , no ..Collective Intelligance for Marketing Today,2013. p.7 -‐ 7 Available from :
Collective Intelligance for Marketing Today
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How are brands built? There are three important aspects to building a brand; 1.Consistency The first and arguably the most important step in building a brand is consistency. As previously explained, the value of a brand is in the consumers mind; the consumer who has put trust in the promise the brand has made. Break that promise; break the trust. Consumers all have different experiences with a brand however there is a common pattern: 1. The consumer hears about the brand and its promise 2. Consumers experience the brand for themselves and whether the promise holds true 3. Consumers experience the brand again, this time with expectations that the brand will deliver on the promise they experienced before 4. Consumers continue experiencing the brand, gaining loyalty 5. Consumer recommend the brand to friends and family This is a dream scenario for a brand, building on one customer at a time, and consistently delivering the brand promise given. To ensure the next stage of building a brand-consumer relationship, each touch point must be consistent with the promise. Consistency needs to be demonstrated in every aspect of the brand. A brand is built top down and inside out from product, to service to the way the business is ran and the decisions are made. Brands can’t afford mistakes in the digital age as those mistakes are now magnified; not only will one customer’s experience be effected, it’s potentially the whole world. 2. Persistence The power brands of our generation did not become famous over night. Persistence was key to creating the brands they are today. Looking back at the earlier case study of Coca-Cola; when “New Coke” was released, the promise to the consumer was broken which angered loyal customers. However, the brand had a history of persistently delivering on their promise and so they were able to do a U-turn without too much damage to the brand. By staying persistent in keeping to the brand promise in encourages awareness, loyalty, new customers all that lead to growth. Digital age has allowed brands to be persistent in content and evaluate to what the consumers respond and don’t respond too constantly improving the brand.
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3. Restraint Sometimes a business can be tempted by opportunities such as extension or expansion which would ultimately break the brands promise, causing more damage than good. In this case, a brand needs to know when to exercise restraint. If a brand lacks restraint then all previous efforts in consistency and persistence can be broken. It could only confuse the customer but also violate their trust. Building a brand is a long-term strategy; persisting in consistently sticking to the promise you have given. If the brand shows restraint, they can look past the short-term opportunities to gain profits.
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What is the digital age? Before the mid 18th century it was impossible to produce products at a scale where brands could be invented. However the industrial age changed this allowing people to regularly buy the same products from brands rather than making everything for themselves, which enabled the rising of advertising. Ever since then, the concept of brands has grown and become more and more powerful. But how will brands adapt in a new world magnified by the digital age? The digital age began in 1946 as people decided to wait to have families after World War II, when the economy was stronger and they could support them better. People born in this time are known as the “baby boomers”. Due to this mass increase in population there was an increased demand for entertainment and the baby boomers became the TV generation. TV viewing consumed a large amount of their day and quickly became the most powerful communication technology available. Fig.5 The TV generation
“Living in an age of advertisement, we are perpetually disillusioned. The perfect life is spread before us every day, but it changes and withers at a touch.” 179 Joseph Priestley (March 13, 1733 - February 06, 1804) The baby boomers then started having children of their own, creating “the echo of the baby boom” (1980) also know as Generation Y/ Millennials. This era saw the rise of the computer, internet and digital technology. The internet became more accessible and computers became more powerful. “Generation Z” followed and were named the “always on generation” because they have grown up with internet constantly at their fingertips. Today, half the country goes online everyday (30 million) spending around 57 hours per month on computers. The development of mobile has driven people to be online more than they are awake.
17 Priestley , J, 'Quotes' http://www.brainyquote.com/quotes/quotes/j/jbpriest103134.html (accessed January 2013 ).
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Social Experiment
I personally conducted a social experiment between the “baby boomers”, “Generation Y” and “Generation Z” to see how each demographic interacts with digital during a typical day. To keep the test as fair as possible all subjects were asked to conduct the test on the same day to see how they interacted with the digital age It was interesting, but not surprising that the younger the person, the more they interacted with digital throughout their day. The younger generation also used a wider variation of digital than the older generation. As you work down through the generations its clear to see the behaviour changes. Though they are all interacting with digital the Generation Z (Isabella) didn’t note when coming off digital interation and when asked was due to the fact she didn’t. She switched from one to the next, living up to the “always on” generation. The multi-tasking over media’s was also a key aspect to the test, interacting with more than one device allows brands to grab them one many platforms, however grabbing their attention would be difficult. The use of mobile was also apparent, social media’s that were designed for computers have become a large aspect of the mobile generation.
Fig. 6 Social experiments
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How has the digital age affected the world around us? I have used the basis of a SWOT analysis to analyse the opportunities and threats to brands brought about by the digital age. I’ve focused on external factors since they relate a company to its environment. By focusing on the opportunities and threats of the digital age I will be able to clearly see what has impacted brands the most. Work and lifestyle trends As talked about previously, we are in a generation totally surrounded by the digital world. Not only do we rely on the digital world for simply finding information, interacting with friends and entertainment, but also education, and work. It’s a large aspect of our lifestyle. “Internet sites created twice as many jobs (2 million total) in 2011 compared to 2007” 1810 Harvard Business School In a time of unemployment, the internet is creating a dramatic increase in jobs. Today, 50% of primary school children will end up with jobs that haven’t even been invented yet. 19 However, at the same time, with emerging technology, there is also a decrease jobs. “Robots are likely to take 45% of all the jobs over the next few decades” 20
Tim Worstall The increase and decrease in jobs can be both an opportunity and a threat for businesses. A critical part of building a brand is the consumer experience as that is where they make their opinion on a brand. By introducing machines into the consumer experience, it ensures that the experience is consistent (critical aspect of building the brand) as the brand has complete control over what the machine says and does. On the other hand it lacks that personal touch which can take an experience from ordinary to extraordinary. So personally I believe its all dependant on what the brand is and what they stand for in the engagement they have with the consumer. Another major lifestyle change is how we shop. We now have the option of both high street stores and online shopping which gives consumers a much larger choice. A 17.8% increase in retail sales was due to online shopping with it constantly increasing. 21 The next generation of shopping has massively influenced certain brands, it allows consumers to change freely between brand to brand as the competition is now not the shops down the 18 Heine, C, 'The Digital Stimulus Package' http://www.adweek.com/news/technology/digital-‐stimulus-‐package-‐144087 (accessed January 2013 ).
19 Waite, J, '"50% of primary school children will end up with jobs that haven’t even been invented yet"' http://jeremywaite.tumblr.com/post/53142053633/50-‐
of-‐primary-‐school-‐children-‐will-‐have-‐jobs-‐that (accessed January 2013 ). 20 Worstall, T, 'Phew, The Robots Are Only Going To Take 45 Percent Of All The Jobs' http://www.forbes.com/sites/timworstall/2013/09/18/phew-‐the-‐robots-‐ are-‐only-‐going-‐to-‐take-‐45-‐percent-‐of-‐all-‐the-‐jobs/ (accessed January 2013 ). 21 West, , 'A truly mobile Christmas? How mobile is playing a key role in retailers' Christmas campaigns' http://www.thedrum.com/news/2013/11/11/truly-‐ mobile-‐christmas-‐how-‐mobile-‐playing-‐key-‐role-‐retailers-‐christmas-‐campaigns (accessed January 2013 ).
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local high street but the whole world, making it much harder for small and unknown brands to get noticed. Take the high street music industry for example which has been destroyed with 80% share now being online. 22 Personally though I think it has complicated things for brands on this magnified scale. It’s an opportunity for brands and for the consumers. The brands now have the opportunity to expand internationally whilst saving on property and staff costs. Lower overheads means more profits. The consumers also get the benefits of being able to shop anywhere at any time, reduced costs, best products available worldwide and easy and flexible shopping at the press of a button.
Customers The way we use digital technology is dependent on certain factors such as age, gender, location etc. However, the digital age has affected every factor in different ways. One major difference is the voice of the consumer. Word of mouth once meant telling your friends and family about something but that’s now been magnified on a digital platform to the world. Now, the whole world can find out whether an experience with a brand was positive or negative. Though this is initially seen as a threat to a brand it is also a massive opportunity. Where brands before had to guess what the consumers did and didn’t like, they can now listen in and respond to it positively even though they can’t control it. Also the ability to reach consumers has dramatically changed for brands due to the internet. With digital platforms expanding to mobiles and other portable devices, brands are able to reach the consumer 24/7 at any point of their lives. With the average London commuter getting over 3,500 marketing messages daily and 99% of them going unnoticed2211it is now becoming harder and harder to stand out amongst the masses of competing content. However incentives encourage consumers to interact with a brand; a critical aspect in building brands in the digital age.
Emerging Tech With the UK government about to spend £830 million on improving its broadband infrastructure, the digital age is about to get much more powerful and open the consumers to more rich internet experiences. Mobile is also a massively developing technology with more and more people moving away from computers to more portable platforms. The new 4G that has just been realized in the UK means that while YouTube films take 30 seconds to download on 3G, HD full length film will take a 10th of that time on 4G. 2 22 Gibson, O, 'Shopper's eye view of ads that pass us by' http://www.theguardian.com/media/2005/nov/19/advertising.marketingandpr (accessed January 2013 23 Digital Britian, the truth about how w e live today through technology (not get pulished (accessed Januray 2013)
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With 35 billion devices already connected to the internet, emerging tech is reaching new parts of a consumers life. Google has just invested 3.2 million dollars in Nest. Nest is a home automation company that designs and manufactures programmable thermostats and smoke detectors. It is controlled over Wi-Fi working out what temperatures you like and can be adapted if you’re at home or away. This mass development shows that brands are physically starting to not only move into your house but collect data on it too.
Fig. 7 Nest thermostats
Competition As previously explained, the internet has enabled brands to sell to a global market. However, it also means that they have global competitors too. The internet has allowed communication between brand and consumer publically unlike broadcast advertising where the consumers opinion never heard from the brand. Due to the public nature of brand-consumer relationships barrier for entry has become more difficult as the competitors have the ability to view the relationship, at its strongest and weakest points. This has affected the price sensitivity and price elasticity of brands due to the available substitutes. Also, the ability to enter into new categories and markets means that brands that were never thought of as competition can become a sudden threat. For example, Tesco’s was seen as a food supermarket but is now expanding into everything from home goods to mobile networks, causing threats where there was never concern for before.
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How has this affected brands directly? As seen above, the digital age has magnified every aspect of a brand, showing the truth in what a brand stands for and what it is actually doing about it. I will now go into detail about how businesses can use this to their advantage when building a brand. Gaining insights The digital age has enabled brands to be able to listen to millions of conversations happening digitally every minute. The internet has magnified not only the extent of conversation but the volume too. It hasn’t just changed the way people talk but also how they behave with their buying and social habits. Having the ability to watch what people are saying and doing has allowed brands to find insights about their customers and potential customers they would have never been found before. Better insights help better meet the consumer’s needs and expectations which results in a better chance of becoming a powerful brand. The internet has magnified brands understand of peoples minds and what they want. Relevant differentiation When building a strong brand a brand promise is essential. Creating a brand promise based on its functional benefit is a must. However, if you are able to create a brand promise that does more than that it makes a stronger brand; making a brand promise that is relevantly different helps defeat the challenge of standing out especially in a market that has been magnified by the internet. The strong brands that stand out in a meaningful way are those that put equal time and effort into offline activity as they do online activity, ensuring the brand promise is not only different but is consistent. The Dove campaign was based around an insight that only 2% of women found themselves beautiful. By using this insight, Dove differentiated itself from the market by redefining what beauty is, going from what started as a “beauty bar” to the “Real Beauty” campaign. “Dove is based on a big ideal, not simply an idea. In essence, it’s that Dove believes the world would be a better place if women were judged by a broader perception of beauty. Ideals endure far beyond functional benefits. More than that, they’re media neutral and, in fact, in Dove’s case, leave “space” for consumers to make their own contributions to support the ideal. An ideal can become a shared endeavor between advertiser and consumer”24 12 Rory Sutherland
24 AP Adamson, Branddigital: Simple Ways Top Brands Succeed in the Digital World, Palgrave Macmillan, Basingstoke, 2009, pp. 35-‐127.
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Authenticity was the key for Dove as they wouldn’t have the authority to talk about beauty if their product hadn’t stemmed from that function in the first place. Later, Dove released “Evolution”; a YouTube film that reached millions. It demonstrated against the fake beauty within advertising, and more important what the rest of the beauty market was doing. This helped them differentiate the brand even further whilst sticking to the brand promise. Dove used the power of the internet to not only deliver the message but allow consumers to Fig. 8- Youtube- Dove “Evolution” engage and naturally keep the conversation going. This then expanded into other platforms such as famous TV shows causing the brands name and promise to spread naturally. By clearly defining the functional and emotional benefits of the brand it prompted people to get involved though the brand stayed digitally neutral throughout. The idea drives the branding, not the technology, creating a platform for the brand to build on.
Delivering the brand promise Once a business makes a brand promise, they must do all that they can to keep it, as the truth can’t be hidden in the digital age; word of mouth has been magnified by the internet. This is a critical part of building a brand as 68% of people are more likely to believe another consumers view than any media source. Brands have to be ready to react to not only negative put positive views and react accordingly when brand promises are broken to ensure they don’t lose customers and put off potential new ones.
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Following the customer journey The digital world is creating new and innovative ways to contact consumers and equally for consumers to contact brands. It has also highlighted how the consumers come in touch with a brand and whether the brand delivers their promise at those touch points. However, the new generation has become “media multi-taskers” with 60% involved in other activities while watching TV and 2/3 of that being on the internet simultaneously. The customer journey isn’t a one liner anymore and each consumer has a totally different journey from first awareness of the brand, to purchase, to reviewing an opinion of their experience. Brands need to work out common touch points in the journey and making such not only is the brand promise made but they are given an extraordinary brand experience, ensuring it is a positive one.
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What is a purpose? The idea of purpose began in 1999 when Naomi Klein published “No logo”, highlighting the ethics of branding. The idea that businesses can, will and do make the world better has now become an important part of what a brand is and what it stands for. The digital age has not only made businesses more aware of the impact they are having, but consumers have become more aware too. As previously discussed, consistency is a critical part of building a brand because it helps builds trust. But it could be detrimental if the consistent message is the wrong one. This makes it essential that a business has a clearly defined brand purpose for not only what they are doing but who they are as a business. Ethical consumption used to be somewhat niche. But now, thanks to the digital age, the importance of ethical consumption has been well publicised. From celebrity chefs advocating for the use of free range eggs, to whole supermarket product lines becoming Fairtrade. Today £1.5 billion worth of Fairtrade produce is sold in the UK every year, with big names such as Starbucks, Topshop and Cadburys showing their support. Businesses are realising the importance of doing ethical good. Not only do I personally feel strongly that this is the right thing for businesses to do, but it has become a serious topic in conversation amongst advertising now. D&AD award white pencils for “creativity for social good” and Harvard Business Review published a book called “True Story” by Ty Montague on how having a purpose is linked to financial returns. However, as good as being good is, marketers are increasingly being called on to demonstrate the value of what they do. There’s a struggle between upholding a brand purpose and reaching financial targets set by the client. Why is it important to a business? Some might argue against having a meaningful brand purpose by saying that a business’s sole purpose is to make money. “There is one and only one social responsibility of business — to use its resources and engage in activities designed to increase its profits”25 13
Milton Friedman It’s fair to say that a business is defined as a way of making money but the way they go about it has to change to keep up with the digital age. As previously discussed, it’s now about balancing what both the business and consumer wants. 25 Fox, J, 'The Social Responsibility of Business Is to Increase … What Exactly?' http://blogs.hbr.org/2012/04/you-‐might-‐disagree-‐with-‐milton/ (accessed January
2013 ).
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“The need to make money with a desire to improve lives.” 2614 Nick Hirst Consumers value things that make their life better; save them time, make them or the people around them happy or protect the things and people they love. If a business is creating things that are making consumers lives better then it is close to having a purpose. Consumers are willing to pay more for this because they value it more. Make people’s lives better and the money with naturally flow after. People are more likely to hand over their money, if the result is about making their life better. Businesses often forget the reasons behind why the consumer pays money in the first place; to improve their life through a service, valuable good or an experience. When building brands in the digital age, it is critical that not only does the brand have a purpose, but that it is consistent, persistent and resistant with it. Do consumers really care? Having a brand purpose can help make the world a better place. But do consumers really care? Most consumers turn a blind eye to news that some high street shops sell clothes made in sweat shops. They drive unnecessarily inefficient petrol cars. Consumers even happily damage themselves with cigarettes and alcohol. There’s a saying that goes, ‘what you don’t know doesn’t hurt you’, but with information ever more readily available due to the internet, people are starting to become aware of the issues and they are changing their behaviour. In fact, 65% of people say that they would like to buy ethically produced products but found them too expensive. Businesses never set out to be evil; they try to give the consumer what they want. The reality is that consumers don’t know what they want until it’s given to them. So a business has a responsibility to lead them down the right path. “If I had asked people what they wanted, they would have said faster horses.”27 Henry Ford 83% of consumers agree that “it is important for companies/corporations to understand that they have a greater impact on society and the environment”. Conversely 11% say that “companies/corporations social responsibility is of little interest to me.”
26 Interview, Nick Hirst, Joint Head of Planning, Dare
27 Ford, H, 'Quite' http://www.goodreads.com/quotes/15297-‐if-‐i-‐had-‐asked-‐people-‐what-‐they-‐wanted-‐they-‐would (accessed January 2013 ).
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Consumers make purchase decisions based on emotions. Whether the purchase will make them feel guilt or a sense of giving will massively impact their choice.
Fig. 9- Ethical buying in the UK
But do consumers really care about brands? As much as a purpose helps to consumers something they want to associate themselves with, what is the proof they actually care about brands? “Almost every app built for a brand on Facebook has practically no usage…heavy, ‘immersive” experiences are not how people engage and interact with brands…heavyweight experiences will fail because they don’t map to real life”30 Paul Adams, Global head of brand design at facebook Businesses all use content in social media but Facebook, one of the most popular platforms, claims that only 0.5% of fans talk about brands online and of 200 brands studied only one showed a level of engagement over 2%. The main reason people interact with businesses on social media sites is for discount, not because they want to engage with the brand. To add to this, it’s reported that 80% of brand buyers know very little or nothing about the brand. Learning about brands isn’t important to them. It could be argued that consumers don’t care about businesses or want to spend time with them. However, it’s useful when a business consistently delivers on their brand promise, because it simplifies the purchase decision for consumers. The brand promise is critical to a businesses’ success; consumers know very little about brands so the little they do know has to engage them immediately. The importance of brand loyalty is heavily debated in the advertising world. The reality seems that if a competitor is more convenient then the loyal customer will go elsewhere. Consumers frequently jump from brand to brand even though they might consider themselves to be a certain brand’s customer.
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Fig. 10- Toothpaste brand loyalty
Consumers aren’t as loyal as most businesses think. No business owns a customer, they just merely taking another competitor’s customers away from them. Businesses often make the assumption that the few that are loyal are the most important; however the reality is that most brands need to focus on increasing the number of first time buyers, who don’t know much about the brand, as shown below.
Fig. 11- First time buyers/loyal customer for shampoo
77% people say they don’t have a relationship with a brand. So there is an argument against purpose that consumers don’t want to spend time with a brand or learn about it and have no intension of staying loyal. If consumers don’t care about businesses, why would they care about the brand purpose?
All comes down to the purchase decision It all comes down to the decision; the consumer is standing in the shopping isle deciding between one brand and its competitors. When consumers are deciding on what brand of cereal they are going to buy, they make that decision in less than 23 seconds.
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Though they might not fundamentally care about the brand, a moral and ethical brand with a purpose will always be chosen over the other at that point of decision. It’s in our nature to be good and do good to others, it’s what makes us happy. If the consumer was to make the decision rationally they would weigh up the benefits and drawbacks of each brand; but they don’t. They make an emotional decision based what they know about a brand and whether it’s meaningful to them; the purpose. In the 90s, Starbucks made the ethical decision to introduce Fairtrade into their shops. They gave consumers the option to choose Fairtrade at the till. They then changed their mind, taking the option from the consumers away and making everything Fairtrade. This removed the guilt aspect of the purchase which resulted in more people coming through the door. It was one less decision that the consumer had to make.
Is there any alternative to purpose? “Creating a new market for yourself would be an alternative to purpose”3115 Thomas Henry Getting to market first is another way to take an advantage over competitors instead of purpose. However, to create a market a business must create an innovative product or service.
Fig. 12- Creating a new market
31 Interview, Thomas Henry, Senior Stategist, Dare
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If a business is first to a new market, there’s likely to be some teething problems but over time the business learns and the brand grows. The business can get away with not knowing, and breaking brand promises with no purpose, because the consumers’ need for the new product outweighs this. As competitors join the market, they are automatically at a disadvantage. Not only do they need to learn everything the first business has already learnt, but at least 50% of the market share is already lost and the consumers now have expectation of a product. As more competitors follow into the market the more of a disadvantage they are at. However, the follower can close this gap by having a strong brand purpose. Competitors can offer the consumer a brand with a purpose, for example; the first mover may have invented coffee but the follower may offer Fairtrade coffee, giving the consumers a reason to consider the second brand.
How do you deliver a purpose? It starts from inside the business; the purpose must become part of the culture of the business. It must be consistent; from the CEO making sure decisions are made with the purpose in mind and leading by example, to the staff on the floor making sure they give the right customer experience. The purpose should engage the staff and delight the consumers. It’s pointless a brand having a purpose unless it’s delivered correctly. The consumer experience is critical when demonstrating what the purpose of the brand is. This has to be continued not just online but offline too.
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Barclays case study A great brand that has been built in the digital age is Barclays. Dare (advertising agency for Barclays) has taken the lead role for the account from BBH after helping them to define their brand purpose and turning Barclays’ fate around. I went in to interview the strategy team involved; Thomas Henry, Senior Strategist, and Nick Hirst, Joint Head of Planning, on the reasoning behind it. Thomas Henry spoke about strategies that deliver genuine benefits to companies and their customers. “I think the best way to do that is to help a company make a meaningful promise and then create experiences that keep that promise in useful or even delightful ways.”32 Thomas Henry In the digital age, the promise can easily be unpicked by consumer; we are better equipped to detect lies and fakery. Before that, finding out the truth about a brand was labour intensive, but now you simply have to Google it. Banking is a commoditized industry in which differentiation often happens at a price. Consumers traditionally go with the bank their parents went with and someone is more likely to get divorced than they are to change their bank. Since the financial break down in 2008 and the damaging Libor-fixing scandal in 2012, Dare have helped Barclays change their purpose from one motivated by profit maximisation to one which is more values driven. There was no hiding the wrong doing thanks to the digital age. And now, Barclays are constantly pushed to show what they are doing since the trust was broken. Before, banks played off each other by enticing new customers in with offers, but now Barclays has a meaningful role in consumers lives and a purpose to help customers achieve their ambitions, in the right way. “Gone from saying to doing, creating Your Bank”3316 Nick Hirst Your Bank allows consumers and employees to make suggestions for what they want from Barclays; from service improvements to showing art in the local bank. Barclays publically and directly answers the requests and explains the reasoning behind their yes or no decision. This display of transparency and willing to change has helped Barclays regain trust with consumers by working together to solve issues. 32 Interview, Thomas Henry, Senior Stategist, Dare 33 Interview, Nick Hirst, Joint Head of Planning, Dare
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“People need to see your purpose at work. For a bank this means everything and everyone who comes into contact with a customer or potential customer is a chance to either prove or disprove that your purpose stands for something. The way a complaint gets dealt with, the letter that announces your mortgage acceptance, the tone of a cashier’s voice all count towards your purpose being credible.” 3417 David Wheldon This example demonstrates a purpose not only benefiting the consumers but also, as a consequence, the business, the employees and the investors.
34 Part of interview with Thomas Henry & Nick Hirst
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Conclusion A brand is a promise to consumers. If the promise is kept then a relationship is formed that can be built on. However, if the promise is broken the trust and loyalty are broken too. As a result, brands live in the mind of the consumer, and their power does too. So consumers are able to make or break a brand because it exists as an idea in their minds. Brands are important to businesses because they are important to consumers; they help to simplify the purchase decision. To build a brand, three key factors are needed; consistency, persistence and restraint. Consistency so that every time the consumer comes into contact with the business the brand promise is reinforced. This promise needs to be persistently made to the consumer and the business must use restraint when tempted by opportunities that would break the promise. The digital age is changing our behaviour as humans, as generations of people become more dependent on it. As a result, it’s creating opportunities and threats for brands and businesses must adapt or die. A brand can be thought of as what people say about you when you leave the room. This room used to be tiny, made up of small social circles but the digital age has magnified that room; it now includes the whole world. Consistency has never been more important. The advantage of this change is that brands can now listen to what the consumer needs to gain more insights and can act accordingly. A clearly defined purpose helps to build a consistent brand in the digital age. A strong purpose combines the need to make money with the desire to improve the lives of the consumer. The idea that businesses can, will and are making the world better has now become an important part of what a brand is. The digital age has put the world at our fingertips, opening the eyes of the consumer to issues that would otherwise be unknown. This has brought about the rise of ethical consumption. People want to become more ethical and they expect businesses to help them to that. Building a brand in the consumers mind pays off at that moment decision, when a consumer is weighing up one brand against another. A strong purpose could be the deciding factor that gives one brand the edge. A purpose needs to be consistent within the business just as it is outside. It would be damaging to make a promise about a purpose if it was then delivered incorrectly. So the employees need to believe in it as much as, if not more than, the consumer.
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Barclays turned themselves around by redefining their purpose to build a stronger brand in the digital age. They have managed to build trust in the financial services category, which is dominated by a view that profit maximisation rather than fairness drives the agenda. They’ve adapted to the digital age, to deliver consistent experiences which reinforce the brand promise. That promise is aligned to a purpose; the meaningful role that the brand plays in making people’s lives better. This is how to build a brand in the digital age.
Brands are going from a world of saying, to a world of doing.
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Interviews -‐
Nick Hirst, Joint Head of Planning Dare
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Thomas Henry, Senior Strategist, Dare
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Lydia Reeves
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Andy Young
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Isabella Midgley
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Picture Credits •
Fig. 1- The original 1980’s Pepsi challenge <http://www.cbc.ca/ageofpersuasion/episode/season-5/2011/08/16/season-5-candid-commercials-real-people-inadvertising/ > (accessed, 17.01.14)
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Fig. 2- Graph showing the effects of share of voice to market share <The business of brands- Millward Brown PDF, www.millwardbrown.com> (accessed, 17.01.14)
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Fig.3- Fig.3- The history of Apple; entering into new categories by launching new products < http://en.ria.ru/infographics/20110401/163300288.html?> (accessed, 17.01.14)
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Fig.4- Nike+ Running app <http://nikeplus.nike.com/plus/products/gps_app/> (accessed, 17.01.14)
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Fig. 5- The TV generation < http://www.telegraph.co.uk/science/science-news/3353504/Black-and-white-TV-generation-have-monochromedreams.html> (accessed, 17.01.14)
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Fig. 6- Social experiments < Self conducted as primary research> (accessed, 10.01.14)
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Fig. 7- Nest thermostats <http://www.heavy.com/tech/2014/01/google-acquires-nest-labs/> (accessed, 17.01.14)
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Fig. 8- Youtube- Dove “Evolution” <http://www.youtube.com/watch?v=iYhCn0jf46U> (accessed, 17.01.14)
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Fig. 9- Ethical buying in the UK < GB TGI Clickstream 2013 Q1 (Oct 2011 – Sept 2012) (Pop) – Copyright Kantar Media 2013> (accessed, 17.01.14)
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Fig. 10- Toothpaste brand loyalty <http://www.slideshare.net/mweigel/how-to-not-fail-16647530> (accessed, 17.01.14)
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Fig. 11- First time buyers/loyal customer for shampoo <http://www.slideshare.net/mweigel/how-to-not-fail16647530> (accessed, 17.01.14)
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Fig. 12- Creating a new market <http://mcgeesmusings.net/2008/11/10/was-being-a-fast-follower-ever-aviable-strategic-option/> (accessed, 17.01.14)
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