May 15, 2014

Is Brand Power Waning? (Part Two)

Is Brand Power Waning? (Part Two)

Guest Blogger: Ashley Wiederhold

Many industry leaders have long expected brands to lose their power as consumers become increasingly knowledgeable about their products, services, and behind-the-scenes activity, thanks to the World Wide Web. As an article published by the Harvard Business Review so aptly explains: “The case for the decline of big brands follows a strikingly clear logic: The primary role of a brand is to make it easier for consumers to choose which products to buy. If consumers have immediate access to information that helps them make those decisions[,] such as user reviews and expert opinion, the value of a brand will fall.”

At first glance, this may seem to be a strong argument. Think about it: When do you rely on brands? Perhaps when you are shopping for something and don’t know much about the product (i.e., you buy a Dyson because of brand recognition and reputation, not because you’re a vacuum cleaner expert) or when you’re in a hurry and don’t have the time to do your research (i.e., you need to quickly pick up a can of green beans and simply grab the variety you recognize).

But, as the aforementioned article points out, the Internet, which is the primary location of the information that consumers access when making key financial decisions, is also highly brand-driven: “As digital disrupts more marketplaces, brands become more important and more valuable. Take a look at the various brand rankings: Digital brands such as Apple, Google, Microsoft, IBM, Intel, and Samsung are in the top 10 of most rankings […] If brands are truly unimportant in a digital world, why is it so brand dominated? Why do so many people choose Google search over Bing when only experts can tell which has the most accurate results?”

The strong power that brands wield is, of course, the answer. But instead of leveraging traditional branding and marketing tools, today’s companies need to take their brand image online. The article puts it perfectly: “It’s about providing meaning and satisfying emotional needs. These fundamental human needs have not changed.” But the ways in which companies are able to meet these needs have changed—and drastically. Meeting these needs is now largely achieved via the Internet, rather than traditional advertising methods.

Before wrapping this up, it’s important to touch on one more idea, which was discussed in part one of this two-part defense of brand power. Because consumers have access to so much more information, it’s critical that companies uphold the brand image that they create by acting upon the values, mission, and attributes that they have chosen for their brand to represent. The article corroborates this, stating: “In a hyper-transparent digital world, consumers instantly know the difference between what a company says and what it does.”

The moral of this two-part story? Brands are important—nay, essential—in the Internet Age.

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Brands Aren’t Dead, But Traditional Branding Tools Are Dying,” Harvard Business Review

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