Branding in the digital age: What is new. What is old. What is forever.

Brand_Digital_AgeHas the world really changed so much from the 31st of December to the 1st of January? Probably not, but typically this time of the year we are drowned in articles about two things 1) reviews of the ending year; and 2) trends and prognostications for the coming year.  Maybe the good thing about these crystal ball and rear-view perspectives is that they force us to stop and make some assessments about our current activities. I would like to focus on a particular subject – branding – and make a quick reflection on a particular phenomena – digitalisation – so we can discuss what is going on and what we should expect in this area in the coming years.

First, I would like to highlight that branding, as a discipline and business philosophy, is under a lot of changes (in this article I am necessarily generalist, so I´m talking about mass consumption branding, not branding in B2B, neither in luxury, to mention a few particular areas). As authors such as Holt (2010) or Kotler, Kartajaya and Sentiawan (2010) note, branding had firstly a functional orientation, where the product was the star; then an emotional orientation, driven by psychology and advertising; and now branding is facing the challenge of being socially and culturally relevant in a context of the “speed of life” as Interbrand new insight puts it. In this scenario, more unstable , brands are still a vital component in our economy and society, but there are factors such as the growing stakeholder’s scrutiny about corporations and marketing techniques, competition from private labels, the ideology of brand resistance, new habits of the post-recession consumer, and the role of technology, which, as a whole, mediate the relationship between brands and consumers and create a degree of uncertainty. This post will focus on the latter aspect, digital technology, and what I consider is new (our established) in this area, what is old (fads or unsuccessful approaches) and what is forever: principles that stay true and that digital can borrow from or simply enhance.

It is clear that digital has had a role in the latest two decades as enabler that is shaping a new paradigm in our relations with people, organisations and brands because it provides new spaces of socialisation, new channels to market products and new needs.

Branding is only effective, according to Schultz and Shultz (2004) when the company has a solid business model and a sound business proposition, when the product or service can be differentiated from competitors with a meaningful value proposition that is relevant to the customer. I guess we all agree that digital hasn’t changed these founding rules. But also, in my view, branding is a business process that the whole organisation carries out (and marketing can spearhead this process) and involves three basic marketing elements that we know as the marketing mix: the offer, the communication and the channels (pricing is part of this mix for sure but I won´t focus on this here for simplicity purposes). Therefore, when we add digital to these ingredients we can observe the following effects (from a consumer point of view):

  • Digital technologies can influence on the development of new products or services (physical or digital ones),  or digital features can be bundled/mashed-up with existing products, expanding their benefits.
  • Digital is now transversal to our socialisation spaces and affects our information and leisure habits,  being digital not an innovation thing per se, but the new normal (however the possibilities are in their infancy).
  • Digital, as a channel, provides access to the services and products that we need and the inter-relations offline/online are changing the customer experience and the way customers perceive the offer itself.

Considering these impacts, I came up with the following matrix that summarises my view on how digital is affecting  the three key ingredients (I use a little bit of the KISS analytical framework, too):

Branding_Digital_Keys

(Examples mentioned: Mastercard´s new campaign, Amazons Prime Air, Google Glass, L´Oréal new stretchable UV skin patch).

In conclusion, let´s start this New Year keeping in mind that the transformative power of digital in brands is real, and here to stay, but in the centre of the branding strategy it lies, as always, the customer and a brand ideology. To be effectively disruptive, digital needs to be used in a way that is aligned with a social disruption, and for that, we need to pay attention to the changes happening in our culture, a fantastic source of significant brand innovations.

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