Currently, according to these two articles, branding is no longer about ensuring consistency by communicating the consumer experience. Instead, branding is all about stimulating desire and shaping the customer experience (Interbrand, 2018). The two articles highlight the fact that enhanced information technologies and changing market trends and dynamics have forced enterprises to rethink their approach to branding. Business organizations must learn to be brave to leverage available opportunities and harness all their capabilities to effectively respond to the needs of the marketplace. This brief report highlights some of the most important ideas featured in the two articles in relation to branding.
1. Customer-Centricity and Competition Consumer Attention
Currently, branding is done as a response to consumer needs. The goal for branding in any business is to evolve the business concept and model to not only appeal to the needs of the consumer but also effectively accommodate them. Consequently, the desire to co-create solutions with customers has led to increased competition for consumer attention. Brands want to be relevant and responsive to consumer needs (Interbrand, 2018). Therefore, the pursuit for excellence and commitment to accomplishing consumer needs has fueled competition for consumer engagement. Given that consumers have greater choice to many markets due to reduced barriers (attributable to the internet), the switching costs between brands has been lowered tremendously forcing enterprises to compete for increased brand loyalty. Consequently, brands are strategizing by creating experiences, targeting real people, rethinking the use of media, embracing authentic brand purpose, and closing the gap between brand and commerce.
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2. Branding is Driven by Data and Technology
According to Morris (2018) branding in the digital age is driven by digital technologies and data analytics. Brands currently utilize technologies to generate a better understanding of customer experiences, demands, preferences, tastes, and overall needs. Morris (2018) further states that data is an enabler that gives businesses the ability and capacity to establish new growth opportunities. The goal of using data is to reach out to real people instead of basing the marketing strategy on proxies and uncertain market segments. The digital technologies have been instrumental in eliminating barriers to entry thereby establishing conditions for near-perfect competition between producers and consumers. Unfortunately, the digital technologies also present a set of new challenges in branding including potential data breaches and the malicious use or misuse of consumer data (Morris, 2018). Nevertheless, basing branding on digital technologies and data maximizes the value of consumer relationships. Furthermore, in most cases, it provides businesses with a competitive advantage over their rivals who still use conventional strategies.
3. Positive Utility and Customer Experience
As indicated earlier, branding is no longer about telling consumers about the benefits of a product. Interbrand (2018) argues that leading brands are built around the ability to solve consumer problems by directly appealing to their needs. Marketing is, therefore, a tool to serve rather than sell. Branding, nowadays, is influenced by the desire to create a meaningful and positive impact on the customer experiences. Customer-centricity is achieved when a brand directly appeals to the needs of the consumer. Therefore, through branding, the business should be able to deliver a relatively higher level of utility. The objective is to achieve higher levels of utility that transform the customer’s experiences and relationship with the brand. Morris (2018) agrees that creating customer experiences is vital in branding processes. According to the author, business enterprises should invest in creating campaigns and ideas that connect emotionally with customers rather than simply pushing messages to them. The customer should understand how well the brand or products meet his/her needs or how it solves their most immediate problem(s).
4. Challenges in Branding and Marketing
Despite the fact that digital technologies and data analytics drive branding and marketing, businesses should be aware of the immense risk associated with these innovations. Currently, Morris (2018) acknowledges that there are major concerns about digital media effectiveness. The lack of standards, increased risks of internet fraud, unreliable measurements, and lack of transparency in media supply chains significantly hinder effective utilization of digital technologies in branding and marketing. Furthermore, most CMOs report that securing long-term investment has become a huge problem, especially concerning the delivery of a marketing strategy and branding. Branding based on consumer needs mostly requires a business to deliver short-term results more than build a long-term brand proposition (given that consumer needs and market dynamics may change in the long-term). Another significant challenge for CMOs is working with marketing agencies. The agencies have created unnecessary complexities for brands making it cost-ineffective for businesses to work with them. Consequently, marketing agencies should try to ease the burden for brands while acknowledging the competitive cost pressures they endure.
Undeniably, therefore, both articles highlight the evolution of branding and marketing as significant business concepts. The authors underscore the need for business to leverage new opportunities in the digital economy and establish brands that transform customer experiences and relationships with the brand. Branding should be customer-centric and focus on attracting customer attention. Customer centricity has led to increased competition for customer attention. Furthermore, branding is currently driven by digital technologies and data analytics. Businesses base their branding on consumer needs and market dynamics generated through digital tools. Consequently, the goal of branding is to generate positive utility and transform the experiences of customers. Businesses should be aware of the new challenges in branding such as the risk of using digital technologies.
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References
Interbrand. (2018). Activating brave. Learning from the bold and the brave. Retrieved from https://www.interbrand.com/best-brands/best-global-brands/2018/articles/activating-brave/
Morris, N. (2018). How brands win in the digital economy. Dentsu Vegis Network. http://thoughtleadership.dentsuaegisnetwork.com/?edmc=354