Wal-Mart’s Web woes prove that leveraging the Internet is tricky for even the savviest of retailers. Meanwhile, consider what the virtual online world has done for the drawing power of auctions. Clearly, the Web has changed commerce forever, in both subtle and dramatic ways. The question raised by a new study is: What does the Web mean to the future of brands?
Conducted by TBWA/Chiat/ Day of North America and Norwalk, Conn.-headquartered research firm Yankelovich, the nine-month study, which was about to be formally released at press time, concluded that consumer priorities and expectations change depending on whether they’re online or off. In other words, what people want when they walk into a store differs from what they expect when surfing the Web. For a brand to succeed in both the virtual and brick-and-mortar worlds, companies must tailor their online and offline products and services accordingly.
"The Web is the great equalizer among brands," said TBWA/ Chiat/Day chief marketing officer Laurie Coots. "This study is information we can use today." In addition to providing her clients with pertinent info, said Coots, the research will help agencies better understand what should be included in advertising messages, and what points aren’t as relevant.
Coots outlined the findings of the study last week (3/13) at the Digitization & Distribution of Media & Entertainment (D2ME) Forum, which was part of the Internet World Spring 2001 convention in Los Angeles.
Defining "brand" as the emotional relationship a company has with a consumer, Coots explained that the study was designed to address several questions, among them: What is the impact of the Web on brand perception? Are there universal drivers of—or sweeping statements we can make regarding—brand equity? Does the "Internet-ness" of a brand or a consumer affect the relationship between the marketed product and a potential customer? And are certain brands in certain categories more poised to benefit from the Web?
The study comprised 200 phone and more than 2,100 online interviews that each lasted 25 minutes. The average respondent was 34; all participants had purchased a car or a computer in the past 12 months, and had also made an online purchase in the past year.
Among the highlights of the study was the finding that the brand equity of Yahoo! and E*Trade was nearly as high as that of longstanding traditional brands such as Sony and Charles Schwab. Coots said they also discovered that when people surf the Web, they often lose track of what site they are at. Similarly, people often identify their location by a category such as "car dealers" (70 percent of the time) or a search engine such as Yahoo! (53 percent of the time).
Based on the research, Coots concluded that there’s no equity in the Internet itself, so companies should "either do the Web well or don’t do it at all." Moreover, a company’s Web presence should be appropriate to its brand, products and services. For instance, the study found that the most popular airline Web site was that of Southwest, because the site’s no-frills style echoed the company’s successful offline product and image.
Some of the surprises unveiled by the study, according to Coots, included the findings that people’s opinions about a brand were not influenced by: a company’s investment performance record; whether a company has a hot Web site; whether a company makes online purchasing fun; whether it offers 24-hour-a-day customer service; or whether a brand represents unique taste and individuality. She also said respondents didn’t expect every company to be online; they expected companies to do what is appropriate to their categories of products and services.
The study also took into account the Internet experience of respondents. Those ranked as having high Web involvement logged onto the Web at least once a day, while low involvement was defined as logging on a few times a week. Coots said high Internet involvement affected brand perception, especially when it came to the purchasing process.
The study also defined two tiers of brand equity drivers: universal and category specific. The importance of these drivers—such as "provides personalized information"; "is seen as an industry leader"; "makes me feel valued"; "offers customized products"; and "is a company you know and trust"—rose and fell as consumers moved from the offline world to the Internet. For instance, in the investment category, when people moved online, they cared more about feeling like valued customers and less about the brand being one that continually introduces new products and improvements. Meanwhile, conversely in the consumer electronics category, the study showed that customized products and services became more important to people online, while they cared less about whether the brand is seen as being for people who know what’s good.
The study also demonstrated that when it comes to brands, people have deep attachments and can become emotional when threatened. "We heard very unemotional explanations when people would be talking about a brand," said Coots. "But if we had them close their eyes, and asked how they would feel without it, words cropped up like ‘isolation,’ and ‘I’m not as good,’ and so on."
Finally, the study differentiated between the transactional experience and the ownership experience. Not surprisingly, the primary drivers of brand equity in the transactional realm were found to be things such as convenience and ease of doing business. Whereas past the point of purchase, brands are enhanced when they’re perceived as being the smart choice and worth paying more for.
Coots suggested that in the virtual arena, "Universal brand equity drivers will always be important. But a Web strategy must capitalize on category equities." She continued, "There’s no way to expedite the relationship process, to turn shoppers into buyers faster. People will move through phases in the consumer/brand relationship; it’s a lot like dating. You must build an architecture that allows consumers to move in and out on their own."
