Not long ago, a major focus of marketers was on brand—brand loyalty, brand positioning, the “brand promise.” Numerous books were written on the subject—each claiming to be the “brand bible” for communicating effectively to target markets.
We would argue that brand loyalty and the importance of brand, in general, is diminishing. According to McKinsey Research only 13% of customers are “loyalists” who do not shop around.
Sure, there are Apple aficionados who will never buy a Windows PC. There are folks who continue to drive the same brand of car for decades. And there are businesses with brand preferences due to corporate policy or hardware and software compatibility challenges. However, with the ubiquity of online shopping and buying, brand-based selection is falling, time and again, by the wayside.
Why is this?
When seeking a new product—especially a product with which a buyer has had little previous experience—buyers most often rely on the opinions of family and friends, or complete strangers. In fact, in one study by Signpost, they found that 90% of people consult online reviews when making purchase decisions. With the anonymity afforded by the Internet, purchasers of a product can be completely frank about their opinions and experiences with a product. As a result, buyers frequently trust those opinions more than corporate advertising or “brand communications.”
Not only is UGC an influential factor, but so are third-party reviews. How frequently do you make a major product purchase without consulting Consumer Reports, Edmunds, CNET, or the like? Buyers are relying more and more on the expert evaluations of third-party reviewers for three main reasons: 1) they can be accessed from our desk or mobile phone; and 2) these folks do this for a living and are experts; and 3) it speeds our research and decision processes.
What is also common is for buyers to be surprised by what they read. According to the same McKinsey Research study, nearly 60% of customers switched brands once they began “shopping around.”
Ability to Compare Products
Now that consumers and business buyers can easily shop around and compare products—on price, features, and form factor—at the click of a button, they are not restricted by brand. Online users can find the product that most closely meets their needs—whether the purchase transaction occurs online or in-store. Again, this may mean that they consider or purchase a brand that was not originally top of mind. However, after validating their purchase through user and third-party reviews, this previously unknown brand or product may indeed end up the winner!
What Can You Do?
As a manufacturer or distributor, the most impactful thing that you can do is portray your individual products in the best possible light. If you are no longer able to attract customers based solely on your brand, then you need your products to be able to speak for themselves and tell their own unique stories. This requires compelling, well-crafted product descriptions, accurate and interesting imagery, and insightful product testimonials and reviews. Let inRiver and our extensive PRIME Partner Community help!
Kathryn Zwack, Sr. Content Marketing Manager, inRiver
Digital has evolved from simply enabling the business strategy to actually driving business strategy. One of the reasons is that digitization simplifies the removing of intermediaries from the traditional supply chain—one that typically consists of a manufacturer selling to a distributor that, in turn, sells to a retailer that sells to a consumer. This phenomenon of removing intermediaries in the supply chain—such as manufacturers selling direct to consumers by cutting out distributors and retailers—is called disintermediation. Simply put, disintermediation eliminates intermediaries whose cost to service has become greater than the value they provide.
I believe that disintermediation is, to a large extent, a consequence of the transparency that the vast amount of readily available product information creates. It empowers the end-customer and makes it fast and convenient to compare offerings by product properties and price—regardless of seller. By removing actors from the supply chain, disintermediation decreases cost and allows the manufacturer to both increase margins and, at the same time, create a direct relationship with the end-customer.
However, it is not only the manufacturers that are taking advantage of disintermediation. Retailers like WalMart and marketplaces like Amazon are also working on reducing the number of intermediaries in the supply chain. There are even credible rumors that Amazon plans to launch a global shipping and logistics operation that will compete with UPS and FedEx, thus creating disintermediation in the logistics industry itself.
In some cases, it is more efficient to use a distributor for shipping smaller orders than going direct. The economy of scale makes certain products and order types hard to manage without the services and facilities that a distributor provides. However, in most cases, it works fine to ship direct or use drop shipping, resulting in distributors being bypassed by manufacturers and retailers. However, in the transparent marketplace, brand value is rapidly diminishing, making it easier for a retailer's private labels to compete with the well-known brands from the manufacturers. Diminishing brand value coupled with disintermediation creates a threat for the branded manufacturers that they need to acknowledge and address if they want to earn the consumer’s business.
I think it is safe to say that disintermediation is affecting distributors more than manufacturers and retailers. However, all actors can and will be affected and need to rethink their value proposition and strategy. Disintermediation is eventually inevitable for all intermediaries whose cost becomes greater than the value they provide, and a big part of the value is the customer experience. As one of the key drivers for disintermediation is information transparency, it is crucial to provide more and better information than your competitors in the supply chain. There is, of course, more to it than that, especially with respect to organizational and logistical challenges. But if you are not getting found and providing a stellar product and customer experience, nothing else will matter.
Johan Boström, Co-founder and Evangelist, inRiver
It takes two to tango. That phrase may be a cliché, but whether you substitute “tango” with “foxtrot,” “pas de deux,” or “mazurka,” the fact remains—you can’t market to customers who aren’t listening to you.
Your customers have high expectations about their digital experience across every channel and touchpoint with your brand. First, they need to find you, which means you need to know how they are searching for you and your products—when, how, and what. That takes work.
Then, once a buyer finds you, you need to be sure that you are providing the information that they are looking for—you need to listen to them first, before they will listen to you. Today’s online experience requires that you give customers the information they need, when, where and how they want it. And if you have underlying product information issues of data quality, inaccuracy, or incompleteness, it impedes the seamless and frictionless experience and message that your customers are seeking. You need to organize your content to align with customer personas during key intent-driven micro-moments.
We call this unified experience “brand choreography.” Once you do that, you can hit the dance floor. This is the key to differentiating your brand, and growing your online sales.
To help you lead this ensemble of e-commerce efforts, a troupe of digital commerce experts hosted by Earley Information Science’s Chief Digital Strategist, Jeannine Bartlett, will participate in the March 2017 Earley Executive Roundtable. This panel will discuss the brand choreography issues that marketers, e-commerce leaders, and operations executives need to understand and address when embarking on product and digital asset programs, including:
Don’t miss out on this opportunity to learn more creating a great commerce experience for your customers. Register for the March 2017 Earley Executive Roundtable webinar: Brand Choreography - How Product Information Supports Your Brand Promise to be held on March 15 at 1PM EST/10 AM PST.