Your digital strategy could betray your brand equity efforts
Do you do digital?
As consultants, one of the questions we often get from prospective clients is whether we are able to develop a brand digital strategy. The answer we give – which has probably already cost us a number of clients, and it’s probably arrogant – we don’t actually do a digital strategy, we do strategic work which has a digital component. Because focusing on one piece of the puzzle doesn’t give us a better picture of what the puzzle is. So, we keep true to ourselves and we try to have concentrate on the whole rather than on the single piece.
Unfortunately, this approach of “the piece of the puzzle” is not only happening with digital, it’s happening often with channel strategies, i.e.: trade marketing, mobile, on-premise. All of these focus on the smaller component, while improving efficiencies within their channel itself, however tend to reduce the overall functioning of the brand, as sometimes go as far as damaging the brand equity.
Brand Equity and its components
In order to understand our argument, we need to – first of all – provide a definition of brand equity, by making an argument for why getting brand equity right, is such a critical activity.
The traditional brand equity model is composed by three components. First and foremost, brand awareness, because – quite logically – nobody can purchase or fall in love with a brand they are not aware of. The second dimension is brand loyalty, which tracks consumers’ ability to choose one brand more often than the others within their basket of choice. And the third dimension, the most known and the most fundamental dimension of brand equity, is brand associations, which refers to the set of attributes making the brand unique and distinguishing it from the competitors.
The brand equity is important because of a number of reasons. For example, in the case of awareness, it is a key condition for familiarity. And familiarity, it’s a necessary condition for liking, which is from where the route to purchase funnel begins. Purchase is a derivative of liking and of the value for money perception. Liking is also key to creating stronger consumer bonds.
On the other hand, brand loyalty plays a very important role on both strategic and tactical levels. First and foremost, brands with higher loyalty tend to have a better return on investment. In addition to that, higher loyalty means, more predictable behavior from a larger consumer base, which can be leveraged in negotiating better conditions within the trade channels.
And finally, loyalty has a very important buffer effect, because on one hand it hampers threats from competitors while providing more time to respond to competitor’s actions. It makes the brand less vulnerable to the competitive landscape and to either strategic or tactical actions from competitors.
Finally, the importance of brand equity is also at level of a brand’s associations, because, at the end of the day, the association from either a qualitative point of view, or from a quality point of view, or from a context point of view, it’s what makes a product stand out; brand associations create a positive cycle (or a negative cycle), underlying the emotional bonds between the brand and the consumers.
Brand Equity and its “Digital Problem”
In this context, a digital strategy, which is disconnected from the overall brand strategy, tends to center exclusively on its own metrics. For example, a good digital strategy needs to convert. Conversion happens through a number of actions and tactics, most of which relate to content: the type, the length, the format.
The ideal situation would see content being derived from the brand attributes. In most cases that is not the case, because content is selected on the basis on its ability to become viral: one can often see brands commenting on the news, or riding content waves, which are off – equity. While building a brand is not an easy task, when one does not leverage the brand attributes, or is not enforcing them – and therefore reinforcing them – there is a real risk of diluting the brand equity. And, it’s pretty binary as a point of view.
In a nutshell, content which is not derived directly by brand equity is not content which is building brand equity. So, it might be driving conversion but it is also diluting the brand position in the medium to long-term period.
On the other hand, a good digital strategy needs to generate likes, shares, and retweets – depending on what social media we’re taking into consideration. This aspect is actually very important because we often take those numbers as trade success and as a proxy of the awareness of the brand. Unfortunately, we tend to forget that sometimes these actions first of all are the result of a disconnected habit, and they do not imply intent, neither at preference, consideration or consumption level.
In addition to that, all of those actions on social media tend to have no stickiness. The fact that they have no stickiness means that the brain does not hold onto them, long enough to process them. We don’t remember them. We don’t make them part of our repertoire of memories and that is why – very often – there is no link between most of these actions and the brand awareness.
As a matter of fact, a lot of studies have tried to find a correlation between social media performance and awareness, brand equity, brand evaluation, and none whatsoever has been found. Moreover there is a pretty efficient marketplace for buying likes, re-shares, re-tweets. In a nutshell there is no reassurance that those actions create awareness for anything but the content itself.
In conclusion, content should be of course driving conversions and likes, but should be only be a derivative of the positioning. It should not be chosen only with conversions in mind. This is why a digital strategy which is not derivative of the positioning itself – it’s actually betraying the equity effort for the brand itself.