Chapter 5 Market Communications and Branding. ZOP-MKX-Branding BIC Report-10/12/99-NLM Confidential...

Chapter 5

Market Communications and Branding

ZOP-MKX-Branding BIC Report-10/12/99-NLM

ConfidentialWork in Process

2

Exhibit 5-1: Evolution of Customer Buying Process

Early Web Market

Communication

television ads general interest

magazines

niche magazines

collateral

point-of sale promotions

direct marketing

product experience

buyers’ clubs

television ads general interest

magazines

Traditional Market

Communication

Source: Forrester Research, Monitor Analysis

Consideration Consideration Preference Preference Purchase Purchase Loyalty Loyalty Awareness Awareness Buying Process

buttons banners sponsorships

banners microsites brochureware web site

daily specials sweepstakes first-time order

incentives

e-mail alerts newsletters



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Table 5-1: Framework for Marketing Communications

DirectDirect PersonalizedPersonalized

Broad

Individualized

Off-line On-line

CommunicationMedia

Audience Focus

Traditional Mass Marketing

Traditional Mass Marketing

General Approaches

General Approaches



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Table 5-2: The Four Categories of Communications

DirectDirect

Traditional Mass Marketing Traditional Mass Marketing Television Radio Print Billboards Superior Customer Service

Television Radio Print Billboards Superior Customer Service

PersonalizedPersonalized Permission Marketing Personalized Recommendations Personalized Advertisements Personalized Web Pages Personalized Upsell Personalized E-commerce

Permission Marketing Personalized Recommendations Personalized Advertisements Personalized Web Pages Personalized Upsell Personalized E-commerce

General ApproachesGeneral Approaches Banner Ads E-Mail Viral Marketing Portal Sponsorship/Exclusive Agreements Associate Programs On-line and Off-line Partnerships Provide Information to Entice Customer Purchases Leverage Customer Base

Banner Ads E-Mail Viral Marketing Portal Sponsorship/Exclusive Agreements Associate Programs On-line and Off-line Partnerships Provide Information to Entice Customer Purchases Leverage Customer Base

Salesforce Retail sales Customer service reps



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Supporting Slide 5-A: Quotes on On-Line Branding

“E-branding is more important [than e-commerce]. And it must come first. Because few people will buy your stuff -- on-line or off -- unless you are top-of-mind.”

-- Annette Hamilton, Executive Producer, ZDNet

“Brand is the price of entry [to the internet], not the winning strategy.”-- Dylan Tweney, InfoNet

“By the time your potential customers log on, they already know what they're looking for, and they often know from whom they want to buy it. . . They're just not listening to branding

messages anymore.” -- Michael Fischler, Principal of The Pubs Group “Brands stand as comfort anchors in the sea of confusion, fear and doubt. In dynamic

markets, strong brands have more value than ever, precisely because of the speed with which these markets move.”

-- Chuck Pettis, Technobranding

“It took more than 50 years for Coca-Cola to become a worldwide market leader, but only five years for on-line search engine Yahoo! to gain market dominance. The role of the brand has changed dramatically and has created a vacuum between off-line and on-line brands.” -- Mark Lindstrom, Executive Director ZIVO

“A company's web site IS the brand. It's the hub of consumer experience, the place where all aspects of a company, from its annual report to its products to its support, intersect. It's the company in a nutshell, all there in a way that just is not possible in the analog world.”

-- Sean Carton, Carton Donofrio Interactive



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Supporting Slide 5-B: Do Strong Brands Matter On-Line?

Point — CounterpointPoint — Counterpoint

Brand is EssentialBrand is Essential

Flood of new entrants. Too many brands. Hence, need to build your presence.

Strong brands -- customers come to you vs. you chasing customers.

All winners currently have strong brands.

It is an “instant message” that contains a lot of associations.

Conversion rates. Clear brand associated with higher conversion rates.

Flood of new entrants. Too many brands. Hence, need to build your presence.

Strong brands -- customers come to you vs. you chasing customers.

All winners currently have strong brands.

It is an “instant message” that contains a lot of associations.

Conversion rates. Clear brand associated with higher conversion rates.

Brand is Side-showBrand is Side-show

Alliances lock-up the market. Considerably more important than brands.

Third-party evaluator sites decrease power of brand (e.g., bizrate.com).

But… we expect a lot of well-known brands will go “belly-up” (e.g. beyond.com, FreePC).

Speed is more important than brand. Need to build customer base.

Everything about customization. It is a “personal” brand experience.

Alliances lock-up the market. Considerably more important than brands.

Third-party evaluator sites decrease power of brand (e.g., bizrate.com).

But… we expect a lot of well-known brands will go “belly-up” (e.g. beyond.com, FreePC).

Speed is more important than brand. Need to build customer base.

Everything about customization. It is a “personal” brand experience.



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Exhibit 5-2: Banner Click-Through Rates

0.40

0.45

0.50

0.55

0.60

0.65

Apr May Jun Jul Aug Sept Oct Nov Dec Jan

Banner Click-Through Rates (Apr 1999-Jan 2000)

Note:Source: Nielsen-NetRatings



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Exhibit 5-3: What Is a Good Brand?

Brand Prestige

“Wrap-arounds”

Marketing Communications

CoreCoreProduct /Product /ServiceService

Mix of off-line and on-line advertising

Emphasizes advantages to AAdvantage memberships, including non-expiring miles and on-line services

Superior service AAdvantage frequent flier mile club Award winning Admirals Club lounges Comfortable chairs Portable defibrillators on every flight

Safe, on-time transportation from A to B



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Exhibit 5-4: A Simple Conceptual Model of Brand Equity

A good brand...

CUSTOMER BENEFITS Confidence Loyalty Satisfaction

FIRM BENEFITS Reduce marketing costs Increased margins Opportunity for brand

extensions

BRAND AWARENESS Depth Breadth

BRAND ASSOCIATIONS Strength

relevant consistent

Valence Uniqueness

memorable disinctive

“Wrap-arounds”

CoreCoreProduct /Product /ServiceService

Market Communication

… provides positive consumer responses...

… and benefits both target customers and the firm

Source: Keller (1996), Aaken (1996), Strategic Market Research Group, Marketspace Analysis



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Table 5-3: Types of Brands

Traditional BrandsTraditional Brands On-line BrandsOn-line Brands

The product / service with which the brand is associated was established in the online world

Examples:

– Amazon

– Yahoo!

– Chemdex

– ZDNet

– AOL

– Priceline

– CDNow

– Wingspanbank

– E*Trade

The product / service with which the brand is associated was established in the online world

Examples:

– Amazon

– Yahoo!

– Chemdex

– ZDNet

– AOL

– Priceline

– CDNow

– Wingspanbank

– E*Trade

The product / service with which the brand is associated was established offline in the bricks-and-mortar world

Examples:

– The Gap

– UPS

– Dell

– JCrew

– McDonalds

– OfficeMax

– Ragu

– Coca-Cola

– Disney

The product / service with which the brand is associated was established offline in the bricks-and-mortar world

Examples:

– The Gap

– UPS

– Dell

– JCrew

– McDonalds

– OfficeMax

– Ragu

– Coca-Cola

– Disney



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Exhibit 5-5: Brand Presence

Traditional Brands

On-line Off-line

Online Brands

Source: Monitor Analysis

Mix of Promotional Activities

ProductEstablishment

Yahoo! Yahoo!

Ragu Ragu

Yahoo! Magazine

Wingspan

bank

Wingspan

bank

Schwab Schwab

Egghead Egghead



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Exhibit 5-6: Building an On-Line Brand

1. Clearly define the brand audience2. Understand the customer3. Identify key leverage points in customer experience4. Continually monitor competitors5. Design compelling and complete Brand Intent6. Execute with integrity7. Be consistent over time8. Establish feedback systems9. Be opportunistic10. Invest and be patient

1. Clearly define the brand audience2. Understand the customer3. Identify key leverage points in customer experience4. Continually monitor competitors5. Design compelling and complete Brand Intent6. Execute with integrity7. Be consistent over time8. Establish feedback systems9. Be opportunistic10. Invest and be patient

Integrated Campaign

Value Cluster



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Table 5-4: Similarities and Differences in Off-Line vs. On-Line Branding

Branding Element Off-line On-line

1. Clearly define the brand audience

Limited to manageable number of segments to prevent inconsistent messaging

Could include larger number of segments, with customer driven messages

2. Understand the customer Requires understanding of environment, desired purchase and usage experience

Requires more thorough understanding of desired purchase and usage experience in an interactive environment

3. Identify key leverage points in customer experience

Buying process is typically a simplified representation of customer segment behavior with static leverage points

Buying process tends to be more dynamic and flexible

4. Continually monitor competitors

Requires monitoring of competitor advertisements & activities

Competitor advertisements & activities can be monitored online

5. Design compelling and complete Brand Intent

Brand intent (desired positioning) is designed to address the needs and beliefs of target segments

Greater opportunity for customization of key messages



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Branding Element Off-line On-line

6. Execute with Integrity Strong, positive brands are built up overtime

Online interactions bring in addedconcerns of security & privacy

Limited familiarity with on-line brandsmakes fostering trust more difficult

7. Be consistent over time Brand intent guides marketingcommunications

Image reinforced through variety ofoffline media

Brand intent guides marketingcommunications

With the ability to customize, onecustomers’ brand image may bedifferent than another customer’s brandimage

8. Establish feedbacksystems

Collecting and analyzing customerfeedback is more time consuming

Sophisticated tools exist for trackingonline; allow for anonymous, interactive,quick feedback

9. Be opportunistic Marketing strategy includes plan forsequenced growth and adjustment ofbrand based on changing customerneeds

Customization for multiple segmentsand opportunity for early recognition ofchanging customer needscorresponding tailoring of brand intent

10. Invest and be patient Building brand awareness requiressignificant investment

Building brand loyalty takes time offline,especially because early customerreceptivity to brands is difficult to assess(and usually involves market research)

Building brand awareness requiressignificant investment, especially forthose competitors who are not first intheir category online

Brands have the potential to generateloyalty more quickly, especially ifcustomers are targeted effectively

Table 5-4: Similarities and Differences in Off-Line vs. On-Line Branding, cont’d



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Table 5-5: Case Studies of Successful On-Line Branding Efforts

Established as TraditionalBrand

Established as On-line Brand

BrandingOn-line

Branding andSelling On-line

Intermediary /Vertical Portal

E-commerce

Businessto

ConsumerRagu American

AirlinesMonster.com CDNow

Businessto

BusinessFedEx Cisco Systems Healtheon Ventro



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Brand reinforce-

ment

Brand reinforce-

ment

Broad vs. Focused (specific

products / services)


products / services)

Brand association

Brand association

Brand awareness

Brand awareness

Firm Benefits Firm Benefits

Customer Benefits

Customer Benefits

Product sales Product sales

Sales leads Sales leads

Brand creation

Brand creation

Product trial Product trial

Store traffic Store traffic

What value do you want to derive from

your on-line presence?

What part of brand equity do you want to

build?

What product / service are you offering them?

Value Objective Component of Brand

Equity Product Scope Target Audience


segments)


segments)

Who do we want to target?

Exhibit 5-7: On-Line Branding Choices

Source: Forrester Research, Monitor Analysis



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Supporting Slide 5-C: Point-Counterpoint: New Brand vs. Use Existing Brand

Point — CounterpointPoint — Counterpoint

New BrandNew Brand

An existing brand name limits the size of the user base

A single company brand name cannot be the “objective, third party portal (I.e. Travelocity will atract more visitors as compared to AA.com)

Existing brands are less likely to “get it” (e.g. less usable interfaces)

An existing brand name limits the size of the user base

A single company brand name cannot be the “objective, third party portal (I.e. Travelocity will atract more visitors as compared to AA.com)

Existing brands are less likely to “get it” (e.g. less usable interfaces)

Use Existing BrandUse Existing Brand

Enormous amounts of time and money are necessary to build new brands

Customer understands and will respond to a known brand

Customer will understand the value of being able to use both on-line and off-line services interchangeably

Target customers will not be confused

Enormous amounts of time and money are necessary to build new brands

Customer understands and will respond to a known brand

Customer will understand the value of being able to use both on-line and off-line services interchangeably

Target customers will not be confused



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Exhibit 5-8: www.aa.com



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Exhibit 5-9: Assessment of Key Branding Elements

Key Elements Rating Rationale Rating Rationale

1. Clearly Define theBrand Audience

Specifically targets AAdvantage members –highly profitable and loyal customers familiarwith travel (and thus more likely to buy ticketsonline)

Targets both high spending business customers, aswell Onepass members, and non Onepass members

2. Understand theCustomer

Constantly anticipates and innovates to meetthe needs of the customer

Tends to be a “follower” in the industry, late inlaunching its website (6/97)

3. Identify KeyLeverage Points inCustomerExperience

Net SAAvers and new customization programleverage consumers desire for finding cheapfares into transaction by sending out e-mailseach week

Sends C.O.O.L. e-mails similar to Net SAAvers andadded a personalization feature to the site, but lateidentification of this leverage point has result insignificantly lower subscription rates

4. Continually MonitorCompetitors

In one of the few cases a competitor adopted atechnology before American was quick to follow

Tends to follow what competitors are doing at a slowerpace, launching “copy-cat” initiatives many monthsafter competitor roll-out

5. Design Compellingand CompleteBrand Intent

Focus, stream lining, and ease of use of website all convey American’s message of customerneeds first

Unclear target segment (business travelers? OnePassmembers?) causes lack of clarity with Brand Intent

6. Execute withIntegrity

Trust fostered in the offline world carries overinto the online world

Trust fostered in the offline world carries over into theonline world, with extensive information for memberson privacy and use of provided information

7. Be Consistent OverTime

Although constantly innovating newtechnologies and features, stays true to“something special online”

Different URLs for different portions of the site do notconvey message of consistency

8. Establish FeedbackSystems

Customer service offered as a service at the topof each page in small letters, but is not labeledas a specific menu item

Very easy to access, prominent feature for obtainingcustomer feedback on the website

9. Be Opportunistic Leader in its industry in innovation and

development Follower in the industry

10. Invest and BePatient

Invests significantly in technology for the future Has a tendency to wait too long to make changescompetitors make to their sites

On-line Branding Best-in-Class Comparison

American Airlines Continental

CVc= very low = low = moderate = high = very high

CV

CV



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Exhibit 5-10: Assessment of Key Brand Attributes

Key Attributes Rating Rationale Rating Rationale

1. Relevant

Up to date flight and gate checkinformation

Personalized information based onAAdvantage profiles

PDA applications with flight information

Offers only information for Continentalairlines, but does offer bookings forrental cars and hotels

Allows travel preferences to be saved inprofiles

2. Distinct

Availability of competitor information Offers highly personalized experience First to offer tie in with PDA applications

Offers extensive online customer serviceoptions

Offer customized services for thebusiness traveler

3. Consistent

Portrays an image of something “specialonline”, consistent with its image ofoffering something “special in the air”

No key messages online associatedclosely with the offline campaign

4. Memorable

Provides a unique service others cannotoffer (in terms of personalization)

Net SAAvers is the most well known andeffective e-mail marketing tool

Multiple URLs associated with the siteand lack of online / offline messageassociation fail to create a cohesivelymemorable brand for the consumer

On-line Branding Best-in-Class Comparison

American Airlines Continental

= very low = low = moderate = high = very high



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Exhibit 5-11: www.monster.com



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Exhibit 5-12: Assessment of Key Branding Elements

Key Elements Rating Rationale Rating Rationale

1. Clearly Define theBrand Audience

Within the employer market, targets all types of companies, fromstart-ups to large corporations

Appeals to a wide range of job seekers,but it specializes in the intern and entrylevel positions

2. Understand theCustomer

Offers highly personalized services for the job seekers,addresses security concerns, and offers value added services(resume help, advice, interactive communication with other jobseekers.)

Only site to offer privacy feature whichallows job seeker to select whichcompanies have access to their resume

3. Identify Key LeveragePoints in CustomerExperience

Provides interactive career information for customers that are notnecessarily “looking,” thus increasing the probability that they willbecome job seekers

Allows recruiting process to becomeinternal through Hotjobs.com and itsproprietary Softshoe technology, andeliminates concerns about adding anadditional venue for recruiting

4. Continually MonitorCompetitors

Currently a leader in providing unique services to its consumers,but does not have some features that competitors do

Adopts successful features of theMonster.com site, but usually on a lesserscale

5. Design Compelling andComplete Brand Intent

Message of “there’s a better job out there” combined withdiversified strategic alliances and “intern-to-CEO” strategyconvey the idea that Monster.com can find you that better job

Message of “all the hottest jobs at all thehottest companies” was overshadowed inthe spring with controversy overtastefulness of ads which were rejected bynetworks

6. Execute with Integrity Offers password and ID protection, as well as some ability to

selectively decide when and where your resume can seen; Offers most specialized security measures

for individual users (prevent currentemployers from viewing resume)

7. Be Consistent OverTime

In the short time since “there’s a better job out there” messaging Recent “Hottest Hand on the WebCampaign” different from past brandingmessages

8. Establish FeedbackSystems

Offers extensive feedback system for users, allowing users toeven selecting categories of information / feedback

Also offers feedback mechanism forusers, although less specialized

9. Be Opportunistic Partners with firms that could potentially be competitors, rather

than trying eliminate competition Took a risk with Super Bowl advertising,

even without a compelling ad campaign,to raise brand awareness

10. Invest and Be Patient Willing to invest heavily in the offline world to gain brand

recognition Also willing to invest in the offline world to

gain brand recognition

Online Branding Best-in-Class ComparisonMonster.com Hotjobs.com



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Exhibit 5-13: Assessment of Key Brand Attributes

Key Attributes Rating Rationale Rating Rationale

1. Relevant

For job seekers: Providesinformation for individualsregardless of whether or not theyare actively pursuing a newposition, including careerinformation, and chats with othermembers on various career topics

For job seekers: Provides informationgeared more specifically for thoseindividuals that are seeking positions

2. Distinct

For job seekers: Aids in resumebuilding, personalization with “MyMonster” pages and enhancedprivacy options; also offersopportunity for interactivecommunication with othermembers

For job seekers: Allows selection ofcompanies which view your resume

3. Consistent

Recent partnerships have beenconsistent with Monster.com’s aimto provide the most diverse set ofindividuals with the most diverseset of employment opportunities

New “Hottest Hand on the Web”campaign, although new and catchy,has not been consistent since thecompany’s beginning

4. Memorable

Witty and award winning offlineadvertising have allowedMonster.com to cement itself asthe best known online career siteon the web

Although also one of the most wellknown online career services on theweb, has not been as successful asMonster.com in creating a uniquelymemorable advertising campaign andmessage

Online Branding Best-in-Class Comparison

Monster.com Hotjobs.com

Chapter 5 Market Communications and Branding. ZOP-MKX-Branding BIC Report-10/12/99-NLM Confidential...

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