Outlook: Online: It’s Not Your Mother’s Branding Medium

Online advertising has grown rapidly in the past three years. Much of that growth has come from direct response advertisers using it to drive transactions through the digital channel. The discreet measurability of online marketing, combined with proven high return on investment, has made it an easy decision.

However, the industry is seeing a major shift of brand dollars from offline media to online advertising. This change is being driven by several factors: concerns about the fragmentation and declining efficiency of television; rapid increase in broadband penetration; and mass online audiences that deliver significant reach.

Most importantly, there is recognition that new, high-impact online ad units can engage consumers in a way that is emotional, memorable and persuasive.

New Bottle, New Wine

As with most major shifts, there’s good news and bad news. The good news is that online advertising is finally being recognized as a major medium, capable of delivering high-impact messages to a large, receptive audience. The bad news is that many advertisers are making the mistake of bringing their traditional approach to brand advertising to the online channel.

Take a look back in time. As late as 10 years ago, most advertisers had a clear idea of how to reach their best customers and accomplish their brand advertising goals. For large national brands, the most common method was to use network television to create awareness, preference and purchase intent at the top of the sales funnel. In this interruption and intrusion model of communication, customers were bombarded by whatever communication companies cared to share with them.

Customers rarely talked back. They had little capacity to learn about companies or products in ways not officially sanctioned or desired.

Those days are over. This top-of-the-funnel, one-way communication approach doesn’t work in online advertising. It’s not enough to take a TV commercial and repurpose it for online. Brands that take this approach leave themselves open to competitors who do the hard work to understand the digital consumer and to respond to his/her needs.

The Consumer Is in Control

Digital technology has given customers access to a plethora of information and options, making them smarter, more empowered, more demanding and harder to find. If consumers aren’t interested in what you have to say, they can tune you out with pop-up blockers, filters or simply use search tools to jump to another site at will. With new technologies like digital video recorders and video on demand, they can skip your message entirely.

However, if consumers are interested in seeing what a company has to offer, prepare for a rigorous analysis. They will check out the company’s Web site, the competitors’ sites, as well as the store. They will read catalogs, scour independent reviews, do research, talk with other customers and call customer support.

And when it comes time to purchase, these consumers will compare each offering with others that may be around the corner or around the globe. Plus, they will share their experiences – good or bad – with the rest of the world through discussion forums, blogs and rating systems. Increasingly, their experience defines the brand.

Building a brand online requires that companies jettison the timeworn one-way model of communication and reinvent how they initiate, sustain and support this dialogue. This new brand conversation must be orchestrated across the full range of digital touch points: Web advertising, search, Web site and e-mail.

That’s why the smartest online brands are taking extreme measures to listen to customers. They’re using sophisticated technology and analytics to watch consumers to see whether their behavior matches their professed beliefs. Also, smart marketers are building carefully crafted definitions of the ideal digital experience, customized and personalized for each major customer segment. Then they pair that knowledge with innovative technology and high-impact, interactive creative to create a lasting, high-value customer conversation.

In doing so, these smart online marketers are crafting a new discipline of brand marketing, one that is adapted to the unique opportunities and challenges of the digital world this year and beyond.

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