A brand new approach to online success

In the wake of plummeting dotcom fortunes, good branding has never been more important, according to leading marketing experts.

But such a belief would appear to sit rather awkwardly with public perception. In the light of the Boo.com debacle, was it not an overplaying of the importance of branding that got so many online companies into deep financial waters, and which led to the dotcom panic in the first place?

But branding in the e-space has come to mean a great deal more than funky websites and a Californian-sounding name, as Dafna Israeli, chief executive at internet incubator iSmartlab, explained. "A brand is meant to be a shorthand for choice. By embodying the emotional and functional benefits of a product or service, it should help customers decide whether or not they want to make a purchase," he said.

With the internet market overcrowded and very undifferentiated, a good brand should communicate a long-term proposition to customers. Forget about a quick perception hit designed to secure inflated stock valuations. A good brand, if Israeli is to be believed, should help bring in the profits.

It is all the more important because of the high costs associated with winning over customers. Figures of up to $70,000 are regularly bandied about as the required spending to achieve such brand recognition.

Spending wisely
But research conducted by Greenfield Online on behalf of HMS Partners recently found that it's not what you spend that counts but how you spend it.

In Greenfield's survey, online auctioneers Ebay achieved 22 per cent brand recognition after spending $5.5m last year on boosting public awareness. This compares with Ameritech's spend of $107.7m to achieve recognition by one per cent of the survey's respondents.

Greenfield also found that so-called bricks and mortar companies have a head start when it comes to brand recognition. Barnes & Noble and Gap came out top, scoring almost 100 per cent.

But having people recognise your name is only part of the branding equation. What a brand means - and delivers online - is of more lasting importance, and bricks and mortar firms can be handicapped in this respect when they move onto the internet.

An ecommerce analyst at Forrester said: "Those sites that fail to deliver an experience that is highly correlated to the product or service represented by the brand will be rejected. No matter how good the games are at pepsi.com, it won't become any easier to quench a thirst there and site traffic will remain anaemic."

And branding priorities will differ depending on whether a company is an existing bricks and mortar operation with a ready-made reputation that it can bring online, or a startup with a clean slate. Here, we have condensed the tactics of some of the key players to come up with generic best practice guidelines.

Do:

• Use brand to establish trust with the customer. Core values should be expressed not only using web graphics, but in fulfilment. For example, research from the Future Media Unit at the London Business School found that 60 per cent of customer emails meet with no response whatsoever.
• Choose the right people to oversee the branding exercise. Agencies and individuals with experience of the fast moving consumer goods sector should have as good an idea as any of correct branding values.
• Think backwards from the point of view of the customer and then fill in the gaps. It's all about what they want from the proposition you are offering and absolutely not about how best you can sell your product.

Don't:

• Make over-optimistic projections because you fail to understand consumers' behaviour online. More than 50 per cent of people browsing the internet do not make a purchase.
• Make too much of a song and dance about marketing - you can end up sounding empty-headed and Californian. And don't be afraid to keep revisiting and tweaking your brand. It should not be a cold, academic exercise, but be open to renewal through interaction with customers.