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The Promise in Digital Branding

(originally published by Booz & Company)

A brand is a promise, and history shows that strong promises can create lasting bonds with consumers. Across 21 consumer product categories studied last year, 17 of the brands with No. 1 shares in 1923 were still in the top three in 1998. Can digital brands, which are continually shifting their product or service offerings, and even their value propositions, possibly have the same longevity? Yes — but only if their stewards understand that customers, not products, are the essence of the brand.

The history of successful offline franchises shows that branding is neither easy nor accidental. The 17 top brands that survived the past 67 years — their number includes Kellogg's, Kodak, and Gillette — may have changed during that period, but their underlying value proposition has remained fairly consistent. For example, from the launch of the Brownie camera in 1900, through the Instamatic, the single-use camera, and now PhotoNet online, the Eastman Kodak Company has continued to strive to make photography ubiquitous and fun.

Where offline brands have succeeded through stability, digital brands have stressed change. That's a big obstacle for a new brand with no links to a consumer base. It's hard to create an emotional connection with something that is constantly changing (consider how few people end up marrying their childhood sweethearts). Yet digital brands, subject to competition from every corner, at any moment, have no choice but to evolve continually.

To overcome the problem, electronic brands must stretch beyond their products or services to promise a timeless benefit relevant to a specific consumer segment, but extendable to adjacent segments over time. More concretely, consider the following thought-starters:

1. Recognize that, if successful, your brand will be around much longer than your current offering. Inc. is no longer specializing in what it sold on day one — but you and I still think of as a bookstore!

2. Develop your promise instead of promoting your wares. For example, online brokerages may want to rethink brands built only on cheap trades and fast information access. How about targeting the financial do-it-yourselfer with a promise of safety, privacy, high-quality information, and value?

3. Do relevant consumer research. Make sure the segment you are targeting will continue to be viable five years from now. Where, for example, are the techies who started this whole thing? Where will today's MP3 fanatics be in 2005?

4. Look for higher-level positioning themes. Build an emotional bond with your consumer that goes beyond the Web's current reliance on price and convenience. Michelin sells tires by talking about babies, not rubber.

5. Favor methods that enhance dialogue — either between you and your consumers, or among your consumers — over one-way communications like TV or banner ads.

6. Consider the "option value" of your brand, and invest in areas that will maximize and extend your brand's potential. Even after the recent tumble, most e-commerce valuations are a function of opportunities grander than the initial product or service offering can support. The key is to stop assuming that the upside of the brand (its option value) is infinite, and to deliberately position the brand against a set of possible future offerings — even before knowing which ones will pan out.

Horacio Rozanski,
Horacio Rozanski is a vice president of Booz-Allen & Hamilton based in Cleveland. He specializes in developing marketing strategies across a range of industries.
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