The Death of Branding Online?

November 24th, 2004 by Bob Bly

I know a lot of the brightest marketing minds in the world, and Don Libey is certainly one of the top five, in my humble opinion.

So, not being a big branding guy myself, I enjoyed the latest issue of Don?s ?Secrets of the Catalog Master? bulletin, published by list broker Merit Direct.

In it, he basically says that branding is dead or dying on the Internet, being replaced by (what else?) ROI-producing direct marketing ? driven by Google.

Don says, ?Buying is no longer a matter of who [the brand or reputation of the seller] ? Shopping is a matter of word description. In other words, I will no longer associate buying pears with Harry & David.

?Instead, I will associate buying pears with the words ?pear? or ?fruit? or ?gourmet pears? or any of 58 other words or word combinations.?

He also credits E-bay with diminishing the important of online merchant reputation — as millions of people are sending money to other people they?ve never heard of and have no reason to trust simply because these sellers have a five-star rating on E-bay.

Don calls this kind of buying ?thought-activated word shopping? and says it is replacing branding in importance for consumers.

I imagine you branding folks out there are cringing, and you search engine optimization guys are cheering. I?m not at all convinced that Don is right. What do you think?

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This entry was posted on Wednesday, November 24th, 2004 at 5:00 pm and is filed under Branding. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

56 responses about “The Death of Branding Online?”

  1. Steve Slaunwhite said:

    The fact that you apparently broke some one-day record with your blog demonstrates that branding is not completely dead on the Web. People didn’t visit in droves because this is a copywriting blog or a marketing blog. They came because this is Bob Bly’s blog. Like it or not – you’re a brand.

  2. Marc Orchant said:

    Steve’s right Bob. Henceforth, we will refer to you as Bob “The Brand” Bly ;^)

  3. Yvonne DiVita said:

    Branding, as it was known in that ancient Dick and Jane world of the 20th century, is dead. YOU are the brand. What you sell is secondary to who you are. We live in an age of personalization…people associate the item or service with YOU…hence, the Bob Bly brand and its effectiveness. Despite the eBay model, where it seems as if folks don’t know the merchant, the reality is that they trust Meg Whitman. SHE has built a brand that says, “We’ll protect you, or intercede, if necessary,” hence, folks will purchase from complete strangers. Branding experts may be cringing, but if they don’t change with the times…they will get left behind.

  4. David St Lawrence said:

    1. The reputation system that ebay developed (feedback ratings) is simply a shortcut for the traditional brand system. It accomplishes the same thing and the merchant can develop or ruin a reputation in a very short time.

    2. Search engines have replaced directories. You can Google for “Harry and David” or for “pears”. If you sell premium versions of commodity products, you have to get very bright and figure out how people will find your pears instead of someone else’s.

    3. Brands do not always transfer well to other market segments. You are a brand to reckon with in DM. Your success as a blogger depends on what you bring to this new Commons. I think you have it in you to do well.

    Good luck.

  5. Platinax said:

    Am I the only one to see any incongruity in the comments that “branding is dead” on the internet? Especially in articles where a comment, such as:

    “Buying is no longer a matter of who [the brand or reputation of the seller”

    is then followed by name-dropping of heavily branded entities such as Google and Ebay?

    Branding isn’t dead on the internet – it’s always been a long-term investment – as Google and Ebay have proven. This is all in a market environment where short-term goals are claimed as paramount – but short-term goals will always prove inefficeint and over-priced without longer term goals. This is where branding plays.

    Just that too many people are looking for results today, when marketing should be about today, tomorrow, and the day after…

  6. th0th said:

    I AM COMMENTING ON THE SECOND ENTERY EVER MADE BY BLY, LORD OF MARKETING.

  7. Matt Biskup said:

    I made a post in the first article that Bob posted about blogs that included some discussion on branding (my post is #91) click mbiskup@fast-arrow.com
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  8. Irv Brechner said:

    I wonder if we should be talking about a new paradigm to more accurately replace DR vs branding: the trackers vs. the trackless. As the need to measure marketing performance has become a mandate among ALL types of companies, the ability to track advertising results in some fashion becomes paramount. Whether an ad is designed to make a sale, capture an email newsletter subscriber, or some other action, I believe all ads will be measured in some fashion.

    I think CEO’s will be asking for and getting these kinds of letters as online becomes more and more entrenched in the world of advertising and marketing:

    From the “trackers” group:

    Dear CEO:

    Last year you allocated $100 million to our group, which we spent in various online activities and other places that we could track. We can without question say that our efforts resulted in $750 million in direct orders, 32 million email newsletter subscribers added to our database, 139 new dealers added, and much more (detail attached). Please increase our 2005 budget to $500 million.

    Signed, The Trackers

    From “The Trackless” Group

    Dear CEO:

    Last year our budget was $1 billion and we spent it on TV, magazines and other media (see scheduled attached). Our branding studies show people remembered our slogans, recalled specific ads, and in some markets we could tell that the needle moved when big campaigns were run. How much it was moved as a result of our ads, we really can’t say. But our bean counters tell us we’re selling more beans so it must be as a result of our work. Please double our budget to $2 billion.

    Signed,

    The Trackless

    As a CMO of a company that produces offline-to-online tracking software and systems, we see how the ability to track all media (i.e. which worked better, $100K spent on a TV campaign, $100K spent on direct mail, $100K spent on Google or $100K spent on banners) is critical in this day and age of media fragmentation. The Trackless group will be hard pressed to keep their budgets from being taken by The Trackers. Anyone experiencing this now?

  9. Paul Chaney said:

    As a consumer I put very little emphasis on the brand selling the item. I do put some emphasis on the brand of the product I’m buying, however. I mean, I don’t want to buy a piece of junk. Being very price conscious, that tends to be the criteria I use most often.

  10. Michael Stephanblome said:

    1. The question is not whether branding is dead. The question is whether it is neccessary to build a brand by advertising.

    2. Branding and efficient direct response are not contradictory: Great advertising leads to brand building AND positive direct response ROIs.

    3. eBay and Google both are great examples of experiental brands – the equity is build through the USP users actually experience.

  11. Al said:

    You really have to be kidding me about this death of online branding thing right? E-bay has not killed and never will kill merchant rating. Merchant rating was never an end-all be-all factor in online purchasing. It was the factor that sealed the deal after such factors like price, availability, etc. If you worked for an ecommerce company and got to see the customer service side, you would know. And eBay still uses merchant rating. You fail to take into account that eBay users are not shopping for regular stuff. They are looking for something specific, a perceived bargain, something hard to find. Your eBay user is different from your online shopper shopping at Amazon or doing a price shopping on the shopping portals. And as for branding online – banner ads still serve as powerful branding vehicles. Targeting the ads with consistent colors, logos, and fonts (not necessarily size), in relevant sites is important for building branding. If I was a stock broker, I would target my banner ads to investor news, wealth-building sites, investor sites, etc. Then, later, I would consider periperary/related sites. But a consistent advertising campaign on sites targeted to my market is strictly what I need to develop branding online. Look at any report and the top online companies are branded companies.

    ROI-driven direct marketing has it’s limits – just like snail mail direct marketing or any direct marketing. People online are perceptive to when they are directly marketed to, and if they dont like it, your plan backfires. ROI is important to gauge how well you’re doing, but to eschew branding and go to strictly ROI-driven is nonsense. It’s possible to lean more towards ROI-driven, but within that frame, you need to build your branding in there. Pure ROI is like those guys that go door-to-door selling promotional coupons to homes or businesses – it works, but you can’t rely entirely on it.

    So no, online branding is not dead – and anyone who wants to say that guarantees that they are wrong and will be humiliated.

  12. Michael D. Pollock said:

    Great conversation. Thanks for the question Bob.

    First of all, I don’t think branding can ever be dead, online or offline. IMO, branding is simply a business term for something that’s a natural part of human nature. People can’t help but form a GUT FEELING (Marty Neumeier’s definition of a brand in “The Brand Gap”) about other people, companies, products, etc. When someone mentions or asks you about this person or that company or that product, you already have an opinion/gut feeling about that person, company or product, assuming you’ve had some expereince with it/them directly or indirectly.

    The other relevant fact is people are just different. Some people buy brands BECAUSE they’re brands. Some people don’t care about brands. They want the best price. Roy Williams wrote an excellent post on the subject recently (http://www.brandingblog.com/2004/12/monday_morning_.html) in which he made the distinction between transactional customers and relational customers. IMO there will always be (at least) these two types of consumers, so there will always be a need for investment in both branding and DM.

    Branding folks may tout the superiority of their craft while DM folks do the same. But the reality is, as marketers, we need them both. Lets not be too hasty in killing off one or the other.

    Thanks again for the question Bob. I love my copy of The Copywriter’s Handbook as much as my copy of The Brand Gap.

  13. Search Engine Optimization Consultant said:

    As someone who’s bread and butter is search engine optimization, I have to admit that I don’t think “thought-activated word shopping” is anywhere near *replacing* traditional shopping mindsets. However, it certainly has brought a new dimension, and may signal a shift toward a greater trend in the future.

    One thing I will say about SEO and ROI, though, is that my clients are always delighted with the fact that they get direct reports on the performance of keywords, visitor (traffic) numbers, conversion rates, etc.

    In traditional marketing, there is an joke that goes “I know that half of my marketing budget is responsible for 100% of my new sales — the problem is, I don’t know which half!” In the search engine marketing paradigm, this joke thankfully no longer resonates.

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