Towards the end of the 1990s, the emergence of the Internet started to permanently transform brand-consumer relationships by giving consumers a more active and engaged role. The web facilitated access to information through price comparison websites, for example. It changed our relationship with time, which became more instantaneous, and it facilitated the sharing of information via discussion forums and email.
Against this backdrop, a massive surge of brands vied for an online presence but faced various technological and organizational constraints, as well as the market's immaturity when dealing with nascent e-commerce. In essence, the two main challenges at that time were to eliminate consumers' security concerns (payment and data transmission-related issues) and to attract consumers with more appealing prices than they would find in an in-store setting. Few brands at that time were talking about customer relations or user communities. In most sectors, online shopping accounted for a minority of all purchases, although it was growing at a rapid pace. The web channel served primarily as a showcase for brands. Very often it was managed separately, while stores retained their point-of-sale role.
15 Years after going digital: What are the implications for brand-consumer relationships?
Internet use has since grown in maturity and popularity. The mobile market has also exploded and, for consumers who are well-informed and enjoy good connectivity, reluctance has given way to eagerness.
Demand for quality of service, no matter what the retail channel
Today, when we buy a product or service online, we expect the same quality of service that we would get in-store. The first players in online shopping/e-commerce understood this very quickly. For example, Yves Rocher always highlights on its homepage payment security details, telephone customer service assistance, the possibility of returning products free of charge if a customer is dissatisfied, etc. For pure play online retailers, this requires substantial investment in logistics and IT systems, as well as in qualified staff, in order to manage their customer service.
Some brands go so far as to transform the merchant/outlet relationship by creating identical concept stores that promote the social connection rather than the act of buying. This is the case with Apple or Nespresso, where the actual physical stores look more like living spaces, with demonstration areas rather than checkouts. Everything is done so that the consumer feels at ease and spends time with customer advisers (not salespeople). Making a purchase is often implicit, even if this does not take place in-store but online.
Since there are multiple points of contact between a brand and its customers, good brand image management becomes truly crucial at all levels.
Internet users, by following a brand on Twitter, clicking 'Like' (Facebook) or '+1' (Google+) on a brand's page, are identifying themselves with it. The brand will then appear on their 'Timeline' or on their 'wall' beside their photos and their personal status updates: It would be difficult to get any closer to the consumer and their circle of influence. Moreover, with the 'Sponsored Stories' offered by Facebook, today's consumer is no longer a mere spectator but becomes an integral part of brand communication.
Today we talk about e-reputation. Indeed, every brand has a reputation associated with their online activity. For example, if a brand is too commercially aggressive on the Internet (i.e. too many banner ads, heavy use of unsolicited emails, etc.), its e-reputation could very soon be damaged. One of the consequences of this might be that all its email campaigns are unconditionally marked as spam, with a loss of ranking among search engines that take this aspect into consideration.
Demand for more personalized customer relations in near real-time
At the beginning of the 2000s, some brands were already offering community websites. Among the pioneers, Direct2Dell (still in operation) is an excellent example. It enabled Dell to become better aware of their customers' expectations -- customers could vote for the best idea to develop -- and to show them that their needs were truly at the heart of this development process. Today, with social networks, the concept has gone even further because a real 'personal' discussion with the brand is possible.
In times of crisis it is clear that some brands are better able than others to manage criticism and to bounce back once the storm has passed. Some community managers will reply with humor and sensitivity, rather than keeping quiet and later issuing an official statement. These interactions today form an integral part of Customer Relationship Management (CRM).
Brands that master the online world are not opposed to older digital marketing channels - such as email -- or to new ones, like social networks. Each channel has its use (communication, promotion, sales... ), and it is a lot more effective when creating a marketing campaign to combine them with a logical flow geared towards the consumer, who will use different channels to interact with the brand.
New Challenges for Brands
Businesses have multiple sources of customer data -- from store receipts and loyalty card information, to online forms and social networks. Collecting, sorting, organizing and analyzing this information is a major concern for marketers, whose aim is to better understand the customer and to figure out their buying motives in order to provide them with targeted offers. Customer-centric marketing is thus more complex and requires analytical and statistical skill.
Businesses are becoming increasingly adept at integrating internet-related tasks within their internal organization. We no longer talk about a 'webmaster' or a 'community manager' as isolated people in charge of web projects, but rather of integrated teams that are involved with the setting up of digital strategies (website coordination, managing a community) or with CRM. Such 'transversal' projects require highly specialized, technically competent people. Successful execution and management ensures homogeneity across the brand, thus better serving the customer.
From transaction to relationship -- or how to involve the customer
Better knowledge of consumer needs and motivations has led to brands developing new and promising concepts, like co-branding, co-creation, or even SoLoMo (Social Local Mobile). In the case of co-branding, Facebook and music streaming service Spotify partnered together at the end of 2011, combining their interfaces to offer an enhanced service together. In this instance, it was about people sharing the music that they listen to with their friends. Co-creation is what brands do to involve consumers in the process of manufacturing products -- brands like Nike and Audi are successful in this area.
Lastly, the acronym SoLoMo points to a new need for a convergence between social networks, geo-location and mobile devices. This is an emerging trend that will become entrenched in the coming years. It will allow businesses to develop long-lasting customer value by truly offering the right deal at the right time to the right customer. Brands like Converse in the United States are already winning this bet by, for example, allowing customers to use dedicated mobile applications to play their favorite music while in the store, or even to personalize the design of their new shoes.
The possibilities are endless. While brands still face many challenges, they should concentrate on these marketing strategies to attract customers and secure their loyalty.