The Internet makes equals of all of us. It enables small-to-medium enterprises (SMEs) to compete against the big boys and helps consumers to get past the marketing hype and see products and services for what they're worth.
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But to be a successful SME on the Internet, you have to get noticed. This is no mean feat, and certainly doesn't come cheap. Recent research from Shop.org suggests that while established bricks-andmortar firms spend £14 attracting a new customer, an online start-up, whether born out of a bricks-and-mortar presence or not, must spend £68. This is because the number of companies with an Internet presence is beginning to outnumber customers worldwide. The sheer size of the global online market calls for big money to be spent in order to grab peoples' attention.
That's certainly what the first wave of dotcoms had to do to make their mark. The high visibility of such brands as Boo.com would never have been achieved if they had behaved like other retailers. By spending vast sums the dotcoms became newsworthy phenomena and were guaranteed far more column inches in the press than they would otherwise have been accorded. What didn't do them much good was not extending their brands right through their businesses.
Most SMEs understand that they need a recognisable brand online - particularly to help provide differentiation, and to capitalise on first-mover advantage. However, they tend to choose a quick-fix brand solution over a more considered brand strategy early in the process, effectively doing too little too late, according to Richard Gold, head of new media, at global branding consultancy, Wolff Olins.
"Brands online are not the same as online brands," says Gold. "They need to work offline as well as online. It is not enough any more that a dotcom brand operates well simply on the Internet. The product or service needs to be able to exist across multiple platforms. There should be a fulfillment system in place that allows the brand to easily transpose to the high street."
Gold points out that most Internet brands differentiate themselves mainly on the basis of their advantages over older or slower ways of doing things. Very few companies understand that, using brand, can help develop the company's relationship with a 'community'. This is particularly relevant given that interactivity increases the possibility of creating communities.
Effective branding on the Internet is key because of the intangibility of the medium. In the absence of a physical product or service, brand can help create an emotional relationship between the provider and customer. The speed at which most Web sites operate often means that culture and vision is lost. A brand can be responsible for ensuring that these factors are communicated to a global audience.
"Brand is the conduit through which communication with this disparate audience can be made," says Gold. "At present, Web sites focus too much on technology. Branding in Web site design should be about more than logos and colours. It should be about behaviour."
Resist cool brands
SMEs should resist the temptation to try and create a cool dotcom brand and strive instead to create a good business model that can successfully deliver the promise of the brand. Such a model would consist of a big and simple break-through idea, able to be delivered in a compelling, visual fashion, and supported by best of breed technology.
Wolff Olins believes that only 5% of dotcom brands fulfill the above criteria at present. The company is advising a couple of start-ups that have delayed their launch because the three fundamental elements of a good business - technology, delivery, and brand - are not in place.
Diane Vandenburg, marketing director of Multimap.com, a provider of Internet-based maps, agrees that throwing money at branding online will not build a brand on its own.
"Building an online brand is not about how much you spend, but how well you define and deliver the service, and how effectively you communicate the proposition," she says. "You can't brand an online business unless the business offers a real benefit for its audience, and a demonstrable point of difference. In this respect, conventional marketing principles apply."
She adds, "Our difference is the simplicity and ubiquity of maps. They're delivered more efficiently via the Internet than any other medium. We've deliberately set out to ensure offline and online advertising, and our PR reflects this; we've used humour and warmth, rather than gimmicks to convey our message. We've concentrated on a very tightly defined audience of Internet users to make the most effective use of our marketing investment."
Vandenburg warns that the biggest pitfall most dotcoms fall into is to promise more than they can deliver.
"Customer expectations of service business are justifiably very high," she says. "If marketing activity sets higher expectations than you can deliver, inevitably you will fail, particularly since very few companies have been in the business long enough to build up the same levels of trust and confidence as leading real world brands. We need to ensure that our customers think more positively of our site after they have visited it."
Clearly, the company that carries its promise - its brand value - right through its business will gain trust and emotional identification with consumers.
"Dotcom brands need to be end-to-end," says Josh Pert, business development manager with Nucleus, e-consultants on branding, whose clients include Cable & Wireless,PriorityTelecom, VanPeterson.com and Superdrug. "The dotcoms must examine how they can support that which is now expected of them (low prices) with other value added services features, such as customer service, delivery speed, and one-to-one marketing."
For established offline brands, there is a mine field awaiting them as they go online - a mine field that can at first glance appear to be paved with gold. Choosing a new name for your online presence made sense in the heady days of the dotcom revolution when association with the old seemed to remove the shine from the new strategy, but in the cold light of the Internet shake-out, this doesn't look like such a hot idea, whether for large or small companies.
"All of a sudden, being connected with a 'good old' brand looks very attractive as companies realise that the trust built up by physical operations, where life spans can often be measured in decades or centuries rather than months, ensures them against many of the whims of investors, as well as consumer worries about security and reliability," says Pert.
So today it seems that if you have a good offline brand, however small your company is, it pays to use it for your online presence.
Make sure that your dotcom business isn't driven by brand alone but by its ability to deliver on its promises. If you can do that then the brand will take care of itself.
SMEs: how to build an online brand
Case study: Travelstore.com
The keys to success for branding any business include having a solid, clear proposition, and knowing and targeting your audience precisely. Online business travel experts Travelstore.com is at the stage where first mover advantage has become first mover competence, since it has refined its business model and has considerable operational experience.
"The technology capability that the Web offers is at best a short-term competitive advantage - choice, cost, and service is what it is all about. We have a mature and qualified management team with considerable experience in applying technology to complex processes in travel distribution," says Bill McFarlane, the company's president and CEO.
McFarlane attributes much of Travelstore.com's success to carrying the same brand throughout its clicks and mortar operations.
"We ran a highly targeted national advertising campaign this year, using the Travelstore.com goose as a symbol of the most frequent flyer, and communicating with business travellers in their own environment - in airports, at mainline railway stations and on taxis," he says. "This ensured that our brand values were maintained."
Case study: Urbia.co.uk
Urbia.co.uk is a pan-European family portal which went live in the UK last May. Hugely successful in Germany where it was first launched, now the site has a a growing following following in France. Urbia is aimed at families and provides services such as discussion forums, a magazine, online clubs for those with similar interests and related links to useful sites.
"The most important thing for a dotcom is to keep its brand values uppermost in its mind, and ensure that these are not lost in its marketing, advertising and PR campaigns," says Michael Stephanblome, managing director. "Too many dotcoms have fallen into the trap of creating strong brand awareness without truly communicating what it is they do. For example, Boo.com - we all know the name, but how many of us associate the brand with fashion?"
"Too much money is ploughed into expensive 'clever' advertising which does nothing to communicate the real value of the brand."
"Urbia's approach has been to use advertising to create awareness and rely on PR to convert this awareness into real understanding. Our top priority in advertising - for example, in baby changing rooms - has always been to communicate our key message in clear and certain terms, which is that 'Urbia is family'. That way people can be in no doubt about what we do."
He adds, "Logos should not be extravagant or complicated but simple and easy to remember. Urbia's logo is two-dimensional and can easily be recognised whether replicated in colour or black and white. That's not to say there is no room for fun, innovative ideas in the dotcom world - far from it, but the idea of clarity and simplicity in branding must be carried through to your logo."