A. Tybout and G. Carpenter ‘Creating and managing brands’

Question

Tybout and Carpenter talk about three different kinds of brands. What ways will these benefit from the Internet?

Answer

The first type of brand is the functional brand, which focuses on resources, a product and its superior qualities or the place and price of a product. Advertising for such a product should emphasis its superiority, but this is not the basis of functional brands. Instead, aspects like improving the performance and adding new functions in one product are. Especially the last element is important in out time of age, because people’s free time is decreasing. Here, the Internet comes in to play. It is much easier to go online and compare prices than it is to go and visit a number of different stores and compare different product brands. That would take up too much time. Companies could cut into this by using websites to communicate what makes their products more effective, what its amazing new functions are and whether they are cheaper than others. A website is a very useful tool for this, because it is clear and easily accessible. Companies could stimulate user response by encouraging visitors to suggest improvements of their products.

Image brands focus on certain associations and usually are connected to highly visible products, like clothes. The quality of these products is hard to evaluate, because of the emotions attached to the products. Image becomes more important because of the lack of meaningful differences in products due to competition. The Internet can be a very helpful tool for companies that sell image-related products. For them, the Internet is a great way to find out what is on the minds of their potential buyers, by visiting their weblog for example, perhaps even participating in it. Tybout and Carpenter already mention the possibility for image brands to gain greater affiliation, by building websites that allow users to participate and interact with like-minded users. The Coke Music site is a good example. By allowing visitors to play games with their own avatars, their awareness of the Coca Cola brand, with its many associated values, is enlarged.

The third and last type of brand distinguished by Tybout and Carpenter is the experiential brand, like theme parks and restaurants. This type of brand focuses on how people feel and is therefore highly personal. Experiential brands differ in valence, potency and involvement, even in the terms of bodily engagement. The difference between online and offline experience is that the online experience is less labour-intensive; there’s no need to train recruits. This is an advantage. The big disadvantage would be that the potency and contact of an online experience could never be as great as a real-life one. An online roller coaster is hardly exciting. I therefore think the Internet can do little more than create an awareness of the existence of the sort of experience that would normally involve great potency. Tybout and Carpenter also call fan sites a form of enriching an experience. I agree, but this kind of experience is entirely different from theme parks or drinking coffee (the Starbucks example), because there was no engaging of the body in the first place. Perhaps the Coke Music site can be seen as offering an experience, by allowing players to mix their own music. The way the Internet can be used in the branding of an experience is therefore very reliant on the kind of experience that has to be promoted.

G. Dafermos ‘Blogging the market: how weblogs are turning corporate machines into real conversations’

Comment

G. Dafermos speaks of the way weblogs could be used in founding a new sort of managing. For example, employees of Macromedia, manufacturer of programs like Flash and Dreamweaver, have their own weblogs. There, users can ask for help and can discuss aspects of the Macromedia products with other visitors and with the employees. The blog’s community managers can easily point out the top topics, run promotions or even ask visitors for their opinions on new plans. For Macromedia, this way of communicating works very well, but I doubt it will for many other companies. It may in certain sectors, like the computer- and software branch. Here, a lot of people will want their practical questions answered and the weblog is an efficient way of doing so. Other branches might not benefit from blogging. For example: I find it highly unlikely that the costumers of a company that sells curtains or furniture will feel the need of discussing this with others buyers or the manufacturers. I doubt therefore, that blogging will actually revolutionise the managing world.

Sean Nixon ‘Re-imagining the ad agency’ (Cultural Economy H7)

Question

Nixon discusses the way the economical changes in the 1990’s caused a questioning of the commercial value of advertising. Aspects like the globalisation of the market and marketing as well as competition from other groups of intermediaries forced advertising agencies to think of different ways of reaching costumers. Internet was one of them. Is the Internet as an advertising tool less susceptible to changes in the economy?

Answer

Internet advertising is much less expensive than a television commercial. Especially because the costs of television airtime are so dependent on the program the ad is aired in. Of course a company will want as many possible costumers as possible to see their ad. Popular airtime is expensive though. The Internet does not have this problem to such an extent. Like A. Tybout and G. Carpenter say in their article, the costs of an interactive Internet site for the Super Bowl cost tens of thousands of dollars. A television as however, cost about 1,2 million dollars. So, Internet advertising is much cheaper and therefore allows even small companies to get a lot of attention. Does this make online advertising a better choice in economically harsh times?

I think there are two problems. First, companies will probably adjust their marketing budget according to the decline in advertising costs. That would still mean that there would be less of a budget in times of recession, because costs have to be divided evenly among all branches of the company. Also, I don’t think that the Internet as an advertising tool can function properly without some sort of created awareness before hand. People have to be alerted to the existence of a product before they will start surfing to a particular website. That would mean that a company would still have to make use of television (as seen on TV), or another medium for ads. These ads will still cost a lot of money that is not available at such times. And, of course, even if the company could still afford to advertise in periods of recession, there has to be a public willing to buy their product, which will not be the case at such times.