A Broader View of Offshoring

Many Western execs see only cost savings when they can learn so much more from Chinese and Indian companies Offshoring has been a hot topic in recent months, as Western companies have cut tech labor costs drastically by shipping such jobs to countries like China and India. But the trend means more than just job loss at home or short-term wage arbitrage for the West. In their book The Only Sustainable Edge ($25, Harvard Business School Press), John Hagel III and John Seely Brown argue that the rise of the tech industry in China and India will lead to the creation of formidable overseas competitors. The advantage has less to do with sheer population figures, they say, and more with the differences in how these new powers do business.


Brown is the former director of Xerox's Palo Alto Research Center. Hagel, a former McKinsey & Co. consultant, is the author of several books on the Internet and competitiveness. Recently a group of editors and reporters from BusinessWeek sat down with Hagel to discuss how the East is changing technology in business, and what Western companies can do to keep up. Following are edited excerpts from that conversation:

Q: What was the idea behind the book?
A: I think executives are viewing offshoring much too narrowly. John Seely Brown and I had been collaborating on some broader, strategic questions. The book is primarily targeted to business executives. The fundamental theme is that companies should be shifting how they see strategic advantages. If I have a particular skill, fine. But the real source of advantage going forward comes from figuring out how to build on that capability and refresh it more rapidly than anyone else.

Q: So what's an example of a company that has this dynamic?
A: There's one we focus on in the book, called Li & Fung, in China. Li & Fung works with clothing designers. Calvin Klein, for instance, will tell them what its new line of fashion is, how many units it needs at what price points, and where the distribution points are. It takes care of everything else. Their initial advantage was being able to access a lot of different suppliers and orchestrate their activities. But over time, they've recognized that the value they can provide is to help their partners become better at what they do. It's not just figuring out what a particular customer needs and organizing the right set of resources. For example, cutters will start to have conversations orchestrated by Li & Fung with weavers, and say, you know, if you wove the yarn in a particular way, it would make our cutting operations a lot more efficient. And so they'll have these kinds of interactions [and] deepen their skills at what they do -- to coordinate their activities better -- that's one example.

Q: Couldn't you make the counterargument that their true competitive advantage is sitting within a nation of 1.2 billion people who do this kind of work in textiles at the lowest cost? It's really a geographic advantage?
A: You could certainly make that case, and there's an element of that. Their partners are located in 35 different countries around the world. So a lot of it has to do with geographic proximity. If you're dealing with an apparel designer in Europe, you want to have operations that are closer to the end customer than China would be. But it's also about creating the flexibility of organizing these resources.
One of the interesting stories around Li & Fung was: Immediately after 9/11, they had a fair amount of their operations in countries like Pakistan that were at high risk in terms of political instability. Within three weeks they had moved all the operations that were time-sensitive out of the Pakistani partners and into countries that were more politically secure. That degree of flexibility [in reaction to] unanticipated events is a skill set that most Western companies don't have.

Q: Which Western companies have been good examples of that ability to be flexible?
A: There are relatively few. Cisco Systems on their customer-relations side has thousands of very specialized channel partners. They'll work with the customer to configure systems, qualify the needs of the customer, and then they'll decide which of their thousands of partners are appropriate to serve that particular customer. Nike has also done a good job of orchestrating a similar global process network. It's focused on identifying very specialized providers of the various materials and on how they're assembled into shoes.

Q: You say giants like India and China take over innovation and come back to compete on Western soil. But isn't the vast majority of science research and technical innovation still performed in the U.S., Europe, and Japan?
A: A large amount of technical innovation is still occurring in the West. I think what's driving the innovation in countries like China and India is much more of a boot-strapping mentality of, again, rapid incremental innovations. That tends to argue against basic research and long-term research investments and [focuses] much more on: What can I do quickly to build my capability and add more value? And increasingly, what we're seeing are large companies in the U.S. and Europe setting up research facilities in China and India to do advanced research. What happens is the pattern that we saw, for example, in software development in Bangalore. Initially, U.S. companies came into Bangalore to do software development, but over time the people that were trained in those facilities set up their own ventures. Entrepreneurship took root. Now those companies are competing against the U.S.

Q: So what are some of the things Western companies should be learning from offshoring?
A: Rather than doing it purely as wage arbitrage, where you're just looking for contract low-wage labor, think about it as a way to access distinctive skills, in a much more distributed fashion -- and focus on partners who can build their skills much more rapidly. If you talk to most Western executives about emerging markets like China and India, they'll say they're strategically important. "They're real growth engines," and so forth. We think that's accurate. These markets are providing a catalyst for product innovation and process innovation. Either you're the attacker, or you're going to be attacked by companies with more innovative products.

Branding on Internet

How do you turn your Internet real-estate investments into a thriving Brand?
Make sure you have a strategic approach to reaching your customers.

Ask anyone to cite the strongest brands on the Internet. Google, Dell, Amazon.com, e-Bay, Yahoo! and America Online will top the list. The world's most famous brands Intel, Microsoft, HP, Cisco - high-technology companies with big commitments to the Internet will not make the cut. The most recognized brands on the Internet exist, well, only on the Internet itself.
In the early days of the World Wide Web, newcomers just elbowed their way in. They did not have advertising budgets - indeed, many did not have budgets at all. They survived on the buzz created first by Internet surfers, then by the media.

Fast forward to 2005: Businesses have discovered cyberspace. Technology giants Intel, Cisco, Microsoft have spent millions on Internet - to create a strong brand name & presence. While spending big bucks to create a strong brand name is feasible for established companies, small firms or startups have to innovate to create their brand name and a strong brand presence.
All companies, competing now against tens of thousands of Web sites, need more than a buzz to create a significant presence. Word-of-mouth is no longer sufficient to get the word out; Traditional advertising plays a large role. Television, radio and print have to be used to complement the web site.

Strong brands have to be seen everywhere, with their Web site featured on television advertisements, radio and stationery. Integrate all modes of brand communication with a sense of purpose to create a strong brand.

INVESTMENT FOR BRANDING

The cost of creating a Web brand is escalating quickly - ranging from $1.5 million to $3 million, according to Forrester Research. Competing with an established brand can push those figures into the stratosphere. Entrepreneurs may have to spend big but also change their brand-building strategies.

ADVERTISING IS NOT ENOUGH

Most users today log on for one of two reasons: To get practical information such as the product detail or to shop. A survey conducted on the Web last year that 80 percent of the people logging on for information to a site said they would like to buy the products in future. Thus web presence creates a virtual sales channel.

The need to sell in cyberspace has challenged many industries. Some manufacturers have no experience in selling directly to customers online but see one-on-one relationships as simply invaluable. High tech services companies can secure future sales by using online presence as means to communicate with customers. Firms can send targetted message to their customers online.

Just providing exhaustive information about their products can help future sales of capital goods.Xilinx, for example provides extensive information on its programmable chips on their website. This helps to win mindshare of potential customers and thus capture and engage a large audience.

WHAT THE CUSTOMER WANTS

To succeed, the top levels of a company must know what they have always needed to know: what their customers want from a Web site. Successful companies know this. One common theme among successful executives is a genuine interest in what happens in cyberspace. They go into their own sites, and competitors' sites, on a regular basis.

"Everyone at this company spends a lot of time on the Internet,"said Mr. Parker of CDnow. "We know what's out there. The Net is not a part-time job; it's not something you just dabble in."
Successful Internet managers are obsessed with streamlining the process. They know how many clicks it takes to get the required information, and how long it takes them to respond to e-mail. Companies have to optimize the number of clicks for customers to get where they want to be. For Example, CDnow ran a test that measured exactly how many clicks it took to get online consumers to purchase. The group then worked on consolidating steps to eliminate the unnecessary work and got from 20 clicks down to 10. That gave an immediate competitive advantage.

While it is not easy or cheap, Yet to build brands in cyberspace, companies will have to let go of some of the thinking that has been holding them back. Senior managers must embrace the medium with gusto. They must realize that interactivity on the Internet does not mean a fun game, but sell-through marketing. They must become closely involved in all aspects of the company's Web strategy.

Point and Click Your Way to Success

• The technology for building a Web site is the easy part; it's the strategy that makes many companies stumble. Here are a few guidelines for creating an effective Web presence.
  Make sure all senior managers are on board and intimately involved in the Internet strategy. The setup and running of the site may be centralized, or even outsourced, but executives should know exactly what the site is trying to do and how well it works from a practical standpoint. A site with glitches should not be allowed to launch, no matter how "cool"it is.
  
• Make technological improvements slowly. This may sound counter-intuitive, but many in the Web universe have older computer equipment and software and need ease of access more than they need bells and whistles.
  
• Guide customers to information quickly. Every extra click needed - and the concomitant delay - presents a chance of losing the customer.
  
• Leverage existing expenditures on brand-building as much as possible. A corporation's Web address should be listed on television commercials, stationery, shopping bags and receipts. Sales people should recommend the Web site to customers.

Fighting Commoditization of Brands

By Arun Kottolli

Introduction

We are living in a conusmer era. Companies, eager to sell their products to customer have created millions of brands. In consumer goods, there are more than 60,000 brands in India alone. In industrial goods, for every product, there are atleast 3-4 brand of products which offer similar functionality, look and feel. The commoditization of brands has made it increasingly difficult for the customer to perceive the differences between a certain brand and that of the competition. The study claimed that 86% of brands in multiple categories tended to have the same key attributes. In a recent article in the Harvard Business Review, Brand Confusion, Jack Trout and Kevin J. Clancy maintain that, brand indifferentiation is already a fact. What is interesting about this is that it measures the levels of similarity by sectors. In ASIC industry for example, the maximum level of similarity perceived between brands is between Open-SIlicon and eSilicon.

If we bear in mind that the main objective of any brand should be to differentiate itself at all costs, we can see the size the problem. The problem is so important that even the branding gurus are beginning to use the term superbrand or powerbrand to designate the strongest or those with a greater power of attraction than others. This is the proof and acceptance that there is a hierarchy within brands, what we could call a level of branding, that is to say brands within brands.

From Branding to Brand Management

As is well known, brands were originally created in order to be able to differentiate what we offer from what the competition offers. We "branded products" it to avoid confusion and help people to remember, identify the manufacturer and aid the choice of purchase. This progressively involved equipping the product offered with attributes which converted it into the favourite choice of the purchaser. We thus began to have companies which offered products and companies which offered brands or, in other words, products with an additional differentiation which made them more competitive. This process is just the starting point of what is now known as Branding.

The problem is that, like any strategy, sooner or later it is also discovered and used by our competitors, which leads us to the current situation: lots of brands, we could even say too many. Brands which are sometimes almost pointless, brands which, instead of helping the customer to choose, complicate the purchase enormously, brands which do not provide anything and which in the end are perceived as mere commodities.

Is this then the end of Branding? The answer is quite the opposite. It represents the sophistication of the discipline, the true birth of Brand Management. It is relatively easy to give our product a name, to get a spectacular logo designed for it and to devote ourselves to repeating (insistently) this brand in numerous exposures to the customer. It is something quite different to capture the essence of the product offered, to conscientiously create an attractive, different personality, full of meaning for our potential customer, and to connect it on an emotional level to our brand, providing it with a certain magic. This is indeed a much more complex process that is called brand strategy.

Brand Strategy involves giving the brand a very clear power of attraction, a set of relevant, unquestionable meanings which achieve a space not just in the head but also in the heart of our customers. A strong brand should fulfil three basic objectives:

1. Information
2. Differentiation
3. Seduction

Information because it should tell us something about the product offered that is intelligible and decipherable: "I have to understand the proposal of basic value or what the product offered consists of."

Differentiation because what it tells us should be perceived as different by the purchaser or, in other words: "I understand what you are telling me and I think that it is something that the others haven’ told me."

Seduction because this is the raison d’ of any brand. The first two are in the service of the third: in the end a brand has to tell us something that we consider to be interesting and that ends up seducing us. And seduction is something very subtle.

There are currently numerous brands in that have reached the first stage. They have succeeded in getting us to recognize their logos and we see their advertisements. They have succeeded in getting us to know more or less what they offer but they have not seduced us. They are there, in our mind, but when it comes to buying we do not feel that irresistible, emotional attraction that drives us to clearly opt for one of the participants.

We should not confuse Communication with brand creation or management. The objective of Communication may be to achieve renown for what we offer, but we have to define the brand, to know what to communicate, what to say in our communication plan. In short, what meanings, values and personalities are important and distinguishing. The objective of Brand Management is to maintain the consistency and strength of the brand so that it can be adequately exploited. This should be the work of a good brand manager.

Fighting indifference

It is possible that there is already an enormous group that has ceased to believe in the so-called traditional brands. The brands that have become stuck with classical management models of the characteristic-profit type. Or brands that talked to their consumers from a pedestal, with a certain arrogance. Or global brands which have lacked sensitivity to detect small local opportunities, emotional moments that can represent the difference that we are seeking.

We have, however, also been able to witness the appearance of new brands based on the management of experiences as a means of differentiation, with a clear definition of meanings and an excellent transmission of the same, full of creativity. New strategies that have managed to find a niche among the big supercompanies. An analysis of these new brand management models may give us clues as to what the new Brand Management will be like.

1. An emotional as well as a real offer

If we are going to work on the brand we can take it for granted that we have already worked on the product. Nothing can aspire to be a brand without first having managed to be a good product or service as a minimum prerequisite to compete. The first thing that can differentiate a seductive brand from its undifferentiated competitors is therefore how charged with emotion our product is. This does not refer to elaborate emotions such as falling in love with our brand of shampoo, but rather to pleasant sensations, desire, attraction, greed, a longing to buy it almost as an impulse without the need to rationalize it too much. If our brand is clearly differentiated, it will certainly have this emotional part that distinguishes it from the rest and obtains the sale, because it has been said that a brand is made up of a good basic product plus a good dose of magic.

Think of a Intel Pentium processors, Cell Phones from Nokia or Services from IBM.

2. A feeling of community

The true success of a brand does not consist in engraving a logo on a product but rather in giving rise to a certain similar experience for a group. The customer portfolio is the most valued asset of any company. The community of sympathizers with our brand is what we really manage to obtain this asset.

Harley Davidson is one of the few brands that have literally succeeded in tattooing themselves on the skin of their consumers. Its managers organize meetings, festivals and even rallies in which the Harley users share their experiences. This is not just a powerful Relational Marketing strategy, but also constitutes one of the main sources of information for the company. Apple is another brand that has known how to manage its community of followers and has used it to emerge from an important crisis.

3. The values within the consumer

We are increasingly well trained and informed in today’ world. And we are less and less willing to buy a symbol-brand which simply lists values to which we should aspire. In this new social setting we will not just increasingly opt for socially responsible companies, but also for products which have a positive effect on our environment and share our values and concerns.

Brands such as Google and its digital Library project, or how Star Bucks has capitalized on its "Fair Price for Farmers" campaign, are examples of how to achieve a direct and emotional connection with your consumer.

4. Our communication goes further
One of the phenomena that can be observed is the desire that some brands have to communicate like other brands. Think for a minute: our main objective when it comes to considering our communication should be to stand out and to seduce. On the other hand the first thing that we do is to try to adopt the code of the competition. We all feel more at ease without breaking the rules of the sector’ game, but only the brands that communicate in a different manner manage to impress, to go beyond the medium that we are using to position themselves in the minds and hearts of people. This is the exercise of every night on prime time, and the barrier that very few brands manage to pass.

When the code in vodka was to talk about its origin and elaboration, Absolut focused on the appearance of the bottle. When the code in aviation was to show smiling air hostesses and passengers wearing ties, Iberia surprised us with babies. When Telefónica Móviles was talking about technical characteristics and price, Amena presented young people dancing.

5. The obsession with small details

Another characteristic of new brands is their obsession with detail. An insignificant detail can have a tremendous impact on the perception of our product. These are details that sometimes communicate much more than big campaigns: an original sachet of sugar with the coffee, a small bag for the sales receipt, a small sweet, a smile, a certain smell on entering a shop, a pleasant tune, numerous small details that denote a big difference.

There are brands that think in terms of massive strategies and handle gigantic resources and brands that communicate ‘ not concerned about costs, I’ concerned about your satisfaction’ and recognize the impact of small details, those that often generate word-of-mouth, surprise, a smile. Those that succeed in positioning the brand in our list of preferences.

We therefore believe that the model of shouting from a pedestal in just one direction is coming to an end. The brands that are appreciated listen to the consumer, to the customer, to the guest experience as some even call it. Communication should become a dialogue and there are new supports, media and technology that transfer part of the power to the consumer in order to let them give their opinion, make a counter-offer, propose... even to make a harsh judgement on the decisions of the big brands.

Before communicating and transmitting, however, we need to define. Three very important elements make up the product we offer: what it is, what it does and what it means. If we cannot complete and define each of these dimensions we do not have a strong brand. All products talk about what they are, and nowadays we are rarely differentiated by what we do. To think in terms of brand management is to consider the creation of meanings.

Therefore Actimel does not sell fermented milk but the ability to strengthen your defences against external aggressions, a VW Beetle is much more than a compact car, a Palm is almost like a Game Boy for adults, a Hallmark card is the possibility to communicate a feeling, Evian is the purest, most crystal-clear water in the world, Disney sells you eternal youth, and a BMW is for those who know how to appreciate the subtle difference between driving and ‘driving a BMW’

Tell us how much magic your product communicates and customers will tell you whether you have a powerful brand.

Flower-1 

Successful Online Branding

Successful Online Branding

By Arun Kottolli

Introduction

To promote their brands, advertisers can choose between a huge number of different media channels, including newspaper and magazine advertisements, direct mail, and television and radio advertisements. Some years ago, the introduction of the Internet promised the beginning of a new branding area:. Suddenly many companies spent huge amounts of money on the modern media channel, however, often failing in turning their online branding efforts into success. Consequently, the Internet was disdained and regarded as risky choice to promote a brand. However, with the further growing presence of the Internet, marketers show the tendency to give the modern media channel a second chance.

The question is if it still makes sense to use the Internet as an alternative to traditional channels with all the failures already in place. Is it possible to successfully promote a company’s brand in the online space at all?

The Internet as Differentiating Factor

In advertising, differentiation became a golden rule to gain an advantage in the growing competition for consumers’ attention on and preference for a company’s brand. Offering a variety of different features (e.g. online account servicing, interest based attractions designed for children) and a huge potential of creativity, the Internet inspired marketers to use it as new branding and advertising tool. Though some companies at first questioned the relevance of brands in cyberspace, advertisers were soon taught that the need for brands can be even higher in the online medium than it is in traditional channels. Being confronted by similar products from many often unknown providers, consumers rely on the strength of brands which possess a meaningful, clear and trusted set of values and attributes, facilitating their online purchase choices.

Deriving from its unique characteristics, the Internet provides several key advantages. First of all, advertisers can utilize its interactive nature to build top-of-mind awareness among customers. Computer maker Sun, for example, utilizes the business websites to communicate with corporate buyers.

The Internet furthermore possesses the feature of relevance in so far that it is more efficient than other channels in reaching people that are part of a market of specific interest like computers for business needs.

Websites are able to combine sponsorships with editorial, making use of their relationships to users to link their needs with the branding goals of advertisers. The Internet can also be used to increase brand awareness all over the world.

Marketers soon were convinced by the Internet’s huge potential for success. End of 1998, consumers’ e-commerce attitudes forecasted a tripling of e-commerce activity for the up-coming year. The online medium was thought of as a simple way to create a differentiated image with little efforts to develop a variety of online resources. However, only several months later the problems of many advertising companies to succeed in cyberspace proved the opposite. The following paragraph will explore the reasons for the online failures, and thus will address the question if the Internet should be blamed for this negative result.

Don’t Forget about the Basics

Online companies in specific, a huge number of advertisers provided ‘marketing plans that assumed brand loyalty could be built in a quarter’. More problematic, advertising companies merely concentrating on capturing online users and their dollars, were ‘overlooking the simplest marketing remedies’, disavowing years of consumer and advertising research. A lot of money was spent on Internet marketing initiatives however missing any specific target.
Though there were reasons to question the old rules – with the Internet offering new
business models and media options – it was soon realized that only those firms which
practice tried and true marketing and branding practices will prosper.

Advertisers should not forget about the basics of marketing, since they retain much of its value, ‘even if how and where we apply it has radically changed’. Besides considering general issues in branding, including the competitive advantage of strong brands, and the role of the consumer.

It is recommended that advertisers to pursue the following steps to successfully promote their products online:

1. Development of a clear vision
2. Extensive research on consumers
3. Formulation of an attractive value proposition
4. An appropriate communication campaign to retain previous customers and acquire new ones.

Beyond advertisers’ disregard of basic marketing principles, many companies’ internal organizational structure lacks to properly address online objectives. With branding constituting a complex process involving a number of different organizational parties – ‘from the top of the corporate structure to the individuals that are actually interacting with customers’ – the question remains who actually is responsible for the online activity of a company.

The management of e-businesses is in general shared by three departments: information
technology, marketing, and communications. However, getting organized remains a
major problem, with companies struggling with the common organizational phenomenon
Of "everyone being in charge and no one being in charge". Resulting from the lack of consensus are diverse problems – ranging from slowness in exploiting the online medium, due to endless debates over the most appropriate e-branding business model, to companies confusing users with hundreds of websites – that are severely affecting the future of a company’s e-business. Being confronted with an impatient online community, firms are advised to concentrate their efforts on an appropriate organizational structure, if they plan to survive in cyberspace.

Another problem is a severe disconnect between how customers find new web sites and where companies are focusing their branding investments. Though consumers’ top choices in discovering new websites are represented by search engines and recommendations from friends, marketers were observed to spent most of their budget on banner ads, newspaper, television and radio. In addition, many firms neglect to use powerful mechanisms, like sponsorships on other sites, in spite of their ability to reach a considerate number of users.

Summarizing above findings, advertisers are facing serious problems in cyberspace.

The next paragraph addresses these difficulties by presenting and explaining the most important principles companies have to take into consideration to successfully brand online.

Driving Online Branding to Success

Branding, constituting one specific part of e-marketing, can be understood as the inspiration of people "to think or feel a certain way about a product in the hopes of inducing or increasing product purchase and loyalty".

In cyberspace, marketers face new and different challenges and opportunities. However, the rules of the Old World are still true and should not be neglected. Spending a lot of money alone is no guarantee for success. Rather, the development of a powerful brand requires money, analysis, planning, execution, and time.

The following key branding principles show brand managers how to build a robust brand on the Internet and thus how to be successful in the online branding business:

• Defining the Brand
• Selecting the Brand Strategy Framework
• Developing Specific and Achievable Goals
• Operationalizing the Brand
• Leveraging the Features of the Internet
• Monitoring the Brand’ Performance
• Caring for Your Customer

Defining the brand: The first crucial step to successful e-marketing is investing time and energy in gaining a thorough understanding of your brand, involving its meanings to potential consumers, its relationship to competitors’ brands, and the brand’s role in the market. Marketers need to bring these key branding elements with them when they enter the online space.

Selecting the brand strategy framework: Depending on a company’s products, brand
managers can choose between three basic frameworks:

• Conglomerate brand strategy – the company’s brands stand on their own, e.g. Procter &
  Gamble with independent brands like Crest and Tide
• Corporate brand strategy – a more dependent relationship between the company and its brands, e.g. brand IBM and its various divisions like IBM's MQ series, DB2, and Z-Series.
• Master brand strategy – very close relationship as every brand name includes the corporate brand name, e.g. Intel Pentium, & Intel Centrino.

Developing specific and achievable goals: Different objectives demand different
strategic approaches. It is therefore recommended to distinguish between specific branding goals, for example:

• Awareness – effective online and offline advertising and public relations are required to distinguish a company’s brand from the crowd
• Message association – to get customers to associate a company’s message with its products, marketers have to guarantee high frequencies of simple, uncluttered ad units or sponsorships of content tied to a brand's message

Leveraging the features of the Internet: Branding in cyberspace offers advertisers
unique opportunities allowing them to strengthen brand affinity. However, the diverse
Web programs and tools have to be fully understood and used in consistency with the
company’s branding strategy to guarantee a successful branding result. The following features are most important for online branding success:

• Search engines
• Permission email
• Personalization
• Word of mouth
• Affiliate networks

Monitoring the brand’s performance: With brands showing a dynamic nature, their online performance needs to be monitored and measured on a regularly basis. This process reveals whether a brand remains of relevance for the customer and informs marketers in time if steps have to be taken to improve the brand’s performance. The monitoring part of the branding process should not be neglected since it is important to track progress, so you can justify efforts and expenses for future branding actions.

Caring for your customer: A key component of any brand experience is the quality of customer service and support. A sound understanding of the company’s customers is a critical prerequisite in achieving such service excellence.

It becomes a necessity to increase the frequency of communication with online users by
establishing dialogue systems like focus groups and quantitative studies. In addition, the online experience should be easy and logical in order to delight users and encourage repeat site visits. Therefore, good website usability is a key to satisfy online customers. Comparing established brands with pure players, furthermore found that the online experience is of higher importance for a mature brand. Consumers expect according experiences – often making no distinction between the brand in cyberspace and in the real world.

Though confronted by a rapid changing technology, marketers can face the challenges of the online world by pursuing the above key branding principles. Branding on the Web, they will gain a deeper understanding of the diverse unique opportunities of this modern media channel. Online advocates, for example, suggest specific solutions that will help companies to further distinguish them from their competitors.

Conclusion

In recent years, many companies failed to use the Web as a new and different media channel, often resulting in their online extinction. Should the Internet be blamed for these catastrophes?
The possible reasons for online failures are usually: ‘neglect of basic marketing rules’, ‘internal organizational structure’, and ‘disconnect between consumer behavior and branding investment’ – demonstrating that the negative consequences were not caused by the Internet, but rather by some marketers’ inappropriate behavior. To successfully use the Internet for their branding purposes, key principles must be followed and that should prevent failures on the Web and ultimately lead to online marketing success.