Challenges to the brand and public relations in the age of e-commerce

Please note this material was written for another programme. It refers to the course, elements etc which you will not know about. Take the content from this and use for your studies.

E-Delivery and the brand, element on challenges to the brand

Contents
1 Introduction................................................................................................................... 4 2 Commercial challenges................................................................................................ 5 2.1 Deregulation and open systems..................................................................................5 Self-assessment question.............................................................................................5 2.2 Commoditisation..........................................................................................................6 2.2.1 Commoditisation in B2C........................................................................................6 Self-assessment question.............................................................................................6 Self-assessment question.............................................................................................7 2.2.2 Commoditisation in B2B........................................................................................7 2.2.3 Responses to commodotisation in B2B................................................................7 Self-assessment question.............................................................................................8 2.2.4 Responses to commoditisation in B2C.................................................................8 3 Research on the impact of brands in B2C e-commerce...........................................10 4 Public relations...........................................................................................................11 Self-assessment question...........................................................................................11 5 Attacks on the brand................................................................................................... 12 5.1 Cybersquatting...........................................................................................................12 5.2 Typosquatting............................................................................................................12 Self-assessment question...........................................................................................12 5.3 Banner advertising.....................................................................................................13 5.4 Links and framing.......................................................................................................13 5.5 Negative sites ...........................................................................................................13 5.5.1 Protest and parody sites.....................................................................................13 5.5.2 Search engines and protest and parody sites....................................................14 Self-assessment question...........................................................................................14 5.5.3 Traffic diversion schemes...................................................................................14 5.6 Rumours and abuse of emails...................................................................................15 5.6.1 Rumours affecting share prices..........................................................................15 5.6.2 Malicious gossip..................................................................................................15 5.6.3 Commercial threats.............................................................................................15 5.6.4 Counterfeit goods................................................................................................17 5.6.5 Grey markets.......................................................................................................17 6 Brand protection......................................................................................................... 18 6.1 Monitoring the Internet...............................................................................................18 6.2 Scanning the environment.........................................................................................18 6.3 Name audit.................................................................................................................18 6.4 Purchase of the site...................................................................................................18 6.5 Close the site down....................................................................................................19 6.6 Action with search engines........................................................................................19 7 Communicating the brand.......................................................................................... 19 Self-assessment question...........................................................................................20 8 Advertising.................................................................................................................. 21 8.1 Internet advertising....................................................................................................21 8.1.1 Forms of Web advertising...................................................................................21 Self-assessment question...........................................................................................22 9 Interactive marketing and the brand.......................................................................... 23 9.1 Personalisation and the brand...................................................................................23
E-Delivery and the brand, element on challenges to the brand

9.2 Interaction and community ........................................................................................23 Self-assessment question...........................................................................................23 Self-assessment question...........................................................................................24 10 Bibliography.............................................................................................................. 25

E-Delivery and the brand, element on challenges to the brand

1 Introduction
As we have noted through the whole course, brands have been seen as a vital source of competitive advantage, especially with the lower entry barriers we have see through the advent of e-commerce, globalisation and deregulation (Kotler, 1999). Brands are an assurance of trust, quality, consistency and reliability (Birch, Gerbert and Schneider, 2000). This is seen as particularly Important in a virtual world with fears of security and crime and no direct contact between buyer and seller. Brands have faced a number of challenges with the advent of e-commerce: these can be divided into commercial challenges and public relations and attacks on the brand. On the commercial side brands have faced an increased risk through lower search costs and the moves towards commodotisation. The new medium also changes the traditional style of message given to consumers from a standard mass message to a more personalized one; on the Internet brands increasingly mean different things to different people (De Chernatony, 2000). Consumers also have far more influence over the messages they see, through for example, the ability to skip adverts through the use of emerging technologies such as interactive TV and personal video recorders (PVRs) Attacks on the brand are concerned with the use of Internet technologies to discredit brands, or to gain commercially by passing off as them. These attacks can come in a number of forms including protest or parody websites, predatory registration of domain names and the sale of counterfeit goods.

This element will look at these challenges, taking examples from a range of sectors and see how organisations have attempted to meet them.

E-Delivery and the brand, element on challenges to the brand

2 Commercial challenges
2.1 Deregulation and open systems
The following diagram, adapted from Dussart (2001), shows a model to analyse the impact of e-commerce, in providing easy access to services from many providers - both in terms of purchase (open finance such as the Bradford and Bingley marketplace) and then in terms of use (e.g. ATMs) - on brand loyalty (One could argue that brand loyalty here is being confused with indifference and customer apathy). However, the move towards open access has implications, as for example, a communications campaign which relies on the use of ATM machines as a major tool to reach customers may only reach a percentage of the target population as cash access is not tied to the use of a particular banks ATMs. A similar issue faces television providers with the advent of 3G as their content starts to become available over telecommunications networks. In the early years of the new millennium, however, the shift to more open systems in many areas, for example, the emergence of financial portals and marketplaces have had limited impact.

Degree

Absolute brand loyalty

Proprietary business system

Fully open business system

Figure 1: Brands and open/proprietary systems Source: Adapted from Dussart 2001 Self-assessment question Develop the above diagram adding examples of specific technologies on the spectrum from proprietary to open system.

E-Delivery and the brand, element on challenges to the brand

2.2 Commoditisation
2.2.1 Commoditisation in B2C In the early days of e-commerce it was believed that brands would not play an important part in consumer decision making. To quote Kalakota and Whinston (1996, p508) Few consumers seem to demonstrate lack of brand loyalty quite like those on-line Building on this line of argument other writers have talked about the impact of ecommerce in reducing the value of brands and the process of commoditisation (PriceWaterhouseCoopers, Ronson 2000, Sinha 2001, Simon 2001). This has been seen as a general threat of e-commerce with the improved ability of buyers to shop around through comparison shopping tools, the growth of auctions and the wealth of information that is available. Hagel and Singer (1999) argue that brands historically were a proxy for imperfect information and consequently as this constraint is reduced brands will suffer. In the words of Sinha (2000, page 47) Internet technology erodes the "risk premium" that [branded] sellers have been able to exact from wary buyers Self-assessment question Evaluate the risk premium argument. Has this gone down through e-commerce? Another problem cost transparency gives according to Sinha (2000) is distrust of companies. Consumers become more aware of what profits are being made and the improved communication of the Internet makes other less assertive consumers aware of this too. A relevant example are the sites in the US, such as http://www.edmunds.com, which list the cost of cars to dealers and the best prices consumers have got. This reduces the information asymmetry which has existed. A possible example here in financial services is mortgage provision in the UK where the use of tiered interest rates has given bad publicity to certain providers. A further threat to brands is the supposedly more rational nature of the Internet consumer (Sinha, 2000, page 49). To quote Sinha The Internet encourages highly rational shopping. Before the rise of e-commerce, most companies attempted to build their brands by using sensory cues that required "affective processing," or the words, images, sounds, and smells that speak to people's emotions. .The Internet, however, presents a very different shopping experience, one that appeals to people's cognitive faculties. It encourages dispassionate comparisons of prices and features. It also puts shoppers in control-it's up to them to consciously navigate through the Net's maze of pages and links. And although surfers' increasing use of multimedia will give companies new opportunities to provide sensory cues on-line, the

E-Delivery and the brand, element on challenges to the brand

solitary, information-rich nature of Web shopping will continue to encourage people to make decisions based on reason rather than emotion. For a discussion of commoditisation in Financial services see http://www.pwcglobal.com/extweb/pwcpublications.nsf/4bd5f76b48e282738525662b0073 9e22/3492ae16f152dc7a8525691f004cdc05/$FILE/Implications+for+F_S_Pv.3.pdf Self-assessment question (i) Has commoditisation impacted on your industry? (ii) If so, which particular products have suffered most? (iii) Do you agree with Sinhas argument regarding web shopping and shopping in the physical world? 2.2.2 Commoditisation in B2B Commoditisation has impacted on B2B in a more pronounced manner as suppliers have been forced into industry exchanges. This has occurred in the same way large organisations historically forced smaller organisations into joining proprietary electronic data interchange (EDI) systems. With EDI the benefits were lock-in as the smaller organisations could not afford the technology costs of switching to another system, however, with exchanges the benefits are increased competition through a wider supply base and the associated reduced costs of procurement. A further benefit (for buyers) of the buyer controlled exchanges such as Covisint is reduced information asymmentry for the buyers. Since the 1970s auto makers have not made many of the components for cars and hence do not know the precise cost of production. As they control the exchange the improved information on prices they will obtain will increase their bargaining power. This along with the buyer power they have makes it likely that Covisint will be spun off as a separate entity as regulation and competition bodies look into it. 2.2.3 Responses to commodotisation in B2B 2.2.3.1 B2B: Exchanges A KPMG survey of the chemical industry found that providing value-adding products and services to prevent commoditisation is a very important objective for 75% of respondents. (KPMG, 2000, page 4) This is a particular threat in the chemical industry as it is a mature and heavily concentrated industry with large buyers. As there is also over capacity so industry rivalry, in Porters model, is strong with firms eager to reduce supplier costs. Thus players in the chemicals industry, such as Ciba Speciality Chemicals, Cibasc.com have moved to promote themselves as solutions providers in an attempt to ward off commoditisation. The successful development of IBM as a services provider gives a possible model here, as the mainframe business on which they built their name has long been commodotised. Exchanges also illustrate the power of relative supplier-buyer relationships at different levels of the supply chain. In the role of supplier an organisation may fight the introduction
E-Delivery and the brand, element on challenges to the brand

of exchanges whilst when the same firm is a powerful buyer they are instructing their suppliers to move this way. 2.2.3.2 Developments in exchanges An interesting development away from commodotisation in B2B is shown by the website perfect.com. They are attempting to overcome problems regarding non price factors in B2B markets with their request for quote process. It has developed a technology which allows buyers to state what their requirements are in a number of attributes as well as price, for example, quantity, product features, material quality, merchant quality, time-todelivery and warranty terms. Suppliers then state their abilities in these attributes and the software then finds the best match. Self-assessment question (i) How could exchanges reduce the threat of commoditisation? 2.2.4 Responses to commoditisation in B2C 2.2.4.1 Blocking out comparison shoppers This has been used by organisations, though it can send out the wrong message to consumers. De Chernatony (2001) also writes that in 2000, Abbey National, blocked some comparison websites from using its mortgage details. Another approach which has been used is that of maintaining a more complex array of prices, made possible through the lower menu costs (i.e. the costs of changing prices) of e-commerce. This is something that has long been used in the air travel business. Perhaps, there is a concept of a fair deal here as the level of protests over air travel price discrimination are far lower than in tiered mortgage prices, though of course, mortgages involve far more money and are long term commitments. 2.2.4.2 The experience economy A further attempt to ward off price competition has been the development of products as experiences. The paper by Pine and Gilmore (1998), Welcome to the Experience Economy, Harvard Business Review argues that organisations should change consumers experience of the brand as with cheaper technology it is increasingly difficult to distinguish through quality or price. Pines argument is depicted in the below diagram which shows that economies have evolved from the provision of basic commodities to the provision of services.

E-Delivery and the brand, element on challenges to the brand

Figure 2: The experience economy Source: B. J. Pine and Gilmore J.H. (1998), Welcome to the Experience Economy , Harvard Business Review, July-August 1998, Vol 76. No. 4, page 2 Pine and Gilmore argue differentiation now comes through experience, which should be memorable and something people value. Pine and Gilmore give the example of people sampling music in a store or arranging special events for consumers. Furthermore, these experiences should be worth paying for. A practical example is the way traditional booksellers have tried to use experience features against the threat of cut-price etailers. When Waterstones opened their flagship store in Piccadilly in 1999 it included tables and a caf where books could be read to encourage browsing. This could be seen as an attempt to rival the community feel of the likes of Amazon, which again could be seen as an experience effect. Whilst this may be the case it is highly unlikely that anyone would pay for the privilege of using these facilities. The experience economy to the degree of charging for experiences may have relevance for luxury stores such as Harrods, but for the vast majority of the economy it can be seen as an aspect of marketing which can be applied to an extent alongside other initiatives.

E-Delivery and the brand, element on challenges to the brand

3 Research on the impact of brands in B2C e-commerce

Some research on on-line shoppers have shown they are attracted to brands, e.g., a comparative study of Tescos store and on-line transactions showed "Best selling brands sell more, smaller brands sell less," see this at http://www.eccs.uk.com/suppliers/newsanalysis/may2001_2.asp This has implications for the e-commerce strategy of retailers as own brand labels market share has increased consistently over the last decade (Quelch and Harding, 1996). This suggests that the risk premium, search costs and perhaps the characteristics of these shoppers outweigh any brand erosion effects. Research done by Sinha also shows the relative importance of brands on-line to off-line to consumers. The following graph available at http://www.sbm.temple.edu/ebi/workingpapers/EBI 3.pdf illustrates this.

Figure 3: Relative importance of brands on-line and off-line Source: Sinha, http://www.sbm.temple.edu/ebi/workingpapers/EBI 3.pdf On the decline of brands other research (Jupiter MMXI cited by Yahoo 2002) has shown brand loyalty can be harder to keep and is less important to online shoppers. To keep a balanced outlook deep analysis would also need to be developed looking at product category, price and the characteristics of the buyer.

E-Delivery and the brand, element on challenges to the brand

4 Public relations
Public relations involves communicating with the target population using methods apart from advertising. In this section we shall look at commercial issues, then later on in the element at brand protection issues. Public relations can include: Publicity: A major role of PR is ensuring the company is in the spotlight with news, magazine features etc. o B2C example: Ernst Malmsten and Kajsa Leander the founders of Boo, for example, obtained front page coverage on Fortune magazine before the launch of their companys website (Laudon and Laudon, 2002, p135).Coverage in major media centres is thus vital. o B2B example: TDI, a US PR firm, held a publicity event at a New York train station on behalf of their clients Teligent to reach their core market, financial institutions (Freeman, 1998) Another example of publicity would be reacting to adverse events, such as the handling of poor website performance, e.g. the launch of the British Midland website for discount fairs, Amazons admission that it had varied prices or its labour problems or security problems with financial websites. For an example of problems aired in the media see the article Amazon's Wish: No More Bad PR at http://www.thestandard.com/article/0,1902,20598,00.html. Events: Examples of these would be grand openings or press conferences. There is the extreme example of a town, Halfway in Oregen USA with 345 people, being renamed Half for a year in January 2000 after half.com, the etailer which is now owned by Ebay. The company got publicity for the launch of its website through media coverage and in return the town received economic development funds and free computers (Laudon and Traver (2002). Obviously this is a rare example and there is a limit to the use of such an approach. Publications: This refers to company publications which are distributed to the target population. Media centres: Some firms have proactively managed PR through their websites such as Ford with their media centre. However, there is the issue of eyeballs here as how can smaller firms take advantage of this medium as they do not have the same number of hits. Self-assessment question Identify examples of the above forms of public relations.

E-Delivery and the brand, element on challenges to the brand

5 Attacks on the brand

"Bad press, scurrilous rumors, and outright lies have always been a fact of life for corporate-image watchers, but the Internet makes it possible to distribute that grief more quickly and widely than ever before. From the standpoint of any company concerned about its online reputation, the Web is a monitoring nightmare." (Source: http://www.cyberalert.com/whitepaper.html) In this section we will shall look at some of the attacks on the brand we have seen through e-commerce.

5.1 Cybersquatting
This occurs when someone registers your name as a domain either for financial gain, or to influence your customers. Marksandspencers.com, BT.com, Virgin.com, Ladbrokes.com and Sainsburys.com for example, were registered by a company called One in a Million and offered for sale. This site had to hand the names over after a court ruling.

5.2 Typosquatting
This is when a domain is registered which is very close to that of an organisation, for example: http://wwwhotmail.com which takes you, April 2002, to a US site offering financial services. Likewise http://wwwegg.co.uk/ takes you to the site, http://www.geenie.co.uk/ which offers financial services. Self-assessment question (i) Try combinations of typosquatting for sites you are familiar with. How many examples of typosquatting do you come across? (ii) What precautions can you take against typosquatting?

E-Delivery and the brand, element on challenges to the brand

5.3 Banner advertising

This refers to the use of reactive banner advertising. Another organisation may pay a search engine to display a banner ad when a search for the name of another company is used, for example, if a search is done for Dell the banner of another computer seller is displayed.

5.4 Links and framing

One of the core features of the Web is the ability to link to other sites. This core feature of the web, however, can have problems as unauthorised links may be made to your site. People may think this gives some form of company authorization to the site. A further problem is the use of frames, which is a design feature which allows the web page to be divided into two or more sections (webopedia.com). This has caused problems when a frame is used to display information from another site. An example of this was the dispute in 1998 between the Shetland News and the Shetland Times: the Shetland News used frames to display news stories from its rival without permission or acknowledgement. The equivalent of an injunction was granted and the case was eventually settled with the News agreeing to acknowledge stories used and include a link back to the Times site (Rennie, 1999).

5.5 Negative sites

5.5.1 Protest and parody sites We have seen the emergence of many sites which have negative opinions about organisations. These can come from angry consumers, disaffected employees, past or present or malicious Internet users. For example, British Telecom, Nike and Virgin Atlantic have all suffered in this way. Examples are: http://www.starbucked.com/ http://www.monopolists.com/ http://www.saigon.com/~nike/ http://www.virginaircrewlies.com/original/florida5.htm http://www.watsonville.com/dakota/ http://www.cokespotlight.org/flash/indexflash.html http://www.untied.com/ http://www.stopesso.com/ http://www.chasebanksucks.com (this site could offend) These sites disseminate negative views on these organisations and some are linked with the more general No Logo movement, information on this can be found at http://www.nologo.org/. This movement was inspired by the work of Naomi Klein who argues that brands

E-Delivery and the brand, element on challenges to the brand

represent a fascist state which stifles criticism, curtails choice and spreads poverty in the developing world by defeating local alternatives and the setting up of production in these countries (nologo.org). The parody of sites is when a site builds a mock up version of your site attacking your corporate values. A good example of this is http://www.monsantosucks.com/. The Cokespotlight site, http://www.cokespotlight.org/flash/indexflash.html, could also be seen as falling in this category. 5.5.2 Search engines and protest and parody sites What makes this a more acute problem for organisations is the role of search engines in spreading knowledge of these sites. A search done when this element was being written on Nike gave 4 negatives sites out of 20, the one listed above, http://www.saigon.com/~nike/, was number 4 in the results. One on Virgin Atlantic gave the above site, http://www.virginaircrewlies.com/original/florida5.htm, as number 2 in the results. A current consumer could thus easily come across these sites. However, a survey by Merks and Clerk found that only 31% of UK firms monitor online threats to their business (http://www.merks-clerk.com/). There is a list of consumer opinion sites, which attack brands on a Yahoo directory at http://dir.yahoo.com/Society_and_Culture/Issues_and_Causes/Consumer_Advocacy_and _Information/Consumer_Opinion/Individual_Companies/, which includes some well known UK financial services brands and a site http://www.companyethics.com/, which includes sites which include sucks in their title. However, the limit to their effectiveness can be questioned. Firstly they tend to be anti-capitalism/globalisation per se Second how much notice is taken of these sites? This is one to ponder as little research, if any, has been done in this area. A good source of information in this area which has been drawn on here is the white paper at http://www.cyberalert.com/whitepaper.html Self-assessment question Search using famous brand names which are often the subject of controversy. What results do you come up with? 5.5.3 Traffic diversion schemes This occurs when people purport to be the website of another organisation. The bogus site is indexed using to attract those looking for the official site and so users can get diverted to the bogus site. As Carney writes (2000) Federal authorities were stunned at the audacity of a Web page-jacking exposed last August that diverted requests for more than 25 million legitimate Web pages to a series of pornography sites managed out of Australia. The crooks made copies of the pages by
E-Delivery and the brand, element on challenges to the brand

coding them with instructions used by search engines such as Yahoo! Inc. and Lycos Inc. When Web surfers requested those pages, they were instead treated to dirty pictures. Angel Munoz, who owns popular teen computer-game site Avault.com, lost untold customers. ''There's an intangible harm done here,'' frets Munoz. The page-jacking scam has been shut down, but no criminal charges have been brought. This article is at Business week at http://www.businessweek.com/2000/00_14/b3675038.htm.

5.6 Rumours and abuse of emails

5.6.1 Rumours affecting share prices This is not strictly a threat to the brand, however, for completeness we will briefly mention it. At the height of the dot com boom with the massive growth in the number of private investors bulletin boards on popular financial sites were full of information on future likely trends or privileged knowledge someone claimed they had. However, in cases this was used to inflate stock enabling those spreading the rumours to make financial gain, a practice known as pumping and dumping. This has also occurred through the use of email, see http://www.businessweek.com/2000/00_14/b3675038.htm for an example. 5.6.2 Malicious gossip In 2000 Red Bull were the subject of a malicious email sent to customers which claimed that the drink had serious side effects, citing research published in the British Medical Journal, which was fabricated. The company received emails from anxious customers and had to issue a communiqu to refute the claims. KFC are another example of a firm who have suffered in this way. Emails alleged that they bred chickens with no beaks, feet feathers or bones. (http://www.marketinglaw.co.uk/open.asp?A=224).

These types of attack can be seen to be effective as they play on societys fears about food and health. 5.6.3 Commercial threats Outsourcing Outsourcing, as we saw in the module Structure and Organisation of E-Commerce plays an increasingly important role. However, there are risks to the brand especially if functions such as customer service are outsourced. This is particularly important as customers often have a direct interaction with those carrying out this work, for example, customer service or delivery staff. With products which are heavily commoditised such as books and CDs one could argue that in-house provision of these customer facing services is vital to maintaining the brand.

E-Delivery and the brand, element on challenges to the brand

Brand stretching It is normal for organisations to exploit economies of scope by expanding their product ranges. The costs of building the brand, as well as other costs such as technology, can be leveraged across new product areas. Amazon offer an example as they moved from their original book selling into other areas such as electronics. The threat which is posed here is that they may be unable to offer the same level of customer service and the overall brand may diminish. Jurkowich and Abrahams (2000) give an example of banks moving into insurance where poor claims processing could impact on the perception of the core banking part of the business. A further example of this would be Virgin which, after its successful forays into airlines and financial services, ran into problems with its venture as a rail company. Brand alliances Brand alliances occur when an organisation partners with another firm. The risks here are that the brand partner is unable or unwilling to offer the required level of service. Challenges of the multi-channel environment Organisations may operate through a number if channels and the issue here is that the customer experience does not damage the overall view from the customer perspective. For a paper on this see http://www.digitrends.net/ebiz/13643_15764.html.

E-Delivery and the brand, element on challenges to the brand

5.6.4 Counterfeit goods This has long been an issue for organisations in the protection of their brands. Anyone who has visited the Canary Islands or Hong Kong, for example, will have had the opportunity to buy fake merchandise. This counterfeiting has two negative impacts on organisations (i) Reduced revenues. Which products would you see this as a particular problem for? (ii) The inferior quality of the counterfeit products can undermine confidence in the brand. (Dibb, Simkin, Pride and Ferrell, 2000) These negative impacts can be questioned, however, as how many people who buy a Rolex believe it is anything but a fake? However, there is still a wider impact as the snob element of demand for these products is diminished as more people own what appears to be the product. For products which do not have any snob value, such as software, this does indeed represent a serious problem. The Internet has seen counterfeiting expand as the anonymity of the medium offers new opportunities for criminals. Microsoft estimate that 90% of software available for sale on auction sites is illegal (http://www.microsoft.com/presspass/features/2000/nov00/11-21safeshop.asp). Illegal software may also contain viruses and, of course, no support is available. For information on counterfeiting see the international anti-counterfeiting coalition at http://www.iacc.org/ 5.6.5 Grey markets The practice of grey markets is something which also has new opportunities through ecommerce. This occurs when branded products are sold without the consent of the brand owner, for example, retailers purchasing sunglasses through overseas distributers for sale in the UK. The opportunities through e-commerce are for contract manufacturers to sell excess stock through another site. For an example of grey activities, see the following link, http://www.webportal.com.my/search/cgi-bin/frames.pl?id=140&title=, accessed April 2002.

E-Delivery and the brand, element on challenges to the brand

6 Brand protection
6.1 Monitoring the Internet
The last section has outlined threats to the brand. This section will look at what can be done, excluding the legal issues.

6.2 Scanning the environment

Organisations such as Envisional.com and Netsearchers.com offer services to monitor misuse of brands on the web and check the results of search engines. These services can be divided into: Technical: This involves the use of software to perform trawls of sites after criteria have been drawn up, for example, key words or associations of the organisation and its products. For a free trademark search see http://www.nameprotect.com/cgibin/FREESearch/search.cgi. Manual: Automated solutions are generally not enough. Traditionally organisations would scan newspapers, sources of news and so on (http://www.cyberalert.com/whitepaper.html). Now this search has also to be done in a far wider sense. Scanning the environment using search engines also presents technical challenges. There are problems with search engines in picking up offending graphics and the offending site may not be picked up with search engines, for example, if it does not use relevant meta tags. However, the positive side of this is that less people will find them through search engines.

6.3 Name audit

It is important when considering this problem to think ahead and register common misspellings, e.g. visit http://www.yahop.com/, http://wwwyahoo.com/ to cover future possibilities. Finally there are the difficulties of international law where a trademark you have registered is owned in that country by another firm

6.4 Purchase of the site

Often a quick and easy solution is to buy the domain name. A good example of this is the DunkinDonuts.org website which originally was set up by an aggrieved customer. Dunkin donuts tried to get the site closed down and failed. The owner of the site published the threats on the site which led to further bad publicity. Eventually they purchased it and it runs as a copy of the main .com site. See http://www.cyberalert.com/whitepaper.html for information on this.

E-Delivery and the brand, element on challenges to the brand

6.5 Close the site down

Examples where this have occurred include amazom.com, which was a case of another bookseller typosquatting the Amazon name and marksandspencer.com where a fine was levied on the cybersquatter and the domain name handed over.

6.6 Action with search engines

A recent example of action through search engines is where anti Scientology sites were removed from the Google service after complaints. See http://www.searchenginewatch.com/sereport/02/04-dmca.html for information on this.

7 Communicating the brand

The perennial questions which has faced organisations is how to reach the target market. In practical terms this translates to where do you spend your money. Before we look at ecommerce it is worth considering how much more complex this has become as historically, this was a much easier task as the media was heavily concentrated. To quote McCorkell (1997, page 35) In the UK before the advent of commercial television it was possible to reach more than half of the adult population by placing one advertisement in the News of the World and another in the Radio Times. The former peaked at a circulation of just under 8 million and the latter at just over 8 million. By the time ITV offered national coverage, it was possible to reach half the adult population with one commercial This age represented the golden age for UK marketing departments as it was extremely cheap to reach their customers. However, this has since been an increasingly arduous and expensive task to undertake with the fragmentation of the media we have seen since the 1960s. Moreover, the proliferation of products available has made this a much more complex task as organisations have wanted to promote a number of messages to their customer base. The consumer has also changed as society has become more diverse in its racial, demographic makeup. A further side of this debate is the power of the consumer. The viewer of commercials in the 1960s did not have access to a simple piece of technology we have all come to rely on, and often mislay, the remote control! It is also widely accepted that many viewers mentally switch off to adverts and to be have any impact a campaign needs to have blanket coverage. The growth of technology since then with interactive TV and developments with personal video recorders (a digital device which stores TV programmes on a hard disc) make it
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more difficult to reach consumers as they have more control over what they watch. For example, the ReplayTV model, a PVR made by SONICBlue, allows you to miss commercial breaks automatically (Pedder, 2002). Finally, viewers have become increasingly immune to the impact of advertising. Self-assessment question (i) Think of how fragmented the media has become. (ii) Develop a list of where your organisation advertises and allocate a rank to it. Develop your list as follows

(iii) Think of the new ways your organisation, or organisations you are familiar with, are trying to reach consumers through TV, the Internet etc.

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8 Advertising
The most obvious form of brand building is through advertising. Traditional advertising (TV adverts, billboards, magazine ads) is one way communication and impersonal. Direct marketing was an attempt to make communication more personal, however, it is expensive beset with problems (data quality, response rates and now the electoral roll issue). The use of CRM, as discussed in the last module, has helped in this area.

8.1 Internet advertising

Internet advertising in the period before the dot com crash was seen as a panacea for the problems facing advertisers. It offers two way communication and some even argue personalisation and customisation enables one to one marketing as, for example, customised advertising related to the content the consumer is viewing is possible. It also appeared cheap compared to traditional media especially the rising costs of advertising on mainstream TV. It also offered a further attraction in financial terms, the ability to measure, which is something advertising had always been criticised for: in the words of Mr Wanmaker from the 19th century I waste half the money I spend on advertising. The problem is, I dont know which half (Sealey, 1999, p2). As studies showed more time was being spent online at the expense of television and these people are of higher income and social groups it seemed Internet advertising was a logical development. Some early results were encouraging, for example, in 1999, Toyotas ads on ESPN.com became its main source of sales leads (Turban, 2002, p177) 8.1.1 Forms of Web advertising This advertising typically takes the form of banner adverts across the top or side of a page with also the use of pop up adverts. Also, have leasing from popular portals: the difference between a banner and a lease is that a lease is permanent whilst a banner only shows up at certain times. For example, visit msn.co.uk and click refresh a few times and see how the ads change. Email campaigns Search engines Mobile phones text messages used Chat rooms Viral advertising

For information on Internet advertising see the Internet advertisement bureau at http://www.iab.net./ In many ways the initial enthusiasm for Internet advertising failed to learn these lessons. Apathy towards banner ads and pop up ads grew quickly and these adverts have very low response rates. This ability to measure responses also confirmed what many thought about advertising in general, that much of it was wasted.
E-Delivery and the brand, element on challenges to the brand

It was discovered that many of these adverts had response rates of less than 1% and most web users saw them as annoying. Users seemed to develop immunity over time as web veterans would just ignore them. This then inevitably led to a massive cut in advertising budgets for the Web and had serious implications for firms whose business model was based on revenue from this source, e.g. Yahoo. The response to this could be that many Internet ads were crude and annoying, perhaps using the techniques of mass marketing. Some argue that correctly used, with an intelligent approach, there is a major role for Internet advertising. The measurement issue also raises another key difference between traditional advertising and web advertising; web advertising is seen as a direct sales channel. For a study on banner ads see http://www.webreference.com/dev/banners. This has some very interesting results on the positioning of banner ads across the screen. Self-assessment question (i) Compare Internet advertising with traditional advertising. (ii) Is there a still a role for Internet advertising?

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9 Interactive marketing and the brand

9.1 Personalisation and the brand
Personalisation presents another challenge to branding, in the sense that brands increasingly have different meanings to different people. Classic brand communication has been based on a tightly controlled brand which tells consumers a message, through advertising for example. As Aaker and Joachimsthaler (2000, page 232) write Traditionally, the most successful brand builders are those who have maintained a relentless focus on the purity of the brand monument. Marlboros brand is solidly planted in its Western imagery because every single communication has been sculpted to perfectly reflect that image In this model consumers are assumed to be passive recipients of value (De Charnetony, 2000). With personalisation, however, consumers have more control over the message they receive, another example being new technologies in TV, which impacts on the ability to communicate the organisations core values to them.

9.2 Interaction and community

De Charnetony (2000) and Aaker and Joachimsthaler (2000) also argues that early attempts at web advertising that many companies initially used were based on this mindset and ignored the communication possibilities of the Internet (e.g. passive ads, brochureware sites). In the e-commerce arena consumers can be linked together through communities and the loyalty of consumers is with both the brand and with the community. Self-assessment question Identify types of community and give an example. Consumers are also involved in co-production, for example, writing reviews of books and ratings as on the Amazon site, inputting data or helping solve technical problems, as on many technology related forums sponsored by organisations (e.g. Cisco). This makes a looser form of brand more appropriate; an example of this is the MotleyFool website which uses its community to generate content and give their views the site (De Charnetony, 2000). Looser brands are also challenging or organisations as this, by definition, involves giving up control; Amazon for example do not allow consumer reviews to be directly published. Looser brand management involves the organisation becoming a participant in a debate amongst equals according to some writers. It can be argued this role becomes that of the conductor which is the same metaphor Drucker used for the role of the manager in the modern organisation in his 1988 HBR paper The coming of the modern organisation. The organisation may also come into conflict with a community, the best example, being Amazon who were discovered to be varying prices by an online bargain hunter community.

E-Delivery and the brand, element on challenges to the brand

Finally, for organisations who do not feel able to loosen their brands in this way other possibilities exist, for example, Kellogg have developed emotional links to their target market for cereals (children) through on-line voting for the naming of characters and the ending of commercials. Perhaps, there are opportunities in this way for many traditional organisations to build interaction with their customers. Self-assessment question Visit the following sites: lastminute.com, nextweekend.com and your own employer. (i) Are these loose or tight brands? Justify your answer. (ii) What are the barriers to looser brands?

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10 Bibliography
Aaker, D.A. (1996) Building Strong Brands, Free Press. Aaker, D.A. and Joachimsthaler, E. (2000) Brand Leadership, Free Press. Adcock, Bradfield, Halborg and Ross (1993) Marketing: Principles and Practice, Pitman Birch A., Gerbert P. and Schneider D., (2000), The age of etail, conquering the new world of electronic shopping, Capstone Breakenridge, D. (2001) Cyberbranding Brand Building in the Digital Economy, Prentice Hall. Carney D. (1999) Fraud on the Net, Business Week, Special Report at http://www.businessweek.com/2000/00_14/b3675038.htm Chaffey D., Mayer D., Johnston K and Ellis-Chadwick F., (2000) Internet Marketing, Financial Times Prentice Hall De Chernatony, L. (2000) Succeeding with brands on the internet. Journal of Brand Management, Vol 8, No 3 pp 186-195. De Chernatony, L. (2001) Characteristics associated with successful e-brands, Birmingham University Business School Working Paper De Kare Silver M. (1999) E-Shock, The Electronic Shopping Revolution: Strategies for Retailers and Manufacturers, MacMillan Dibb S., Simkin L., Pride W.M. and Ferrell O.C. (2000) Third European Edition, Marketing, Houghton Mifflin Durrant C. (2001) Transformative power of e-business over consumer brands, European Management Journal, Vol 19, No. 6, pp 629-637, December 2001. Available at http://ebusiness.mit.edu/research/papers/145 Dussart, Transformative.pdf Accessed April 2002. Evans P. and Wurster T.S. (2000) Blown to Bits, How The New Economics of Information Transforms Strategy, Harvard Business School Press. Website at http://www.blowntobits.com/ Freeman L (1998) Corporate branding gains b-to-b momentum, Advertising ages business marketing, Dec 98, Vol 83, Issue 12, p1 Hagel J. III and Singer M., (1999), Net Worth, Boston: Harvard Business School Press Jurkowich G. and Abrahams D. (2000) Brand Risk Management: Why Brands are Becoming More Valuable and More Vulnerable, Mercer Consulting Viewpoint, Number 1, 2000 Kotler P. (1999) Kotler on Marketing, How to Create, Win and Dominate Markets, Free Press KPMG (2000) Business Alert: A KPMG Singapore Business Information Letter Global Study - Winning strategies in the e-business value chain, October 2000 available at http://www.kpmg.com.sg/newsletter/ba/ba2000_10.pdf Laudon K.C. and Traver C.G. (2002) e-Commerce, business, technology, society Laudon, K.C., and Laudon, J.P. (2002), Seventh Edition, Management Information Systems, Prentice Hall McCorkell G. (1997) Direct and Database Marketing, The Institute of Direct Marketing, Kogan Page Oz E. (2002) Foundations of e-commerce, Prentice Hall Pedder (1999), "A Survey of Television", (2002), The Economist, April Pine B. J. and Gilmore J.H. (1997), Welcome to the Experience Economy , Harvard Business Review, July-August 1998, Vol 76. No. 4

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PriceWaterhouseCoopers (No year given), The European Pensions and Savings Revolution Our Vision for the Future Implications for Financial Services Providers Quelch J. A., and Harding D., (1996), Brand versus private labels: fighting to win Harvard Business Review, Jan/Feb96, Vol. 74 Issue 1, p99 Rennie M.M.T (1999) Copyright Piracy - why Brussels should walk the plank, Parliamentary Information Technology Committee Electronic Commerce & Public Policy Spring 1999 Sealey P. (1999) How E-Commerce Will Trump Brand Management, Harvard Business Review, July-August 1999 Sinha, I. (2000) 'Cost Transparency: The Net's Real Threat to Prices and Brands', Harvard Business Review, 2000, March-April, pp.43-54. Available through EBSCO at http://www.athens.ac.uk/ Turban E., King D., Lee J., Warkentin M., Chung M.H. (2002) Electronic Commerce: A managerial perspective, 2002, Prentice Hall

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Websites
http://www.starbucked.com/ http://www.monopolists.com/ http://www.saigon.com/~nike/ http://www.virginaircrewlies.com/original/florida5.htm http://www.watsonville.com/dakota/ http://www.cokespotlight.org/flash/indexflash.html http://www.untied.com/ http://www.stopesso.com/ http://www.chasebanksucks.com (this site could offend) http://www.lawzone.co.uk/cgi-bin/item.cgi?id=31364 law http://www1.oecd.org/dsti/sti/transpor/tourism/news/CarrollSimon_IHRA.pdf http://www.pertlink.net/otherso/humantouch_ASP.pdf http://specials.ft.com/ln/ftsurveys/industry/sc50ba.htm http://www.searchenginewatch.com/sereport/02/04-dmca.html http://ebusiness.mit.edu/research/papers/145 Dussart, Transformative.pdf http://www.athens.ac.uk/ http://www.strategy-business.com/press/article/?art=313614&pg=0 http://corp.half.ebay.com/pressfiles/wsj06142000.html http://www.business2.com/articles/mag/0,1640,14402%7C5,FF.html http://www.receptional.com/pr_week.htm problems with search engines http://corp.half.ebay.com/pressfiles/wsj06142000.html http://www.kpmg.com.sg/newsletter/ba/ba2000_10.pdf http://uk.news.yahoo.com/020313/218/ctue4.html http://www.epinions.co.uk/ http://www.ecomplaints.com/

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Glossary

E-Delivery and the brand, element on challenges to the brand