The erosion of brand equity has been a constant force as the number of brands and consumer options have proliferated over time, and as many leading brands have shifted their focus from building long-term brand equity to boosting short-term sales. But some startling new research from GroupM's Wavemaker unit reveals that those behaviors become much more exaggerated when the consumer's "path to purchase" journey takes place online vs. the physical world.
I got an early brief of the study (which is being released today) from Wavemaker Chief Strategy Officer Dennis Potgraven, and he agreed that while the deterioration of brand equity has been an ongoing battle, there is now an empirical measure of the impact ecommerce has been having on it.
The study, which likely was impacted by the acceleration of ecommerce purchasing during the COVID-19 pandemic, actually cover a two-year period, so Potgraven considers it a reasonable baseline for looking at the broader shifts taking place in consumer behavior.
The study indicates that there are variances by specific product categories, but the overall net is that consumers consider about 50% more brands during an online purchasing experience than they do during an offline one, and the material impact is that the consumer's original brand choice often gets bumped by an alternative ecommerce when they are buying online. How much varies, but the Wavemaker research indicates that, on average, brands that had a "strong priming bias" -- meaning the consumer was exposed to ads and marketing that got them into the purchase funnel in the first place -- experienced an 8% greater loss in conversions than if they were being bought in the physical world.
"In general, this shows that consumers are getting less attached to brands," Potgraven says, noting that the its a simple function of the abundance of choice and the frictionless ability to shift brand choices when buying online.
The Wavemaker report there currently are about 350 million products listed on Amazon, as an example.
As foreboding as that might seem for major brands to compete with, Potgraven says it's not hopeless and that Wavemaker's research shows there are a number of things brands can do to offset the abundance of alternative choices.
The report goes into great detail, but the bottom line is summarized by the following steps likely to increase a brand's "stickiness:"
Stronger online brand bias is established by synergizing brand and eCommerce campaigns also in addition to using both offline and online media
Building strong “product icons” that are consistently supported throughout brand communications to build stronger online brands, instead of simply brand value messaging
Consistency in message, visual and media usage is more important than ever to uplift final conversion, in a more scrutinized online path to purchase with 25% more actions and 43% more touchpoints used
Preference building continues to be important in the active stage. While the offline buying CDJ is predominantly focused on conversion, consumers still switch more easily during the online journey. Brand preference is also built on active experiences like CX