In Part 1 of the value of 360° brand development, we discussed the value of collaboration and in Part 2 we explored what were the keys to success. In Part 3, we explore how brands and ownership of brands are evolving.
Historically, brands have been “owned” by the organizations, products, or services themselves. This means that the majority of the information about the brand was communicated to the public (or target audience) by the brand itself. The brand created the value/benefit for its customers (and potential customers) by being the “authority” for all information about the brand or product.
With the advent of the Internet and social networking, brand ownership has evolved to being “owned” by the customers (current, past, and potential). As noted by Jim Blasingame in The Age of the Customer, the majority of control over a brand (e.g., user-generated content, product information and reviews, and buying decisions) is now controlled predominately by the customer.
According to Website Builder Expert, 95% of all shoppers read online reviews before making a purchase. Among Gen-Zs and Millennials, they need to see at least 181 reviews to gain trust in that product or brand, and over a third say their trust in a brand increased after seeing an influencer’s review or promotion. Achieving brand trust with Boomers is slightly easier since they require only 42 reviews to gain trust.
Finally, the power of online reviews is significant. Displaying reviews can increase conversion by 270%. It takes 40 good reviews to undo the damage caused by one bad review. And sadly, only 1 in 10 happy customers actually leave a positive review.
So, what does that mean for brands? First many see social media and networking as a “free media.” The reality is all brands need to invest resources in proactive social media/networking in particular as it relates to brand reputation management. The investment must be in terms of staff empowered and with sufficient knowledge to engage, inform, and respond to social media interactions. Successful brands will recognize that their active participation in social media/networking will reap huge rewards in building brand value and equity.