How Social Media Has Made Brands Transparent

I've been engrossed in work on social media at Prospect over the past few months, and wanted to marry some of the insights and observations there with some ideas I've had in the pipeline for a while. This article is also available at www.prospect.eu, and covers three key points on why truth, not image, is the new branding.


In particular, we have seen how social media has brought about a new age of branding transparency, where the happiness of customers instantly affects the value of a brand. There are three trends which help explain this:


1. Branding Is Returning To Its Roots As 'Reputation'

Brands are simply the reputation of a business as it was upheld at any moment in the minds of its customers. Before the sophisticated brand machinery of advertising, design, semiotics and visual identity, this was entirely influenced by the quality and consistency of a product or service.

We are coming full circle. Social media's effect of increasing transparency has withered the power and persuasiveness of flashy-smoke-and-mirrors branding. Once again, the products and services must do the talking. Brand equity is directly and immediately linked to the quality of experience you provide.

A painful-to-watch example of this is United Airlines. A disgruntled band watched in horror out of the plane window as they saw their instruments being thrown around by baggage handlers. After nine months seeking compensation for broken instruments, they decided to complain by writing a song, which is approaching 9,000,000 views on YouTube. It's also credited as the main cause of a 10% drop in share price which cost United an estimated $180m. United's out-dated response was a schmaltzy ad campaign. Deflatingly, the online comments greeting their efforts were peppered with mischievous wails of 'United breaks guitars!'. The whitewash had not worked.

2. Customers Are The Advertising Campaign

'Happy customers are your best advertisement' sounds like a whimsical old cliché from a village butchers, but word of mouth has quickly re-established itself as the dominant marketing force and is more relevant now than it has ever been. And it's certainly not just about the small-scale and local who have that much face-to-face time with customers.

Apple, who recently overtook Microsoft to become the highest-valued technology company in the world at $152bn, have taken this to heart and apply it very well. For every expensive advertisement you have seen on TV or online you have probably had a dozen friends or colleagues nudge you to show you their latest iPhone app or tell you "PCs are rubbish. Why don't you get rid of that thing and buy a Mac like this one I'm hugging right now?"

These nudges aren't just happening in person. The savvy purchaser will do a little online research while weighing up their choices, and in a few minutes can be exposed to hundreds of like-minded opinions and experiences. What the customer hears in these critical moments holds a huge sway over whether they buy in or walk away.

3. Customers Are The Boss

Imagine your website as a high street shop and a new customer approaching it. Now imagine hundreds of previous customers standing outside, some shouting in protest and warning the customer away, others singing with elation, 5-star rating placards in hand.

You have the ability to influence the crowd, but the more you use the megaphone, the worse things get. You need to listen to every one in turn and try and resolve their individual cases. You cannot win over everybody, but you need to make sure that the new customer will be tempted in, and at the least, will not be scared away.

Moreover, you have the opportunity to get in touch with the disappointed customers, find out what went wrong, and try to convnice them to stay whilst improving your offer in the process. The customer is always right when talking about their personal, subjective experiences. It's up to the business to provide a better experience in the first place.

Conclusion

As this new mainline has opened up between customers and an organisation's brand, it is the customers, not the providers that have taken the initiative. It has accelerated the movement of feet, allowed easy comparison of competitors and lifted the roof of organisations to allow customers to look inside.

While there is much for businesses and organisations to be wary of, the greatest sin of all is not embracing it. Users will reward the provider who gets it right with loyalty, upgrading, compliance and spreading the word. And quickly. In a time of instantaneous brand re-assessment through social media, your reputation is what you do and your brand equity depends upon what your customers think of the quality of experience you provide.