The Domino Theory Of Branding

Currently only 1.5 million Internet households enjoy the rarified atmosphere of high bandwidth surf-and-search. This number is expected to jump to 16 million by 2002, according to Jupiter Communications.

At the same time, the rich media portion of total advertising expenditures will grow from 10 to 30 percent by 2002. Not by chance, the direct marketing -centric online advertising community will migrate a portion of its advertising budgets from direct response to distinct online branding campaigns.

Much discussion has occurred in this and other forums regarding the merits of the Internet as a medium for direct response as opposed to branding. While the Internet is and will remain for the foreseeable future the best direct response medium on the planet, it is (and will increasingly) become an efficient and effective branding medium.

Arguments against branding on the Internet fail to answer a single yet critical question: Why would the Internet be the first and only medium in the history of advertising not to be a branding vehicle? Branding is all pervasive in a capitalist society. Take your shoe off and look inside there’s branding there.

As we evolve from one-to-many to one-to-few and eventually one-to-one marketing on the Net, direct response will no doubt remain a significant and primary method of advertising, but that in and of itself does not exclude an increase in branding. In fact, it will be just the opposite as we see the direct response-branding convergence continue.

No doubt most of the rich media ads will be more than branding, will be full-screen click to buy ads that can be considered direct response, which of course they will be. But why surgically categorize branding ads and direct response ads? As we see the convergence of advertising and sponsorships, so be it between direct response and branding.

If the viewer checking local weather on MyYahoo opens a full screen fat media window, downloads a coupon, makes an immediate purchase and also remembers the full-motion dancing logo while whistling the jingle, do we have a direct response ad or a branding ad or both?

Does it matter? Would any marketer not want their product or service remembered as part of a purchase? The answer is as obvious as a hyped IPO.

Brand advertising — more than call to action, click-me-baby banners and buttons — needs a sustainable visual burned into your consciousness. Branding needs rich media advertising. And rich media advertising needs bandwidth. According to Jupiter, the most formidable obstacles to a wider adoption of rich media advertising are perceived viewer objections and lack of bandwidth.

Sue Levin, president of HerAgency.com, parent company WWWomen.com, says, “At HerAgency.com, the objections we run into with rich media ads focus on bandwidth and viewer resistance. As bandwidth increases and appropriate value targeting improves, we are quite confident those objections will fade away and we will see a dramatic increase in the use of rich media ads, especially with branding campaigns as more of the consumer advertising giants allocate more of their ad budgets to the Internet.”

The Internet has always been and always will be a direct response vehicle, but so it is with branding. How did you first become aware of Amazon.com? Was it by surfing for rivers formed during the Paleolithic Period or perhaps did a friend tell you about this great book site? Were you looking for tall women or did you notice (and remember) a banner for a company with the seemingly unrelated name selling books? Branding has been a part of the Internet since commercialization began.

As far back as 1997, an IAB Online Advertising Effectiveness Study showed that on average, the brand value of the banner ad exposure was significantly greater than the value of the click-through. Branding on the Internet is not new. But with the practical reality of bandwidth approaching the level of hype in the next few years, branding on the Internet will increase incrementally, and then some.

And how do you brand? Advertising, advertising, advertising. Brand advertising requires repetition, recognition and reality. Repetition (the product or service positioning), recognition (recognizable and memorable logo and name), and reality (real value to the consumer) are the hallmarks of a good branding ad and a good interactive rich media ad.

These variables are far easier to accomplish in a targeted interactive rich media ad than in a standard static or animated banner ad. Repeated studies, most noticeably those by Wired/Millard Brown and Berkeley Systems, have shown that rich media ads are effective branding tools. The Millward Brown study showed brand awareness, recall, and positive perception were all significantly higher for rich media banners over standard banners, as were click-through rates.

Says 24/7 Media Senior Vice President-Worldwide Business Development Mark Burchill, “The inevitable increase in bandwidth and rich media advertising will bring in a whole new category of advertisers that have yet to play a major role in online advertising * specifically, packaged goods advertisers.”

The bandwidth ball has started bouncing, and advertisers will follow along as it builds on its own perpetual motion machine. The announcement of Cyclone, the high bandwidth version of Snap, the @Home-Excite deal, and most recently the Yahoo/Broadcast.com buyout, as well the various cable-RBOC deals illustrate the belief in a higher bandwidth future. These deals would not occur if the participants did not see a revenue generating business model to build upon them.

As bandwidth increases so will rich media ads, already shown to be more effective than traditional banners as well as TV ads in terms of viewer retention (branding!). Again, rich media ads are expected to be 30 percent of a projected $7.2 billion online ad spend in 2002, and much of that will be due to B and B, bandwidth and branding. The more andwidth, the more rich media ads, the more rich media ads, the more branding.

Call it the online branding domino theory if you wish.