The delusion that digital transactions build brands

Delusion is like coffee. You need it first thing in the morning to restore your sense of being.

A substantial crop of corporate executives are deluded to think that digital transaction alone can build brands. Ignorance, euphoria and the self-serving ecosystem of beneficiaries that surrounds them feeds this delusion.

At a recent ‘big stage’ event where I was speaking, a digital agency honcho proudly pointed to the fact that there is no need for story. The cash register has to be moved one click away from the consumer. A vastly more economical and efficient method, in his reckoning, than to do the multimedia, attribution rich brand building that eventually generates demand.

Someone chimed in to affirm “Hunters not farmers “

Today digital sells ‘measurable’ eyeballs just as TV does. It also has greater dependence on it, not having subscription and affiliation revenues.

In other words, upon extrapolation, one can say that the ultimate result of performance and online sales media is that there will be no thematic advertising. Certainly not advertising of the kind that believed in big ideas and in investing money to transform attitudes and behavior.

Instead, there will be more process and efficiency, the stuff that technology is good at, but that undermines the uniqueness of media and hence its value.

The digital online sales enablement as a connective tissue, an ecosystem or a funnel whose main objective is sales but which also does engagement and advertising for brand building is merely a case of ‘the emperor’s newest clothes’.

Every branded digital platform that is born to satisfy the belief that digital transaction builders are also brand community builders has failed. There are good reasons for it. Firstly, Utility is the exact opposite of a brand. For a utility, merely to be present and efficient is sufficient. For a brand, there has to be meaning and engagement. As an aside, this is perhaps by “utility brands” are flaky, transient, and ephemeral.

Utility is a force that cancels the branding out. A brand asks for an experience, awareness and consideration, whereas a utility is incognito. The less you’re aware of utility, the better it is deemed to be a brand exist in an environment with a narrative. A utility is merely a channel or a modality. A brand is on a stage always facing consumers, whereas a utility is in the back room.

Brand builders entice a following by showing off environment, engagement and experience. Facebook is a classic example of user generated content in a participatory media. Users put out a content stream for one another. It cost Facebook nothing. For this, the brand gets Media at no media cost.

A sales community portal has an inherent identity trap. A good brand must be defined with a good audience for its media. So, it is important to lower all barriers in reaching the audience. Where is the organic audience of intenders for transaction platforms? Where will you find them?

Therefore, you will end up inflating the audience with directed traffic, offers, discounts, etc. As the audience becomes scarce, you chase it with more money.

Soon, it will not be about what you say to the intenders, but how you reach them.

Digital had a clear opportunity. It could assemble and support a free audience with more accurate and detailed measurability than traditional media. It could give you a precise count of viewers, their actions and their engagement. This came with mouthwatering personal data and preferences.

Bu, measurement could only show the dearth of and the lack of value in this audience.

A community is not traffic.

Traffic is not audience

There is no structural way of making people pay attention forever. Therefore, to overcome traffic failures, you end up chasing audience, growth, and more money goes behind less return.

Now, one can argue that the other side of measurability namely that of a traceable audience with definable behavior patterns is of value. You can count it, categorise it and could manipulate it. You see what stimuli it responded to. Therefore, you can put that knowledge to the service of your product. At the same time, it was put to the service, not of selling more products, but of moving or producing more traffic.

This became a key metric of digital section platforms: traffic aggregation. In the beginning there was a pure arbitrage of simply buying traffic for less than you could earn it. But on such platforms, ad buyers getting smart to the arbitrage drove ad pricing down just as the demand for traffic went up. Then came an era of pitching to search engines—search engine optimization. Everybody needed an SEO specialist. The skill here was in what information you put on a page to prompt Google to put your page higher in their search rankings.

But the caravan moved on. Search engine optimization moved to “social strategy”—and we landed in the Meta world. 

In other words, nobody owned their audience; they just owned technology and process, at the whims and fancies of a Facebook and Google.

At best, you create a drive-by audience, and one that costs more to get than you can make on it.

What’s more, you don’t really own an audience. No audience is truly seeking you out. No audience is actually saying they like what you do. No audience is in the end attesting to your value.

Other than through gimmicks, you don’t really exist. Or, to the extent that you do have a core audience, it is too small to support the business you’ve built off the illusion of a much larger audience.

Why do you think D2C brands decided to go brick and mortar at exactly the same time that their valuations touched all-time highs?

Where do you think the Ed Tech revolution disappeared to?

How many fashion brands can rely on configurators to do their job?

A growth in sales enabled digital traction with a shrinkage of the brand turns even the most highly valued digital site into something transactional, dull, repetitive, and of low value. Eventually, it doesn’t warrant and cannot sustain focus, attention, identification or engagement.

But the party is on. And the big ones want a digital sales world to build brands.

As Gustave Flaubert said “To be stupid, selfish, and have good health are three requirements for happiness, though if stupidity is lacking, all is lost.”

Disclaimer: The views expressed here are solely those of the author and do not in any way represent the views of exchange4media.com.