5 examples of the impact of digitalisation

Brands are an organisation’s most important intangible asset. According to Brand Finance, brands even represent 18% of the market value of organisations. Yet within organisations, brand management often fails to get the attention it deserves.

The importance of innovation

The world is changing fast. To be ready for the future, it is important that a brand moves continuously with market developments. This is not only about developments in technology, but also about societal change. Consumers, for instance, increasingly value brands that are sincere and have a ‘purpose’ – that make a positive contribution to society.

New developments bring opportunities, but also challenges. That organisations need to act on them is clear: doing nothing erodes brand value. Organisations face five digital developments that determine how future-proof their brands are:

1. The rise of 5G

The 5G network has a major impact on the user experience (UX) and on brand experience. Limitations in data speed will be a thing of the past and more data will be available, clearing the way for unlimited, user-tailored (video) content.

2. Artificial intelligence (AI) and machine learning (ML)

AI and ML make it possible to serve customers even better, with products fully tailored to their personal preferences and characteristics. Think of Google Now, or Amazon’s recommendations. As a result, brands become more closely woven into customers’ daily lives.

3. The Internet of Things (IoT)

The IoT means all of our devices are connected to each other via the internet. That interconnection demands transparency from organisations about their products and services. Brand experience moves centre stage, and a strong reputation contributes to it.

4. Digital reality: virtual reality (VR), augmented reality (AR), mixed reality (MR)

Digital realities offer customers and prospects new, creative ways to genuinely experience products and services. Brands need to adapt their traditional customer journey to this versatile, multisensory experience.

5. Voice-controlled devices: voice marketing and branding

As soon as people use voice-controlled devices to buy products or services, those devices take over part of the product comparison and decision-making. That gives voice search an enormous impact on brands’ SEO strategy, as well as on the entire customer journey.

Fragmented brand ownership

The impact of digitalisation on brand experience, and the importance of the brand itself, is increasingly on the radar of boards of directors. Even so, purposeful and structural investment in making brands future-proof fails to materialise. This is usually the result of a lack of ownership. In many companies the brand is one of the least organised disciplines. The work and the responsibilities are fragmented across the organisation. Corporate communications, marketing, HR, sales and the board all work with the brand, but nobody has sight of, or a grip on, the total body of work and resources deployed on its behalf.

“In many companies the brand is one of the least organised disciplines.”

Good, efficient brand management needs a central point of contact, such as a brand owner. Someone who can operate across departments and who has a mandate at board level. This brand manager creates resources in which the brand values are anchored and offers them to the rest of the organisation as building blocks. That gets departments working on the brand together. Responsibilities need to be assigned at strategic, tactical and operational level. The brand manager does not act as brand-identity police, but works as a facilitator and brand organiser towards a future-proof brand, and makes sure the importance of brand management stays top of mind in the board. Ultimate responsibility for setting brand objectives, formulating a brand strategy and making long-term budget available sits with the board. It is therefore important that the brand manager speaks the board’s language.

The ROI of brand management

The return on investment (ROI) of brand management is hard to measure. As a result, branding is often seen as nothing more than a cost item and gets no priority in the board. On top of that, brand managers – where they exist at all – struggle to sell the added value of the investment to board members who think in financial terms.

If they speak the board’s language and explain branding in terms of added value and euros, or if brands can be made visible on the balance sheet, as is often the case with acquired brands, a barrier is removed. To give an example: the LinkedIn brand sits on Microsoft’s balance sheet, which allows the software developer to monitor the value development of the brand it acquired. This really ought to be the case for every brand.

Working on future-proofing

Once the brand manager is appointed and board members have taken the importance of brand management on board, the road to brand innovation is clear. The brand owner can get straight to work on making the brand and the brand organisation future-proof. Three tips that help:

1. Stay true to your authentic (brand) story

Determine what your brand really means to your organisation and why your organisation matters. Bring the brand back to where it belongs: close to the business strategy and to your organisation’s reason for being. This is precisely why the brand belongs in the boardroom. The brand should guide everything the organisation does.

2. Define how you want to organise your brand in future

All this change means we need to redefine what the brand organisation looks like. Moving on from the centralised brand control of the past, the search is now for a form of organisation that facilitates dialogue and interaction while at the same time safeguarding the brand’s DNA in every expression. The brand organisation needs to be set up to be future-proof.

3. Brand analytics: make your brand performance measurable

Insight into the value of the brand, and into how the various channels and brand carriers contribute to overall brand performance, matters for a future-proof brand. Make sure your analyses express this in figures wherever possible. Board members are generally interested in hard data. Numbers and insights about the brand help build support for brand management within the board.

A strong, future-proof brand is an absolute necessity if an organisation is to hold its own in a diverse and growing brand landscape. So if the brand does not yet feature prominently in your plans for 2019, it is time to change course.