Internet can cut both ways for brand management - Daniel Muzka

A few months ago, I had a series of conversations with managers who reflected on the increasing difficulty of managing the perception of their brand. They told stories of customer complaints spreading like wildfire through the Web before they had a chance to deal with them, and opinions expressed in blogs and forwarded e-mails by some of their detractors that appeared to be magically reprocessed into fact.

You don't have to search hard to find examples of such challenges. An international fast-food chain is sideswiped by images available on YouTube of rats roaming freely in one of their outlets. A global apparel maker contends with allegations, published online, of operating sweatshops.

No matter our organization or place in the world, we will all have to deal with some issue - fact or fiction - that has become real or has achieved greater proportions as it winds its way through the Web.

This has all led me to a series of questions. Is it more difficult to manage brands in an Internet world? Does this latest "noise" matter? And finally, what have we learned about managing brands, and managing the message, in this environment?

Is it harder today? On balance the evidence weighs heavily on the "yes" side. The 2007 media landscape - which now includes blogs, wikis, social networking sites and message boards - is far more complex than the one companies experienced even a decade ago.

Consumer word-of-mouth has forever existed in established media. Radio and television talk shows, newspaper editorials and special interest newsletters have served as consumer forums for brand commentary for quite some time.

The difference today is that commentary travels faster and potentially reaches more people through the web of personal networks we find in cyberspace.

The consequence is that firms often have less time to react to what is being said about their brands. Consider the impact Orson Welles might have made in cyberspace.

In his 1938 radio enactment of H.G. Wells' The War of the Worlds, fiction became fact for thousands, even though the new "reality" was contradicted by what they observed out their windows! How many people might he have influenced had his message travelled online?

Does all of this really have any impact? I would argue that corporate brand reputation management is a critical challenge for today's business leaders.

The impact of these new channels is undeniable. In 2005, for example, a blogger named Jeff Jarvis decided to take Dell Inc. to task for his struggles with the computing giant's customer service unit. He posted a series of articles to his blog, titled "Dell Hell," which became among the most read in the blogosphere and emboldened others online to take aim as well. Suffice to say, Dell fully appreciates the brand impact of these new channels.

Customers and other stakeholders control the company message as much, or more, than companies do; and, by controlling the message, can truly influence brand perception. And we all know the importance of one's brand in everything from sales growth and employee hiring to stock price.

Recent research from my colleague at the Sauder School of Business, Marcin Kacperczyk, demonstrated that being perceived as a publicly "sinful" stock has its cost in diminished institutional investment.

Finally, let me share some of what we have learned about managing the message, the perception and the brand in light of these new information channels.

First, actively monitor the messages out there. It is an extension of something marketing experts have been advising for years: Listen.

Second, use the observed ideas and messages to inform your continuing marketing and communications plan and actions. You can react indirectly to negative or incorrect messaging.

Third, be careful about where, how, and when you take action. Consider the size and reach of these online forums.

Many are small in size and their discussions have little impact beyond their circle. Intervening in their discussions is unlikely to change their point of view and may draw even more attention to their comments. In short, be wary of appearing heavy-handed.

Fourth, do fully disclose who you are when communicating online.

We have seen the emergence of non-disclosed commercial bloggers - sometimes known as fake bloggers or floggers - who actively promote their brands. This practice is deemed so contentious that some companies have explicitly banned the practice in their code of ethical communication practices.

Finally, you can use some of the new venues to actively carry on a dialogue and solicit ideas.

Last spring, in an ambitious move, General Motors allowed Internet users to create commercials about the company's Chevy Tahoe. More than a few of the online ads put the SUV in an unflattering light, but it did provide a forum for new ideas. When you do open the doors, however, realize that anyone can walk in.

The good news: Strong brands still stand despite this complexity. Well managed brands like Apple and Starbucks continue to ride high. Recent research by Patrali Chatterjee of Rutgers University showed the positive benefits of a strong brand or product, as represented by strong consumer familiarity, in mitigating the impact of negative consumer reviews online: People are less likely to listen to disparaging and confusing messages if the brand is known and delivers on its promise.

New information paths do require new measures and a stronger dose of monitoring. The new paths, however, can help as well as hurt in managing your brand.