NONE: Re: ONLINE-ADS>> The Amazon.com model
Re: ONLINE-ADS>> The Amazon.com model
Bob Schmidt (schmidt_at_magicnet.net)
Tue, 29 Jul 1997 23:28:16 -0400
Leo Sheiner writes,
>I do not feel qualified to answer Jason's question about the importance
>of brand recognition in this context accept I can suggest why not suck it
>and see.
Without claiming to be any more qualified than Leo claims, I will take a
stab at the brand issue with some random observations.
In the case of a bookstore, in my opinion, the brand identity is going to
be somewhat of a weak factor in the purchasing decision. The fact is, every
book in print is readily available for purchase from the publisher if
through no other venue. And sooner or later every bibliophile figures this
out. In addition, the vast majority of in print books are now distributed
through one wholesaler: Ingram. Since all bookstores buy from this
wholesaler, the wholesaler;s inventory becomes the inventory of any
bookstore. While this circumstance gave Amazon the full product line it
needed, it is not a unique selling proposition that cannot be matched by
any other bookseller.
What made Amazon so unique was its innovation of online retailing with all
the concomitant characteristics we have come to expect, convenience, ease
of ordering and selection uppermost among the list. The fact that this
innovation was so aptly applied to the sale of a low tech item, and that it
is an item of information which is being sold in a medium of free
information adds a delicious twist of irony to their accomplishment and
proves the point I have made before in other lists that a marketing
opportunity often lies in breaking the rules rather than following them.
A sense of community and some limited interactive aspects also fall in the
category of what we expect online. But are the interactive aspects
compelling, persuasive or the determining factor in the purchasing
decision? I think it is doubtful. Now we can also suppose that the whole is
greater than the sum of the parts and say that it is none of these things
but rather all of these things which go into forming the Amazon.com brand.
And there may be something to this, but I think not as far as being an
antidote to brand erosion.
The landscape is littered with brands who were first and ended up being
last: Diet Rite Cola, who can even name the first decaffinated coffee, the
first toothpaste with sodium flouride, the first personal computer? So,
clearly, being first is not an enviable position to be in. In fact, it's
not even memorable. What I think accrues most to the Amazon.com brand is
the idea of innovation itself. I think that is the area of greatest
leverage for them and I believe it is also their most vulnerable area and
their greatest challenge.
The fact is, there is little to differentiate one modern retailer from
another. The bookstore is without doubt one of the clearest examples of
this. In the real bookstore, personal service and "atmosphere" (read coffe
shop) has become a differntiating factor which has now trended to the
commonplace. Now that every bookstore sells bagels, how does the hapless
book buyer choose between them? The bagel may be more important than the book.
If I need or want a book right now, today, this instant, I will go to the
neighborhood bookstore and take my chances. If they have it great. No
online retailer can ever compete against this. If they don't have the book,
I can order it on the spot and wait, or I can go home, log on and order it
online, and wait. I might "save" some money by getting a discount price
online and not have to pay sales tax, but likely any such savings will be
eaten up (or exceeded) by the shipping cost. So it may actually cost more
to buy online and may not be any faster. Either way, locally or online,
each bookseller will make the same call to the same source: Ingram or the
publisher. Determining just how important the the brand can possibly be in
this circumstance is problematic.
>From the standpoint of the opportunistic web site owner who seeks to cash
in on the sale of merchandise his visitors purchase from another web site,
brand may indeed be important. But not as far as selling books. Rather, in
the benefits which accrue to the site owner by associating his site with
that of a known and respected brand or site. The effect being an implied
third party endorsement. "Wow, Amazon.com lets him put a link to their
store on his site or pays him to do it. That's cool. Of course, I;m much
more interested in myself than in this guy and his web site, so, even
though I don't have a link on my site, maybe I can be cool too if I just
click over to Amazon." And away they go. The question is, will a customer
who feels cool buy books? Or, maybe they don't go because, what with the
popularity and so on, they've already visited before and see no need to go
back. Obviously just spreading a brand name all over the Internet can reach
the point of diminishing returns. When does one stop noticing the Netscape
Now and IE banners at the bottom of every web site? I stopped noticing them
months ago.<g>
Bob Schmidt
Orlando Florida
www.provider.com
Author of The Geek's Guide to Internet Business Success
Published by Van Nostrand Reinhold
Coming August 1997 to a bookstore near you (and your computer)
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