Realize Corporate Image Equity - Create Value Experiences Online, Conclusions

Research has shown that a Web presence complements traditional brick-and-mortar stores by helping to create awareness, make impressions, supply details, drive store traffic, and generate prospects (Maddox, Mehta & Daubek, 1997). Having a Web site is important for brand building and creating a favorable corporate image (Berthon, Pitt & Watson, 1996; Farr, 1999). However, that alone is not sufficient.

First, firms should strive to create a strong Internet identity through a distinctive personality. Recognizing that a company’s name identifies it to outside observers (Aaker, 1991), For example, Tiffany, the well-known

jewelry retailer, invested substantially in digital imaging technology to ensure that all images of jewelry on its Web site are presented using high quality graphics. The overall impact of the Web site reinforces Tiffany’s reputation as a prestigious high-quality retailer.

Second, firms should ensure there is sustained buzz about the firm’s presence. Many online firms use banner advertisements, pop-up windows, and mass e-mails to promote their products. Advertising directly confers brand and product information to consumers, and it serves to increase consumers’ awareness and knowledge of a particular brand (Vakratsas & Ambler, 1999). High levels of advertising expenditures send a strong signal about a firm’s commitment to quality (Shapiro, 1983). For example, Amazon.com invests more than 23% of its revenues in advertising, thus making it one of the most well-known companies in online book retail business.

While advertising remains an important element of the online business model, firms should strive to have a balanced mix of online advertising and off-line brand communications. One important off-line communication source that companies should pay more attention to is interpersonal encounters or word-of-mouth (WOM). According to Buttle (1998), WOM is, in general, more influential on behavior than other organization-controlled sources.

Finally, firms should strive to earn a reputation for being innovative. Generally, research has found that early movers enjoy initial and sustain continuous market share advantages. For example, Robinson and Fornell (1985) suggested that being a pioneer or product leader gives consumers a favorable image and higher familiarity on the firm’s products. Examples of online firms that attain such leadership include Priceline.com, which pioneered the "name your own price" practice in its travel booking service, and eBay, which introduced the proxy bidding technology and feedback mechanism in its Internet auction business.

Create Value Experiences Online

In this section, actionable strategies relating to two important areas – target marketing and enriching the customers’ online experience – will be discussed.

Target Marketing. A thorough understanding of one’s target audience is critical. With a better understanding of the target market, businesses will be able to better design their Web sites to match preferences of their target groups. Two crucial areas need to be addressed: How do customers make purchasing decisions, and what information do they need in making those decisions? Wine.com, a leading purveyor of wine and gourmet products, originally believed that its core customers were wine connoisseurs. A careful assessment of online data revealed that its best customers were wine novices. With this knowledge, Wine.com significantly modified its Web site to deliver the features these less experienced consumers wanted–recommendations and educational content.

Enrich the Customers’ Online Experience. The natural question, once marketing managers know who their best customers are, is how to enrich these customers overall experience. One suggestion marketing managers may want to focus their efforts on is customization. Customization increases the probability that customers will find something that they wish to buy, creates the perception of increased choice by enabling a quick focus on what the customer really wants (Shostak, 1987), signals high quality (Ostrom & Iacobucci, 1995), and drives customers to use simplistic decision rules to narrow down the alternatives (Kahn, 1998). In this respect, customization has often been regarded as one of the essential determinants of customer loyalty (Reynolds & Beatty, 1999).

Managers may also want to focus on improving Web site convenience. A convenient Web site provides a short response time, facilitates fast completion of a transaction, and minimizes customer effort. For example, Weyerhauser, a forest products company, manages its door-making through a customized Internet system in which the customer inputs specifications that are then electronically digitized into profile information that drives the manufacture of that particular door. By providing convenience and customized experience for customers, Weyerhauser is able to enhance its customers’ online experience.

Conclusions

Marketers are perpetually seeking to increase customer loyalty, which perhaps is the only source of sustainable competitive advantage in the coming decade for many firms. This chapter suggests strategies for firms to develop an e-customer relationship orientation and improve e-customer loyalty. In this aspect, corporate image, customer trust, and customer value were found to be important drivers of e-customer loyalty.

To enable more compelling value propositions to be crafted, future research could examine the moderating effects of consumer attributes like involvement and affect on the model. For example, depending on the level of involvement, consumers may be passive or active when receiving advertising communication, which in turn could moderate their perceptions of value and trust levels. Empirical comparison between different cultures could also be collated for greater generalizations of the proposed model.