Living Brands Requirements for Brands in the Digital Economy Redefined

The marketing discourse of the past 10 years was dominated by stagnation and depression. Advertising at the edge of perception, inexpedient segmentation of target groups, continuously revised and adapted manifestations of marketing tools provoking at best a three to five percent return, squibbed marketing budgets – the former marketing director of Coca Cola, Sergio Zyman, preaches the ”The end of marketing as we know it“ and the renowned marketing expert Stephen Brown even conjures up a ”Marketing Apocalypse“. This paper attempts to analyze the revolutionary transformation of consumption patterns and thus of marketing – and to offer new approaches to branding in the digital economy by introducing the concept of Living Brands. 1. Systems in Transition Information and communication technologies have brought about evolutionary and revolutionary shifts in the revenue networks and models. In the digital economy, the Living Brands Requirements for Brands in the Digital Economy Redefined 137 classic dichotomy between producer and consumer, based upon mass markets, is dismantled by complex networks whose members notify each other in a more or less organized way about their needs and wants as well as about their economic consumption. Compared to the “fordistic” mass production, the customers steadily increase their power; their dynamically shifting needs and wants, influenced by a number of cognitive and social factors, thus become the decisive commodities of the value chain. Consumers have received access to several touch points in the value network. 1.1 The Activated Consumer The human environment has undergone vast changes that brought about a massive transformation of the consumers. A number of aspects of evolution were initiated by technology. Also the well-documented and sociologically established change in social values, which is not being treated in this paper in detail, was partly stimulated by technological revolution. DIGITAL REVOLUTION. Represented by computers, the Internet, game consoles, DVD devices, mobile devices, etc. and among others the development of the entertainment industry (TV, movies, concerts...), promise quickly accessible glossy and glamour information for the customers polished, far from reality, idealized, stereotypical. INFORMATION SOCIETY. The tools mentioned above provide immediate access to current information and above all, information by far exceeding the actual need. The consumers are well informed and are endowed with knowledge unprecedented in history. Consequently, the consumers have become more skeptical and critical of businesses and information, e.g. especially with regard to prices. Since the prices (and to a limited extent also the quality) of the competitors are available only mouse-clicks away, premises based on price that have been communicated by brands discontinue. Only strong brand personalities will survive the information overload. SOVEREIGNTY OF INFORMATION. Primarily the Internet enables consumers to choose independently and individually which content to make use of. As a result, it induces people to obtain information of their choice at their pleasure and convenience. PEOPLE IN NETWORKS. Increased skepticism and sensitivity on behalf of consumers lead to a growing distrust in huge, multi-national companies, and as a consequence, consumers have started to organize themselves in networks and communities in order to stand up against these businesses. People in networks negotiate prices (e.g. power-shopping); they exchange information and experiences;