The impact of intermediaries: How brands can close the gap between themselves and consumers

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The very concept of how people buy has fundamentally changed, due to the emergence of digital platforms like search engines, online reviews, social media and e-commerce marketplaces. This new online landscape has led to a rapidly expanding gap between consumers and the brands they shop for.

To better understand this widening disconnect, we first need to examine the core of this shift in shopping: a change in the consumer profile. Mobile-conscious digital natives, particularly millennials and Generation Z shoppers, are becoming the trendsetters and tastemakers in our society.

Not only has Pew Research reported that millennials have surpassed other generations — even baby boomers — in total numbers, but they also spend about $600 billion a year in the US, according to Accenture. “Gen BuY” authors Kit Yarrow and Jayne O’Donnell say millennial, or Generation Y, shoppers spend 25 percent to 40 percent more than the average consumer and will spend $10 trillion in their lifetimes.

Digital platforms reshaping retail

This collective buying power demands that brands and agencies adapt to the shopping preferences of millennials and members of Gen Z or run the risk of being left behind, as digitally savvy consumers are disconnected from brands when they turn to digital platforms. Consumers now say, “I’ll Google it,” or “I’ll buy it on Amazon” when they talk about products, establishing platform loyalty instead of brand loyalty.

There’s no better proof of this than the current conversation going on in the retail world over the impact of Amazon. Much of this conversation focuses on the issue of competition between brick-and-mortar retail stores and the e-commerce giant; take the showdown happening with Walmart now, for example.

The change in how consumers become informed and make purchase decisions is ultimately leaving brands out of the conversation — and out of the minds of the buying population.

Digital platforms offer great sales reach for brands, but such platforms have vested-interest problems. The sites organize and display their results through algorithms, and it’s these very algorithms that represent a double-edged sword for brands. Brands get a powerful avenue to sell products, but at the cost of greatly reducing their unique quality and value when filtered through algorithms. In this system, brands lose the ability to “speak” directly to customers.

Additionally, a brand runs a greater risk of becoming a “face in the crowd” when it becomes one of dozens of online search results, as opposed to one of only a handful of options on physical store shelves. If brands want to perform well on the algorithms that fuel these digital platforms, they’ll have to pay handsomely for it.

Even if a brand has the top spot on e-commerce marketplaces, the core issue remains: The brand does not control the message. The algorithms — and therefore digital platforms — are still controlling what consumers see.

Mobile millennials

Brands that want to control the message must meet consumers where they are: their smartphones. Pew Research says 72 percent of Americans have a smartphone, and that number is only going to increase as more people rely on them every day for more and more tasks, including shopping. And 34 percent of shoppers believe their phone will become their main purchasing tool, according to PWC.

Millennial shoppers, in particular, are looking for interactive ways to shop. When they’re not shopping online and visiting a brick-and-mortar retail store, they’re using their phone to reference reviews, coupons and price comparisons. In fact, 57 percent of millennial shoppers use their phones or mobile devices to price compare while in-store, according to AIMIA.

To reach this increasingly lucrative demographic, brands will need to create personalized digital experiences through the mobile device that shoppers already carry with them.

Bridging the digital gap

For brands grappling with how to utilize the smartphone connection to consumers, several technologies — like in-store Bluetooth, near field communications (NFC) and augmented reality (AR) — offer the promise of bridging the digital gap between brand and consumer.

NFC, in particular, allows brands to do this through technology already found in smartphones, as most mobile devices are already NFC-capable. With a simple tap of their smartphones, consumers can be taken to personalized content created by the brand, such as videos, coupons and product use information.

Shopping moves at the breakneck pace of always-on mobile devices today, and if brands don’t move now to keep up, they’re going to be lost in the widening gulf forming between them and consumers created by intermediary digital platforms. Only the nimblest and most technology-forward firms will avoid the fate of lost brand identity.

Some opinions expressed in this article may be those of a guest author and not necessarily Marketing Land. Staff authors are listed here.

About The Author

With decades of experience in mobile communications, the Internet of Things and printed electronics, Davor Sutija is experienced and passionate about the scope to which the IoT could extend by incorporating disposable and consumer products. A passionate Internet of Everything (IoE) crusader, Davor is spearheading the effort to connect physical objects to the digital world, through NFC-based printed tags. Davor envisions a world where billions of disposable and consumer products each have a little bit of intelligence — and consumers will be interacting with related products by tapping their smartphones.


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