Consumer power vs. brand power. Part 1

2nd June

 

 

Written by Julia Uptmoor

Social media challenges the traditional power relations between consumers and brands 

“The battlefield is a scene of constant chaos. The winner will be the one who controls that chaos, both his own and the enemies.” (Good Reads, 2014) Even though this quote of Napoleon stems from the 18th century and was related to the context of war, the idea of as such seems to be more current than ever when looking at marketers’ perceptions of nowadays’ marketing environment. Until about ten years ago, the relation of brand power and consumer power was quite clear: Marketers influenced consumer’s perceptions of brands by active communication having high brand power. In contrast, consumer power was extremely limited (Chrisodoulides, 2009; Muniz & Schau, 2011). However, with the arrival of the internet technology, the introduction of Web 2.0 and the rise of social media, traditional relations of brand power and consumer power have dramatically changed (Cova & Pace, 2006).

At the beginning of the new era, marketers were highly attracted by low costs and high reach that the internet offered, while they were still able to apply the traditional paradigm of one-way communication to the new medium (Chrisodoulides, 2009). However, they had to recognize that this mass media approach did not fit the ever-changing landscape of the internet environment and started engaging in two-way communication (Chrisodoulides, 2009; Muniz & Schau, 2011). This has led to a drastic rise in consumer power since consumers can not only interact now with other brands but can even form networks with other consumers to influence brand meaning (Antorini, Muniz & Askildsen, 2012; Chrisodoulides, 2009; Cova & Pace, 2006; Muniz & Schau, 2011;). Moreover, consumer power has also augmented due to the possibility to access information about companies and legal issues on call.

The change has led to a chaotic battlefield: A marketing environment in which uncertainty about the relations of brand power and consumer power is present (Barwise & Meehan, 2010).  Some believe that power relations have been reversed entirely, meaning that consumer power is dominating over brands power while some argue that brand power persists (Chrisodoulides, 2009; Cova and Pace, 2006; Fournier & Avery, 2011). How much power do consumers have nowadays? How high is the brand power still? How can a company gain back control over the chaos to become a “winner”? Based on two cases, those questions will be discussed in order to shed light on the new marketing environment.

Analysis of consumer power and brand power in the era of social media

The first case deals with Barilla, the world's leading pasta maker and the second one with Coca Cola, the globally most successful beverage producer. Both examples aim on illustrating the level of consumer power and brand power by addressing the same issue which is still very a very sensitive in most societies: the acceptance of homosexual relationships. The companies are taken as examples as they are globally known brands in the FMCG industry and therefore offer high potential to attract enormous buzz about delicate topics in social media by consumers (Davies, 2013).

Case 1: How consumer power is exercised over the brand Barilla

In the morning of 26 September 2013 Barilla’s Chairman Guide Barilla gave a live interview for the radio Italian channel Radio24, in which he stated that he would never consider portraying gay couples in Barilla’s advertisements since the image of the brand should be connoted with a classical family, meaning parents of unequal genders (Davies, 2013; Màrgari, 2013; Taube, 2013). He even aggravated the statement by recommending consumers who don’t share his attitude to eat pasta of other brands (Taube, 2013).

With those insulting statements he opened up the virtual battlefield for the struggle between brand power and consumer power. It took only a few hours until that criticism started being circulated on the internet by consumers. The criticism in social media was expressed in form of Tweets marked by #boicottabarilla, #barilla and #boycottbarilla, posts on Facebook, blog comments, ironic images and videos (Màrgari, 2013; Davies, 2013). Online newspapers picked up on that and even direct competitors e.g. Bertolli engaged in the social movement attacking Barilla with sarcastic statements while underlining their openness towards minorities (Davies, 2013; Màrgari, 2013).  The buzz that started in Italian social media became a global issue in the entire web within a few hours and dominated the entire internet environment. As a consequence, the brand experienced a huge damage. 

  Image 1: Barilla boycott on Twitter showing consumer power (Twitter, 2013)

 

Image 1: Barilla boycott on Twitter showing consumer power (Twitter, 2013)

Pressured by consumer power, Barilla’s Chairman apologized for his behaviour on Facebook and Twitter even in a video two days after the interview explaining that he wanted to emphasize the importance of women in a family and is willing to learn more about the modern way of family (Màrgari, 2013). Since then, the company has completely changed the course by underlining diversity and by calling U.S. gay activist David Mixner in a new advisory board to get his advice (Taube, 2013). Not enough, Barilla encouraged even consumers to upload videos demonstrating the diverse nature of pasta (Taube, 2013).

Analysis of case 1: How consumer power is exercised over the brand Barilla

The case of Barilla proves the new paradigm of marketing, in which consumer power is dominating over brand power (Cova & Pace, 2006). Precisely, it is shown how the immense progression of new communication and information technology in form of social media has increased consumer power by enabling them to engage with other consumers (Firat & Venkatesh, 1995). Technology has facilitated an exchange of opinions and the creation user-generated content (UGC) (Chrisodoulides, 2009; Muniz & Schau, 2011). As a result, the consumer takes an active role with the power to influence brand meaning and reduce brand power (Chrisodoulides, 2009, Wind, 2008).

Consumers achieved to become a powerful crowd for an anti-brand movement so that it had to be taken seriously by the brand (Chrisodoulides, 2009). Consumer power made it possible to punish Barilla for his inadequate behaviour and not only apologize on Facebook but putting so much pressure on him and directing him to record an entire video explaining his unacceptable behaviour. This can be seen as a “serendipitous hijack” (Cova & Pace, 2006), which means that consumers gain power by controlling a brand’s persona in form of a network. As this model relates to rather fanatic consumers it is hard to predict by the marketers and consumers can gain power quickly. Technology facilitated that quick interaction of consumers and lead to criticism trickling down to the entire web making information available for everyone globally with internet access (Firat & Venkatesh, 1995). This encouraged other stakeholders such as newspapers and competitors to attack the company.

Furthermore, the nature of topic itself evoked a viral explosion. It seems that social issues and the need for ethical behaviour have become important for the consumers of postmodernism (Cova & Pace, 2006; Firat & Venkatesh, 1995). Thanks to the transparency that the web offers, consumers can now access information about corporations for free, therefore have higher bargaining power and instead of being dictated value they create value themselves and publish that via social media (Kucuka, S.U. & Krishnamurthy, 2007). The consumers of Barilla made very clear that they do not share his opinion and do not accept a brand image that excludes minorities such as gay couples. 

To summarize, it was shown that consumer power has significantly increased and that consumers takes over an active role with high control while brand power has diminished since marketers have lower influence on the brand and therefore the brand can be hurt easily. Chrisodoulides (2009) summarizes this with the sharp comment that “the brand manager is no longer a ‘guardian’ of the brand but becomes more of a brand ‘host”. Following him and others, the power asymmetry seems to be reversed and power has been transferred to the consumers. As a result, it is not only a social environment anymore because people interact with each other but also because social issues play a major role.

However, the question remains if brand power has vanished entirely. In order to establish the level of brand power and the implications for managers. 

The second part of this blog post and the bibliography will be published on 5th of June.