Br@nd-new game: Co's creating online communities to connect with consumers

Today I wanted to share something really interesting with you all.  As Social networking is redefining business these days, more and more brands are creating their online communities and people are associating with it for many reasons, but the important thing here is that with no investment brands are getting increasing number of sales and increasing number of recommendations from others, which is helping a brand or a products cause in a great way.  To know more read the article


Buoyed by their successful Tweets and YouTube promos, brands such as Canon, LG, Samsung and Adidas are now busy creating online consumer communities. Marketers feel that besides increasing brand salience, online communities can emerge as a platform for cross-selling products, thanks to the ever-increasing relevance of the internet as a medium to reach out to consumers.

“The internet is emerging as a potential media for marketers to interact with consumers rather than just communicate with them. Online consumer communities provide an ideal platform,” says L K Gupta, chief marketing officer at LG Electronics India, the country’s largest consumer electronics firm.

LG will soon come up with an online community that will be used “to receive consumer feedback and directly talk to them and thereby increase consumer bonding with the LG brand”. Others such as Sony PlayStation, Tata Teleservices, Philips, Samsung Mobile, Canon and Adidas too believe that the internet lends itself as a big medium for brands to connect faster with consumers than traditional media.

Tata Teleservices is using online communities to track consumer behaviour for its three brands — Tata Indicom, Photon and Tata Docomo. “In a category like telecom, where tariffs are changing everyday, it helps us to hear the inherent voice of consumers,” says Lloyd Mathias, the telco’s CMO.

Canon and Samsung Mobile, which were among the earliest to roll out online consumer communities in India, claim huge dividends.

Canon has logged in 80,000 members in its Canon Edge community. “Since a lot of consumers participating in our community are interested in serious photography, this translated into nearly 100% growth in the digital SLR camera business,” says Alok Bharadwaj, senior VP at Canon India. “Next month, we will launch an online photo gallery that will provide further thrust.”

While money spent on online promotion is still less than 5% of the overall marketing budget for most brands in India, brands like LG and Canon are increasing their online investments 50-100% every year. This is because the return on marketing investment on the internet is high as its cost is minimal and the reach measurable. But the companies are not betting big on online sales. Canon manages to sell some ten cameras every month online, but average monthly revenue of Rs 1 lakh is nothing great.

“Consumers may check out the models on the internet, but they still prefer to touch and feel the products and see demonstration before buying them,” says LG’s Gupta.

However, in digital categories such as gaming and software, companies are looking at online sales. Sony Computer Entertainment, for example, plans to replicate its hugely successful online store in India along with online community, according to its country manager in India Atindriya Bose.

Similarly, Samsung Mobile, which has more than three million users in India in its online community Samsung Fun Club, plans to use it as a platform to distribute and sell mobile phone applications.

“We have just launched applications for Samsung phones through the Fun Club, which will be expanded into areas like maps, instant messaging, sports and news,” says Ranjit Yadav, director (mobile & IT) at Samsung India. European electronics firm Philips is planning to start online communities for its B2B business in healthcare and lighting. “We are already running a couple of pilots targeting doctors, radiologist and architects,” says Vivek Sharma, CMO of Philips India.

Marketers say the internet is a great enabler for building brands in the tech space and for products that target the youth.