Content, community and commerce are essential for digital brands – but to reach the top of the class, even more is needed.
Where traditional marketing was all about the four Ps – product, price, place and promotion – for modern digital brands, it’s all about the Cs. Depending on who you read, there could be as many as five, seven or even ten Cs – but the core consensus seems to be around three critical dimensions. These are content, community and commerce.
Great content is key to attracting and engaging your audience. Many businesses know a social presence is important but don’t truly understand social media’s function, so they end up hiring young and inexperienced social media managers. Lucas London, co-founder of the digital home décor brand Lick, thinks this is a huge mistake. Social media is “the shop window of your product and your brand”, he explains. “Make sure you have high quality team members that are running those campaigns. Don’t leave it to the intern!”
Building a community, rather than just winning new customers, is another mantra for many digital brands. Where some brands might be focused on user numbers, growth or turnover, Etsy co-founder Rob Kalin regards “real conversations” as the most important performance indicator. Kalin wanted sellers to talk to buyers about what they make and how they do it – about materials, the crafting process, the story behind the goods. Other digital brands that overtly position themselves as communities include Google, Wikipedia and Zwift.
The third core C is commerce. The basic tenet is simple: does your idea and the business model you have developed have the potential to make money? The world of digital brands is full of companies that have attracted huge amounts of investment, but failed to make a profit. Some seem to perform well, with huge numbers of followers and good sales, but still don’t make money. These are the brands that the industry doesn’t like talking about.
Jeffrey Lee Funk and Gary Smith have created a list of 15 start-ups with $3 billion or more in cumulative losses. Their table is topped by Uber and WeWork, with losses of $25.2 billion and $21.9 billion respectively. Only one of the companies examined has ever had a profitable quarter – Airbnb chalked up a $378 million profit on $2.1 billion revenue in the second quarter of 2022. The others have recorded losses that exceed 10% of revenue, with most exceeding 30%. As Funk and Smith point out, “Any hopeful arguments that profitability is just around the corner ring hollow when every company is at least nine years old and two are more than 20 years old.”
The three Cs are evidently very important to building successful digital brands. But, as I work on a new book on 75 of the world’s most famous digital brands, my analysis is that the successful ones don’t stop there – they go C+. I would add at least a further three essentials. First is a great idea. This needn’t be something entirely new: often, the idea is a way to make an existing process simpler, quicker or cheaper – as with Amazon, Uber and Airbnb. What people want is a smooth, seamless experience.
The last mile is crucial for many digital brands; efficient, on-time and fast delivery can make or break a business
Second is great delivery. The last mile is crucial for many digital brands; efficient, on-time and increasingly fast delivery can make or break a business. The third essential is the right partner. Whether this is a friend, someone who becomes a business partner or the partnerships you need to develop and deliver your idea, finding the right partner increases the likelihood of any new brand succeeding.
Want to build an A+ brand in the 2020s? You’ll need the three Cs – and more.
Giles Lury is a senior director at brand consultancy The Value Engineers.