Interviews, insight & analysis on digital media & marketing

The risks and rewards of building a digital-only brand in 2021

By Yasmin Borain, Chief Experience Officer at Tribal Worldwide

I’m sure you’ve heard a million times over the past year how the pandemic has accelerated digital adoption.

Soon into the pandemic, brands were facing a dilemma – go digital or go bust. Digital transformation was the difference between prosperity and failure. But with a sea of brands from every corner of all sectors saturating the market, the question was (and still is) no longer how do you achieve digital transformation, but how do you build a successful brand through digital only?

The pandemic shone a light on brands which did not hit the mark with digital literacy. Different demographics were interacting with brands online more than ever before. Shopping, home-schooling, doctor appointments – lifestyles and behaviours across the globe became digital-first. If your brand wasn’t digitally accessible for all your target consumers, you were lagging behind.

This demand for digital services meant all brands had to reassess their digital persona and how they’re seen online. Alongside this, it became very clear that emerging as a new brand meant you had to work harder to gain traction and reach the right audience in an already saturated digital world. In 2021, is digital-only the way for brands to go?

Is digital-only the way to go?

There are of course pros and cons to digital-only brands. A huge trend we saw in 2020 was digital brands collaborating with traditionally non-digital brands to reach a wider audience and explore new territories and services we haven’t seen before. Deliveroo and Uber, two renowned digital-only brands, collaborated with the likes of Aldi, which doesn’t offer a digital delivery service of its own, for online grocery shopping – overcoming the challenge of limited supermarket delivery slots faced at the outset of the pandemic.

Digital can meet a variety of needs which physical brands might find limiting. For example, some brands’ digital experience has arguably better personalisation and flexibility. Found a top you like online? Scroll down and you’ll see a variety of other options you may also like, as well as jeans to go with it. Provide a bit of information about your size and interests and you will see even more matches for you and your lifestyle. Digital brands can collect data that physical stores can’t – and far more of it – which means they can more easily meet the real-time needs of customers through customised tools and tailored experiences.

However, digital personalisation can lead to people not feeling heard. After buying a new mattress, consumers don’t want to have a mattress recommended to them every time they visit that brand’s site and ultimately, shoppers don’t want to feel like they’re being watched by Big Brother. Tracking data may help build customised tools, but this also puts you at huge risk of presenting as a robotic stalker. There is a fine line where personalisation stops being seen as helpful and convenient.

That human and emotional connection is still incredibly important to resonate with consumers. Look at the financial and fintech sector – Monzo took the world by storm when it first arrived, and completely revolutionised banking. But customers are reluctant to put all their money there. When it comes to something as personal as savings and money, people still want the option to speak to a human about their finances – either in a branch or on the phone – especially when something goes wrong.

The nature of the internet has also created a space where markets have become completely overcrowded. Digital-first brands are at risk of drowning in the noise. And if you’re digital-only, you don’t even have a physical presence to counter this. If you can’t cut through the noise online, you’re at risk of failing, or at the very least struggling.

The human touch

The most important element to building a strong, futureproof digital-only brand, is actually the human element.  Even online, many consumers are still looking for an emotional connection with a brand – and a small human touch can be all it takes. 

Although already a giant in its own right, Amazon has recently been experimenting with physical stores. The premise is still very much digital, but opening up a physical space for people to interact with helps build that emotional relationship. And just this week we’ve seen Amazon announce it will be opening up its first hair salon in London.

The luxury sector has adapted well in creating more humanised digital relationships with shoppers through virtual try-on experiences. Gucci launched an AR snapchat lens which meant consumers could virtually try on its shoes, and RayBan created a similar AR experience so shoppers could see if the glasses suited their face shape before buying.

Of course this is not possible, or even necessary, for all digital brands. However, lessons can be learnt from them. While digital-only brands are already a step ahead in adapting to changing consumer behaviours, maintaining a human, emotional approach is the factor that will ultimately make your digital brand a success. Consumers need to feel comfortable, welcomed, and valued, not like they’re just another piece of data for you to capitalise on. Your business model needs to rotate on a better understanding of why your consumer is engaging with your brand.

Ultimately, consumers want to be treated as people – they want human interactions even in a digital world. And if your digital brand can strike the right balance between the human experience and the digital experience, you’ll see it flourish, even post-Covid.