Why Brands Love AND Hate Facebook and Google | Mirum India

So, this is how traditional brands and businesses worked earlier.

You create the brand, set up a sales network, choose the perfect location for which you pay a mighty premium, set up a distribution network, figure out an elaborate marketing plan to reach users across the country, and then invest many months and years, building around this ecosystem, to create the brand and the business.

And because it was so hard to do, because it required a lot of time, money, resources, effort, that you had done it, was by itself an entry barrier to someone coming and stealing your thunder away.

That is how large brands and businesses were built earlier.

And then came the Internet. And services like Google, Facebook and others. And suddenly, it seemed like the world had changed.

The world clearly shrunk. Everyone was connected over this network.

You could now create your product / service, do a great job of Search Engine Optimization (SEO) to ensure people discovered it, whenever they searched for the category. With small budgets, you could also use Search Engine Marketing (SEM) and get across to users, a little more strongly. And with social media platforms like Facebook, you could amplify your word-of-mouth, you could generate better referrals, and even engage with your customer base, even if they purchased your product through some intermediary or retail network.

And all this could happen, potentially at fraction of the cost it took, to create the same impact in the traditional world. And all this could happen much quicker. And so it spelt a level playing field for newcomers, a level playing field for brands with smaller budgets.

So, if you were managing brands, you HAD to love this new world. And indeed, the honeymoon lasted for a while too. Before new realities were discovered. Such as the following:  

1. So, you were told that you could build out a large number of fans on Facebook, and then you could reach them forever, without having to pay extra. So, you invested into getting those million fans. And then Facebook said, no, you cannot reach out to them. If you wanted to do so, you will have to pay more. And you thought you could fight this. After all, this seemed like a violation of an agreement. At which point, you finally read the fine print! You could do nothing about this change!  
2. Likewise, you did your SEO efforts and got your site listed on top of the search engine for the desired keywords. And then, Google decided to dance! Changed their algorithm, changed some rules, and your site came crashing down on the search results page. Oops.. you need to start all over!  
3. You also discovered that whenever someone searched and discovered you, they also discovered your competitors at the same time. What is a level playing field for you, is also one for your competitors, including new upstart ones, who could now snatch away the market from you.  
4. And you discover that you have no understanding of what goes on inside the black box! When you were setting up your traditional business, at least you could see the distribution network coming up, you could see the field sales force or the partners you got on board, the stores that you physically set up. Revising meta tags, or link building or putting some java scripts, somehow just does not have that same sense of clarity, and besides that, you cannot understand how making those changes will start giving you more business! There is a sense of insecurity that comes with this lack of understanding.   \
5. Essentially you realize that you have created a significant dependence of your business growth on platforms like Google and Facebook. Platforms that are clearly not yours. Platforms that can change rules any time. Platforms that could even potentially throw you out anytime! In the traditional world, would you allow yourself to take such risks? Basically, you are running your business on a rented premise, not an owned one. And that too, where the landlord has all the powers to change rents at any time, change the terms of the contract, basically change anything, and you cannot do much about it. Unless you are one of those who pays a very high rent (aka an advertiser spending many millions with these platforms), you hardly have a say in the matters. And unfortunately, you cannot easily move out either. Because while you are here, you do make good business, and creating that same opportunity anywhere else, independently, is extremely challenging!  

Sounds like a doomsday story? Well, it is not quite so. At least for most brands and businesses. Yes, some have got badly hurt due to the changes done by these platforms. But most others have managed to dance along with the platforms, adapt and grow.  

Just saying that each time a brand gets a big surge, thanks to these platforms, you love the platforms, and anytime you get a jerk due to one of the many reasons listed above, you absolutely hate it.  

Sanjay Mehta,

Jt. CEO, Mirum