BRAND FAILURE
The process of branding was developed to protect products from failure. This
is easy to see if we trace this process back to its 19th-century origins. In the
1880s, companies such as Campbell’s, Heinz and Quaker Oats were growing
ever more concerned about the consumer’s reaction to mass-produced
products. Brand identities were designed not only to help these products
stand out, but also to reassure a public anxious about the whole concept of
factory-produced goods.
By adding a ‘human’ element to the product, branding put the 19thcentury
shoppers’ minds at rest. They may have once placed their trust in
their friendly shopkeeper, but now they could place it in the brands themselves,
and the smiling faces of Uncle Ben or Aunt Jemima which beamed
down from the shop shelves.
The failure of mass-produced items that the factory owners had dreaded
never happened. The brands had saved the day.
Fast-forward to the 21st century and a different picture emerges. Now it
is the brands themselves that are in trouble. They have become a victim of
their own success. If a product fails, it’s the brand that’s at fault.
They may have helped companies such as McDonald’s, Nike, Coca-Cola
and Microsoft build global empires, but brands have also transformed the
process of marketing into one of perception-building. That is to say, image
is now everything. Consumers make buying decisions based around the
perception of the brand rather than the reality of the product. While this
means brands can become more valuable than their physical assets, it also
means they can lose this value overnight. After all, perception is a fragile
thing.
If the brand image becomes tarnished through a media scandal or controversial
incident or even a rumour spread via the Internet, then the company
as a whole can find itself in deep trouble. Yet companies cannot opt out of
this situation. They cannot turn the clock back to an age when branding
4 Brand failures
didn’t matter. And besides, they can grow faster than ever before through the
creation of a strong brand identity.
So branding is no longer simply a way of averting failure. It is everything.
Companies live or die on the strength of their brand.
Yet despite the fact that branding is more important than at any previous
time, companies are still getting it wrong. In fact, they are worse at it than
ever before. Brands are failing every single day and the company executives
are left scratching their heads in bafflement.
The purpose of this book is to look at a wide variety of these brand failures,
and brands which have so far managed to narrowly escape death, in order to
explore the various ways in which companies can get it wrong.
As the examples show, brand failure is not the preserve of one certain type
of business. Global giants such as Coca-Cola and McDonald’s have proved
just as likely to create brand flops as smaller and younger companies with
little marketing experience.
It will also become clear that companies do not learn from each other’s
mistakes. In fact, the opposite seems to happen. Failure is an epidemic. It is
contagious. Brands watch each other and replicate their mistakes. For
instance, when the themed restaurant Planet Hollywood was still struggling
to make a profit, a group of supermodels thought they should follow the
formula with their own Fashion Café.
Companies are starting to suffer from ‘lemming syndrome’. They are so
busy following the competition that they don’t realize when they are heading
towards the cliff-edge. They see rival companies apply their brand name to
new products, so they decide to do the same. They see others dive into new
untested markets, so they do too.
While Coca-Cola and McDonald’s may be able to afford the odd costly
branding mistake, smaller companies cannot. For them, failure can be fatal.
The branding process which was once designed to protect products is now
itself filled with danger. While this danger can never be completely eliminated,
by learning from the bad examples of others it is at least possible to
identify where the main threats lie.
Why brands fail?
A long, long time ago in a galaxy far away, products were responsible for the
fate of a company. When a company noticed that its sales were flagging, it
would come to one conclusion: its product was starting to fail. Now things
have changed. Companies don’t blame the product, they blame the brand.
It isn’t the physical item sitting on the shop shelf at fault, but rather what
that item represents, what it conjures up in the buyer’s mind. This shift in
thinking, from product-blame to brand-blame, is therefore related to the way
buyer behaviour has changed.
‘Today most products are bought, not sold,’ write Al and Laura Ries in The
22 Immutable Laws of Branding. ‘Branding “presells” the product or service
to the user. Branding is simply a more efficient way to sell things.’ Although
this is true, this new focus means that perfectly good products can fail as a
result of bad branding. So while branding raises the rewards, it also heightens
the risks.
Scott Bedbury, Starbucks’ former vice-president of marketing, controversially
admitted that ‘consumers don’t truly believe there’s a huge difference
between products,’ which means brands have to establish ‘emotional ties’
with their customers.
However, emotions aren’t to be messed with. Once a brand has created that
necessary bond, it has to handle it with care. One step out of line and the
customer may not be willing to forgive.
This is ultimately why all brands fail. Something happens to break the
bond between the customer and the brand. This is not always the fault of the
company, as some things really are beyond their immediate control (global
recession, technological advances, international disasters etc). However, more
often than not, when brands struggle or fail it is usually down to a distorted
perception of either the brand, the competition or the market. This altered
view is a result of one of the following seven deadly sins of branding:
- Brand amnesia. For old brands, as for old people, memory becomes an increasing issue. When a brand forgets what it is supposed to stand for, it runs into trouble. The most obvious case of brand amnesia occurs when a venerable, long-standing brand tries to create a radical new identity, such as when Coca-Cola tried to replace its original formula with New Coke.The results were disastrous.
- Brand ego. Brands sometimes develop a tendency for over-estimating their own importance, and their own capability. This is evident when a brand believes it can support a market single-handedly, as Polaroid did with the instant photography market. It is also apparent when a brand enters a new market for which it is clearly ill-suited, such as Harley Davidson trying to sell perfume.
- Brand megalomania. Egotism can lead to megalomania. When this happens, brands want to take over the world by expanding into every product category imaginable. Some, such as Virgin, get away with it. Most lesser brands, however, do not.
- Brand deception. ‘Human kind cannot bear very much reality,’ wrote T S Eliot. Neither can brands. Indeed, some brands see the whole marketing process as an act of covering up the reality of their product. In extreme cases, the trend towards brand fiction can lead to downright lies. For example, in an attempt to promote the film A Knight’s Tale one Sony marketing executive invented a critic, and a suitable quote, to put onto the promotional poster. In an age where markets are increasingly connected, via the Internet and other technologies, consumers can no longer be deceived.
- Brand fatigue. Some companies get bored with their own brands. You can see this happening to products which have been on the shelves for many years, collecting dust. When brand fatigue sets in creativity suffers, and so do sales.
- Brand paranoia. This is the opposite of brand ego and is most likely to occur when a brand faces increased competition. Typical symptoms include: a tendency to file lawsuits against rival companies, a willingness to reinvent the brand every six months, and a longing to imitate competitors.
- Brand irrelevance. When a market radically evolves, the brands associated with it risk becoming irrelevant and obsolete. Brand managers must strive to maintain relevance by staying ahead of the category, as Kodak is trying to do with digital photography.
