Thursday, February 3, 2011

Why brands need to be reinvented - Nigel Hollis Milward Brown

What do these five brands have in common: Johnnie WalkerOld SpiceAppleAbercrombie & Fitch andHarley Davidson?

Given the title of this post, the answer should not be too difficult. They were all reinvented and are doing well as a result. So what can we learn from cases like these?
In August last year, I wrote a post exploring what signals that a brand needs to be put on life support.
A simple analysis of brands that died during the recession indicated that what originally may have made them different in a good way, was now out of keeping with people’s needs or mindsets. There are many reasons for a brand finding itself in this situation, and they are often interrelated.
Here are three brief case studies that explore how brands get into trouble, and how they find their way back:
Brands are created with a purpose in mind. But sometimes consumers’ needs move on and leave the brand behind. This is what faced Ocean Spray in 2005. Its target audience was becoming more health conscious, but the juice category was receiving a lot of negative PR on health grounds. Until this point, the brand’s marketing had focused on taste and refreshment, not its health properties.
Luckily for Ocean Spray, cranberries contain vitamin C and a special type of antioxidant; both of which boost the immune system. This allowed Ocean Spray to reinvent what its brand offered consumers. An effective campaign focused on Ocean Spray’s origins and immunity boosting properties, which helped it buck the trend and return to growth.
Harley Davidson faced a rather different and more basic problem in the early 80s. The quality and price point of its bikes was out of line with its Japanese competitors. Faced with bankruptcy in 1985, the company restructured.
Management principles borrowed from the Japanese, and a significant investment in production and retro styling, helped get the brand back on track. Quality matched the price premium the brand needed to support, and rather than competing directly with the Japanese, Harley Davidson played up its differences: the classic look, the sound and more relaxed riding position.
Critical to the brand’s success, however, was the recognition that Harley Davidson was more than the metal. It was a symbol of individualism and freedom. Ten years later, sales had more than quadrupled and profits had increased more than thirty-fold.
Abercrombie & Fitch was founded as a high-end sporting goods store, but failed to recognize that a new generation of outdoor enthusiasts wanted skis, boots and bikes, not high-end hunting and fishing gear.
The company entered Chapter 11 in 1976 and was ultimately acquired by The Limited. The brand was completely reinvented as a teen-focused retailer. While its preppy clothes harked back to the company's outdoor origins, the retail format provided a new experience for young shoppers with trendy music, sexy visuals, and perfumed interiors. With a successful formula established, rapid geographic expansion helped the brand become the mall fixture we know today.
These three examples span a continuum from revitalization to reinvention, but share one common theme: speaking to the zeitgeist of current consumers.
Ocean Spray could not change its product, but it could highlight a different and more contemporary benefit. Harley had to re-engineer its production, but it could also offer an escape from the mundane. Abercrombie & Fitch’s new incarnation was carefully pitched at the borders of acceptability, making it all the more appealing to its teen audience.
One of the most important aspects of managing a brand is to keep a finger on the consumer pulse and to interpret it correctly. Are your customers in synch with what the brand offers? Is a decline in sales the result of a fad or a more substantive trend? Is it simply that people’s budgets are constrained or has their mindset changed? Has innovation superseded what the brand has to offer? It is a delicate balance.
You cannot change strategy every year. It will only confuse people as to what the brand stands for. But leaving a necessary change too late is going to be far more costly.
Can you suggest any other causes of brand decline? What other factors lead to a successful rejuvenation?
Please share your thoughts.

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