Commentary

8 Guaranteed Ways To Kill Your Brand

Throughout the recession, many marketers have relied on so-called "recession-survival" lessons to drive their strategies. Unfortunately, these aren't always lessons as much as they are myths. We thought we would help dispel some of them and share a few tips to spur positive momentum.

Myth #1 - Follow the leader

Growing and innovating by mimicking industry leaders is a bad practice in a blossoming economy, and even more dangerous in a recession. Recessions (like all moments of crisis) are great opportunities for challengers to gain a leadership position if they rethink their category and offer a clear market alternative. FedEx managed to upset the unchallenged leadership of rival UPS when, in 1977, it benefited from a strike at UPS and the bankruptcy of REA Express.

Myth #2 - Better safe than sorry

When recessions hit, many companies' first reaction is to focus on the short term by cutting long-term cost such as innovation and brand building. History demonstrates that this is a big mistake. In the 1974-75 recession, Ford cut marketing spend by 14%. Chevrolet increased spending, particularly for its fuel-saving economy models. Chevrolet's market share rose by two percentage points, while Ford lost share. It took years to regain its previous position.

Myth #3 - Recessions are bad times to introduce new brands

Consumers have emerging needs during recessions that new brands can address. During a six-year recession in the 19th century, the Denver area was growing as rail lines opened to the West. The U.S. desperately needed a drink. A 26-year-old Prussian immigrant named Adolph Coors opened what he called the Golden Brewery there. It eventually became one of the largest brewers in the world.

Myth #4 - National brands are dead

Private labels have been gaining ground. National brands are not doing a great job of defending their perceived value whenever they stop innovating or confuse consumers with unclear or overlapping offerings. To hold consumers now, national brands need to give consumers new reasons to continue to engage with them.

Myth #5 - Value = price

Value is not just about a price tag. It is about perceived value for money. Investing in innovation, new formats and sizes will do a better job of proving perceived value than playing a pricing war.

Apple has managed to sustain the success of the "i" story through frequent product introductions, short product life cycles and quick pricing shifts. So don't force your consumers to trade down for a commoditized offering. Give them a reason to trade up to their perceived value at the same price.

Myth #6 - More SKUs = more market share

Launching new SKUs to buy shelf space or "give more choices to consumers" will never buy you market share. Retailers are in the process of fundamentally rethinking their supply strategies by relying on a smaller number of brands (and SKUs) and a higher degree of customization to cater to fickle consumers. So unless you own your distribution channel, forget about SKU proliferation and work on portfolio rationalization. This will help your innovation to shine and your retailers and consumers will probably say "thank you."

Myth #7 - Consumers are marketers

Many marketers still believe that consumers will tell them what they really want. Unfortunately, no matter how many hours you spend behind a two-way mirror, consumers can react to the next big thing, but they will not create if for you. When entire consumer mindsets are being redefined (from "greed" to "good", and from "me" to "we"), what marketers should do is analyze what drives macro societal shifts, identify if and how they are likely to impact their consumers' attitudes and leverage current technology to address them.

Myth #8 - The answers lie in research

Building an effective research plan is a matter of finding the proper balance between upfront and downstream research. Too much of the former can confuse strategic direction, and too much of the latter can delay action. As marketers become increasingly risk-averse, the balance often tips from the former to the latter. This is counterproductive, creating paralysis. Remember that answers don't always lie in research, and definitely not in one kind of research ...

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4 comments about "8 Guaranteed Ways To Kill Your Brand ".
  1. Jan Zlotnick from the zlotnick group , October 27, 2009 at 2:03 p.m.

    Good mythbusting, Eric. My takeaway here is Don't Stop. Or, maybe as JWalker would like us to think, Keep Walking. The thing is, in times of crisis, people tend to tuck themselves into a fetal crunch and hold tight until it's over. Hard to do much of anything in that position of physical and mental immobility. As you point out, Eric, the ones who tend to succeed are those who know, by some counterintuitive leadership instinct, that this whole customer-commerce thing they do, is simply about knowing what their customers want and will want...and they know that ain't gonna happen by stopping the relationship. A relationship nurtured and cultivated through, well, every little thing, but at its core, through marketing, the nerve center a brand that sends out the unified message....to everyone inside and out: from R&D to product to sales to communications, et al. The greatest myth may be When Consumers Stop Spending They Stop Feeling, Listening, and Watching Your Brand.
    - Jan Zlotnick http://www.janzlotnick.com

  2. Rodney Brooks from ToTouch One, Inc , October 27, 2009 at 2:33 p.m.

    Great article about what not to do. A recession is the best time to innovate, revitalize, reinvent, rethink and any other "re's" you can think of. Over the next 5 to 10 years, I see some of the best new products being introduced and we will all be better for it.

  3. Kevin Horne from Lairig Marketing , October 27, 2009 at 3:58 p.m.

    "History demonstrates that this is a big mistake. In the 1974-75 recession..."

    oh, brother. make it stop. please.

  4. Mark allen Roberts from Out of the Box Solutions, LLC , October 28, 2009 at 11:22 p.m.

    I particularly like Myth #1 and follow the leader...
    This also includes wrongfully following an internal leader in your company or as I call them in my post; Hippos..the highest paid person in the room. (Who probably has not spoken to a real customer in years?

    Mark Allen Roberts
    www.nosmokeandmirrors.com