Brand in the Land of Bureaucracy
Big, public companies usually suck at brand management. Why? Building brand is the art of saying no -- saying no to near term opportunity. In particular, it is the Faustian choice between volume and brand. Brand is the art of turning down opportunities. It is discretion. The only time this works is when the highest levels of management, to the board of directors, understands this, and understands the sell-out that can occur if near-term opportunities are put before the discipline of brand management.
The case-in-point is selling to Wal-Mart. To marketing types this is nothing new. Public companies, who must perform quarterly, will have top-level management holding direct reports accountable for meeting numbers that satisfy wall street. The issue occurs when there is a shortfall. The group with the shortfall will inevitably look for short-term ways to increase revenue. Sure, they will look pick the one that least damages the brand in the name of volume, but that is a slippery slope for sure.
Big companies should confront this reality and focus on acquisition of brands. Following the pharmaceutical model would be advantageous. Small start-ups build brand equity over the course of several years, then sell-out to the big guys. This happens somewhat, but not with the focus nor to the extent that it should. Smaller players don't have the layers of bureaucracy, any one of which could spoil the delicate discipline necessary for brand positioning over time. Another problem w/ larger companies is the turnover at key areas, which make poor follow-through. I dare say at many companies creating big brands is 1/2 luck.
question: And this I truly don't know the answer to: When launching an upscale brand, it is surely advantageous to launch the upscale merchandise first, position the brand as upscale, then extend ever so cautiously downward. But are there examples of the opposite occurring? Where somebody has launch low, and then gone high? The only way I can think of it is by accident: the brand get so outcast, it becomes cool. Example: Pabst Blue Ribbon Beer. Maybe not exactly an initially high-high end beer, but certainly one that competed on a national stage with such notables as Coors, Miller, and Bud... Here's an article about them:
http://www.insightmag.com/news/2003/08/05/National/Brew-City.Heritage.Coming.To.A.Head-447813.shtmlg
The case-in-point is selling to Wal-Mart. To marketing types this is nothing new. Public companies, who must perform quarterly, will have top-level management holding direct reports accountable for meeting numbers that satisfy wall street. The issue occurs when there is a shortfall. The group with the shortfall will inevitably look for short-term ways to increase revenue. Sure, they will look pick the one that least damages the brand in the name of volume, but that is a slippery slope for sure.
Big companies should confront this reality and focus on acquisition of brands. Following the pharmaceutical model would be advantageous. Small start-ups build brand equity over the course of several years, then sell-out to the big guys. This happens somewhat, but not with the focus nor to the extent that it should. Smaller players don't have the layers of bureaucracy, any one of which could spoil the delicate discipline necessary for brand positioning over time. Another problem w/ larger companies is the turnover at key areas, which make poor follow-through. I dare say at many companies creating big brands is 1/2 luck.
question: And this I truly don't know the answer to: When launching an upscale brand, it is surely advantageous to launch the upscale merchandise first, position the brand as upscale, then extend ever so cautiously downward. But are there examples of the opposite occurring? Where somebody has launch low, and then gone high? The only way I can think of it is by accident: the brand get so outcast, it becomes cool. Example: Pabst Blue Ribbon Beer. Maybe not exactly an initially high-high end beer, but certainly one that competed on a national stage with such notables as Coors, Miller, and Bud... Here's an article about them:
http://www.insightmag.com/news/2003/08/05/National/Brew-City.Heritage.Coming.To.A.Head-447813.shtmlg
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