Branding Solutions - Accuprosys

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Seven Deadly Kinds of Branding Failures

• Know branding mistakes before you make them!

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Its established brands do commit suicide or
are killed.

• So many brands meet an untimely death, often on
  an embarrassing note for the companies.

• When the sales of a product are flagging, its
  not the product but the brand that is failing.

Just google epic brand failures of all time and
youll see why.
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Every branding failure gives you something to
learn from.

• In his illuminating book, Brand Failures, Matt
  Haig gathered some really big branding failures
  of the century and categorized them into eight
  types.

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1. Idea Failures

• Sometimes brands fail simply because of a bad
  idea or an improperly thought out/not
  well-researched idea.
• Like Pepsi AM for instance.

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Pepsi found out that there are many consumers who
drank colas for breakfast.

• That gave Pepsi an idea a rather BAD IDEA.

• Without comprehensive market research, Pepsi
  assumed that it has unearthed an unexploited
  consumer base that drank caffeinated cola for
  breakfast instead of coffee.

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What Pepsi didnt know was that although some
consumers drank Pepsi in the morning, there was
no special demand for a breakfast sub-brand.

• Customers simply didnt think they needed it.

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If a consumer doesnt know he has a need, its
hard to offer a solution.
Robert M. McMath Brand expert and writer
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Pepsi learnt it the hard way.
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2. Extension Failures
the addition of a new product to an already
established line of products under the same name
Extension
Often, companies try to leverage the reputation
of their already well established brand name to
sell a different product.
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For instance

• Coca-Colas diet coke

• Ponds toothpaste

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Its not necessary that the success of one
product would guarantee the success of another.

• Learn this from Harley Davidson.

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The powerful motorcycle brand thought that if so
many people loved its motorcycles despite its
flaws, they will also love its perfumes.

• It launched a perfume range that gave it the
  sweet smell of failure!

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The brand failed and the perfumes simply had no
takers.

• Its hard for customers to accept a completely
  different kind of product under an already
  popular brand name.

• Ponds toothpaste is yet another example.

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If you have a powerful perception for one class
of product, it becomes almost impossible to
extend that perception to a different class.
Al Ries Marketing writer
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The sooner businesses realize this, the better!
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3. PR Failures

• While some companies manage such crises
  gracefully, others simply make matters worse.

• It is taken that brands will face at least one
  crisis during their run.
• Companies need to be ready with the right PR
  strategy and the right answers if at all their
  product or brand gets negative media attention.

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Gerber, a German manufacturer of baby food had a
PR debacle in 1986.
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Glass shreds were found in its products and
rather than recalling the products and
apologizing, it chose to stay tightlipped about
it.

• Its lack of public response gave it a bad name.

• By refusing to talk, the company projected the
  image that it had something to hide.

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In these days of active communication and social
media transparency, companies need to take
responsibility for their products and strengthen
their PR. Not doing so will only spell doom not
only for the brand but also the company.
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4. Culture Failures

• In this era of globalization, it isnt necessary
  that what works in one culture will do so in
  another.
• Brands need to cater to the requirements of each
  market they enter.

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Kelloggs is the most consumed cereal brand
across the world.

• The company reached an all-time peak in 1980s in
  the US, with a 40 stake in the ready-to-eat
  market.

• With increasing competition, Kelloggs sought
  expansion beyond its traditional US and European
  markets.

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With increasing competition, Kelloggs sought
expansion beyond its traditional US and European
markets.

• It soon decided that India is a suitable market
  and launched its subbrand Cornflakes with a US
  65 million investment.

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But in India, breakfast cereal was an entirely
new concept.
VS.
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Moreover, the product was pretty expensive for
Indian consumers when compared to homemade
breakfast.

• Unwilling to accept failure, the company launched
  other products tailored to suit indigenous
  tastes.

• It has ever since had a tough ride in India.

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5. People Failures

• Planet Hollywood, a hotel venture, was a unique
  brand with a grand launch.

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It is one of the most famous celebrity backed
ventures with high profile investors
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Soon after its launch, it opened 80 restaurants
around the world and dreamt of having 300
branches by 2003.

• Within a decade of its launch, the brand was a
  failure. What went wrong?

• However, the company went bankrupt in 1999.

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The Companys Faults

• It was expanding too quickly
• It was launching new branches even before the
  already existing ones started making profits
• It didnt advertise its food and was rather
  banking on the celebrity status of its investors
• It didnt tie its theme to its core product and
  simply relied on celebrity

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Other such brand failures include Fashion Café,
Ratners and HearSay.
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6. Rebranding Failures

• British Airways is one of the biggest rebranding
  failures.
• It started an expensive rebranding strategy in
  1996.

• Soon afterwards it announced its cost-saving
  redundancies that contrasted with its costly
  makeover and rebranding.

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It redid the tail-fins of its airlines,
abandoning the Union Jack colors to give it a
more international identity.

• The fact that the British airways didnt look
  British anymore did not go well with customers!
  

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7. Internet and New Technology Failures

• A glitch was discovered in Intels Pentium Chip
  by a mathematics professor.

• This news spread like wildfire but Intel denied
  that its chips had a problem.

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It did not take responsibility for the chips and
refused to replace affected ones.

• Only after IBM declared that it will not use
  Intel chips that Intel agreed to replace the
  chips.

• The issue magnified and the share value of Intel
  dropped by more than 20 points!

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Intels inappropriate response (or the lack of
it) to online criticism marred its online
reputation.
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It is imperative for companies to respond
quickly, acknowledge online criticism, and
monitor critics if they wish to maintain the
reputation of their brand.
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Centre for Innovation and EntrepreneurshipC-4,
IIT-H Foundation, Gachibowli, Hyderabad961840275
1, 9000600247

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