• Brand Surgery – excerpts from my Marketing Magazine article

    by  • February 5, 2011 • Branding, Leadership, Marketing, Strategy

    When I was a young product manager back in the ’70s, the only people I could talk to about brands were my colleagues in the marketing department and the advertising agency. Now my accountant, my lawyer, my portfolio manager and even my neighbour talk to me about brands. It’s a subject that I’ve never tired of, but I must admit to some frustration in seeing how brands have been managed over the years. Ostensibly, consumer brands are resurrecting their past luster, but in my view their health remains tenuous.

    There may be improved stock market confidence in some of the companies that produce the world’s best-known brands, but a fundamental flaw exists in the management process that is supposed to renew brand health.

    The blemish is the abdication of strategic attention by the organization’s most senior marketing executives to the enhancement of brand equity. These executives and their CEOs have been so preoccupied with the management mania of the day (years back it was TQM, then right-sizing and now Internet solutions) that their eye has been off the heartbeat of the consumer goods business. And it is unlikely that they will now suddenly redirect attention to the brand-building cause. They talk a good line about “brand value” and the importance of brands to a company, but it is often lip service. The role has been relegated to middle managers who are brand custodians, not leaders in innovation. Through no fault of their own, they either lack the experience, the clout or the motivation to drive innovation into the brands they manage.
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    Indeed, a case can be made where specific restructuring is necessary to bring companies to the new economic reality. But why does brand building have to take a back seat during this era of corporate change? With few exceptions, there is little evidence of value-adding to North America’s most famous brands. I see evidence in niche and specialty markets; I suspect senior people in smaller companies spearhead inventions.
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    A vast number of famous brand names need brand surgery. But before marketers embark on the operation, they must be sure the patient is in the hands of a capable surgeon. Reparatory initiatives do not mean spending more money on advertising and promotion; this is not the prescription for the ailment that requires surgery. The brand surgery philosophy is one of treating products as patients who are no longer thriving, more likely dying from ill health. Many brands fall under this diagnosis; they are the patients that must be nursed back to health.
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    Is it any wonder private labels exploit the weaknesses of the neglected brand-names? Lower costs can offset store-brand gains when the savings are passed on to consumers. But in the long term, cost-cutting does not build brand equity. CEOs must recognize that their own personal attention holds the key to the continued earnings stream. In most companies, the cost savings realized from downsizing has already expired. So if not a concerted brand- building priority, what is the next management mania for profitability gains?
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    Companies need the direct and passionate involvement of senior management in product and brand innovation. When ingenuity is achieved, marketers will be motivated to increase their communication effort in order to share the news with their target markets. This is when the “spend more on advertising” does pay off–when there is something compelling and tangible to talk about. It’s only at this stage that today’s customers are prepared to listen.
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    About

    Formerlife: Jacobs Suchard CEO (Kraft, Nabob), Strategy Consultant. Afterlife: Palgrave Macmillan Author, Business Blogger, Wannabe Novelist

    One Response to Brand Surgery – excerpts from my Marketing Magazine article

    1. Sarah Allen
      February 9, 2011 at 6:09 pm

      >This is fantastic advice. Not something one typically thinks about, especially me. Thanks for this.

      Sarah Allen
      (my creative writing blog)