PRODUCT & BRAND FAILURE

PGDM 2009-11 DBS

PROTECT YOUR BRAND FROM BECOMING FAILURE«.

How?

BY UNDERSTANDING:
1 Why a brand fails ? ´ 2 How you can prevent this ?
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BRAND
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Here is the famous advertising copywriter and ad agency founder David Ogilvy's definition of a brand: The intangible sum of a product's attributes: its name, packaging, and price, its history, its reputation, and the way it's advertised.

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BRAND
A brand is not just a logo. ´ A brand is not just an identity. ´ A brand is not just a product.
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So what exactly is a brand?

A BRAND IS A PERSON·S GUT FEELING ABOUTA PRODUCT, SERVICE, OR ORGANIZATION.

INDIVIDUALS DEFINE BRANDS, NOT COMPANIES, MARKETS, OR PUBLIC.

ŠIt·s

not what you say it is

ŠIt·s

what they say it is.

WHY BRANDING IS SO IMPORTANT?
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People have many choices and less time. Most products have same quality and features. Buying choices are based on trust.

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Product and brand failures occur on an ongoing basis at varying degrees within most productbased organizations. ´ The primary goal is to learn from product and brand failures so that future product development, design, strategy and implementation will be more successful.
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The benefits of studying failures Gaining a better understanding of product failures is important to help prevent future failures. Studying the history of product failures may generate some insight into the reason for those failures and create a list of factors that may increase the opportunity for success.

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Studying product failures allows those in the planning and implementation process to learn from the mistakes of other product and brand failures. Each product failure can be investigated from the perspective of what, if anything, might have been done differently to produce and market a successful product rather than one that failed.

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Defining product and brand failures Š A product is a failure when its presence in the market leads to:
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The withdrawal of the product from the market for any reason The inability of a product to realize the required market share to sustain its presence in the market The inability of a product to achieve the anticipated life cycle as defined by the organization due to any reason The ultimate failure of a product to achieve profitability.

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EXAMPLES OF PRODUCT FAILURES
Computer & IT industry ²Apple·s Lisa, Napster ´ Automotive and transportation- Fiat Uno, Skybus, Concorde³supersonic airliner ´ Sports & Entertainment ²ICL, Readers Digest ´ Food and Beverage ²Cadbury Picnic, Blue Pepsi, New Coke
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Failures are not necessarily the result of substandard engineering, design or marketing. ´ Based on critic·s definitions, there are hundreds of ´badµ movies that have reached ´cult statusµ and financial success while many ´goodµ movies have been box office bombs. ´ Other premier products fail because of competitive actions.
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Using these potential causes of a product or brand failure may help to avoid committing those same errors. Learning from these ´lessonsµ can be beneficial to avoid some of these pitfalls.

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Common reasons for product failures High level executive push of an idea that does not fit the targeted market. Overestimated market size. Ineffective promotion, including packaging message, which may have used misleading or confusing marketing message about the product, its features, or its use.

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Incorrectly positioned product. Not understanding the target market segment and the branding process that would provide the most value for that segment. Incorrectly priced³too high and too low. Excessive research and/or product development costs. Underestimating or not correctly understanding competitive activity or retaliatory response. Poor timing of distribution.

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Misleading market research that did not accurately reflect the actual consumer·s behavior for the targeted segment. Conducted marketing research and ignored those findings. Key channel partners were not involved, informed, or both. Lower than anticipated margins.

OR
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Something happens to break the bond between the customer and the brand. when brands struggle or fail it is usually down to a distorted perception of either the brand, the competition or the market.

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This altered view is a result of one of the following six deadly sins of branding:

DEADLY SINS OF BRANDING
Brand memory loss Š For old brands, as for old people, memory becomes an increasing issue. Š When a brand forgets what it is supposed to stand for, it runs into trouble. Š The most obvious case brand memory loss occurs when a venerable, long-standing brand tries to create a radical new identity, such as when Coca-Cola tried to replace its original formula with New Coke.

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The results were disastrous.

DEADLY SINS OF BRANDING
Brand egotism. Š Brands sometimes develop a tendency for overestimating their own importance, and their own capability. Š This is evident when a brand believes it can support a market single-handedly, as Polaroid did with the instant photography market. Š It is also apparent when a brand enters a new market for which it is clearly ill-suited, such as Harley Davidson trying to sell perfume.

DEADLY SINS OF BRANDING
Brand deception. ´ ¶Human kind cannot bear very much reality,· wrote T S Eliot. ´ Neither can brands. Indeed, some brands see the whole marketing process as an act of covering up the reality of their product. In extreme cases, the trend towards brand fiction can lead to downright lies. In an age where markets are increasingly connected, via the Internet and other technologies, consumers can no longer be deceived.

DEADLY SINS OF BRANDING
Brand fatigue. ´ Some companies get bored with their own brands. ´ You can see this happening to products which have been on the shelves for many years, collecting dust. When brand fatigue sets in creativity suffers, and so do sales. ´ Bata, HM Ambassador is a clear example

DEADLY SINS OF BRANDING
Brand paranoia. ´ This is the opposite of brand ego and is most likely to occur when a brand faces increased competition. Typical symptoms include:
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tendency to file lawsuits against rival companies, « a willingness to reinvent the brand every six months, « and a longing to imitate competitors.

DEADLY SINS OF BRANDING
Brand irrelevance. ´ When a market radically evolves, the brands associated with it risk becoming irrelevant and obsolete. ´ Brand managers must strive to maintain relevance by staying ahead of the category, as Kodak is trying to do with digital photography. ´ One more reason is gap between creativity and strategy
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Strategic thinkers are analytical, logical, and numerical.

Creative thinkers are intuitive ,emotional, visual .

Does the left brain know what the right brain is doing?

When both sides work together you can build a charismatic brand.

Any brand can become charismatic

FOUR DISCIPLINES OF CHARISMATIC BRAND-BUILDING

DISCIPLINE 1:

DIFFERENTIATE

‡WE·RE HARDWIRED TO NOTICE ONLY WHAT·S DIFFERENT

FOUR DISCIPLINES OF CHARISMATIC BRAND-BUILDING

DISCIPLINE 2:

COLLABORATE
Because the mathematics of collaborations is nothing less than magic

FOUR DISCIPLINES OF CHARISMATIC BRAND-BUILDING

DISCIPLINE 3:

INNOVATE

TOO PREDICTABLE = NO SURPRISE NO SURPRISE = NOTHING NEW NOTHING NEW = NO VALUE

REASON THE BEATLES WERE WILDLY SUCCESSFUL IS BECAUSE ³THEY NEVER DID THE SAME THING TWICE´

FOUR DISCIPLINES OF CHARISMATIC BRAND-BUILDING

DISCIPLINE 4:

CULTIVATE

Business is a process not an entity Brands like people Influence character of a brand

If a brand swims like a dog and looks like a duck, people will distrust it.

CULTIVATION

DIFFRENTIATION

INNOVATION

COLLABORATON

BY MASTERING THE FOUR DISCIPLINES OF BRANDING, THE COMPANY CREATES A CIRCLE

WITH EVERY TURN AROUND THE CIRCLE, THE VALUE OF THE BRAND SPIRALS HIGHER.

& THUS YOU BUILD

A sustainable competitive advantage.

EXCERCISE
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Find out product/brand failures in the following categories: Computer & IT industry Automotive and transportation Sports & Entertainment Food and Beverage Electronics & FMCD FMCG Pharmaceuticals Retail Telecom Give your suggestions how they could have been saved ?

THANK YOU