Arthur Wheaton, is the Director of Western NY Labor and Environmental Programs at Cornell University ILR School. He is a Workplace and Industry Education Specialist for the Institute for Industry Studies. His expertise includes industry education and workplace training, high performance work systems, negotiations and conflict resolution, as well as auto and aerospace industrial relations. Prior to joining the ILR faculty in 1999, Art was with the Massachusetts Institute of Technology, where he was project manager for the Labor Aerospace Research Agenda. He has served as executive board member and steward for the American Federation of State, County and Municipal Employees, AFL-CIO in Michigan.
Once hallowed brands that have made their way to the morgue or are sitting dormant. What value do they carry for a marketer of today?Once-loved brands do retain some level of value. Often this value is not in the home market but in international markets. For example, many of the “dormant” brands from the auto industry have been resurrected in other markets. Chinese companies have found some value in bringing former well-known brands to the Chinese market. Volvo, Roewe, Rover, MG and other nameplates were launched or derived from discontinued or struggling brands. The marketing and advertising of these brands is difficult and can be complicated by ownership of the brand name rights. Roewe is the new name for former Rover or MG products purchased by SAIC. The actual value is difficult to calculate but it can be easier to link a new name if there is a distinct heritage to draw from that is more valuable/favorable than its new owners. The purchase of IBM ThinkPads by Lenova turned out to be a very profitable and shrewd decision to leverage the IBM ThinkPad legacy with a new company name. Some brands such as Plymouth or Hummer may have too much bad press or tainted image to resurrect. Nissan has begun to explore reviving the Datsun nameplate in other countries but is unlikely to return to the United States or Japanese markets.
So how can marketers and firms go about the practice of pumping life into such ‘dormant’ (dead) brands? General Motors dedicated billions of dollars to infuse better product at Cadillac. This was only part of the solution. Cadillac needed new marketing, design, and a bold departure from its historical image of a luxury car for the older generation. The angular and muscular design elements and new technological advances were keys to differentiate the old from the new. It was not a quick recovery for Cadillac but GM has successfully revived Cadillac to become a model for Lincoln Motor Co. to follow.
Oldsmobile, Plymouth, Saturn, Saab and a host of other ‘huge’ brands in the auto market met untimely death. Do you think so?
Not really. Auto companies kill brands to conserve precious resources. Marketing a large brand portfolio requires significant monetary and human resources to survive. General Motors, Ford Motor Company and Chrysler all killed off underperforming brands (Oldsmobile, Saturn, Hummer, Saab, Mercury, Plymouth). Each brand has a unique story but the general consensus is that the amount of resources necessary to improve the brand are not justifiable or possible. For Pontiac, Hummer, Saturn, and Saab the decision was forced upon General Motors in order to receive funding. Oldsmobile, the oldest of GM’s brands, was killed off prior to the bankruptcy. For General Motors there were too many brands with too little differentiation or justification given falling sales. The marketing, sales and dealership costs are difficult to justify in declining and competing brands. General Motors killed off Oldsmobile in hopes those buyers would transfer to the other GM brands. That for the most part did not happen.
Let’s talk about reviving brands. There are some great examples like Converse, Saturn, Lenovo, Cadillac, Old Spice that serve inspiration to marketers around the world. On the other hand, there are other ongoing efforts like West River Brands is working hard to get Brim Coffee back on its foot. What do you make of such turnaround tales? Trying to revive some dead brands are not worth the expense and may not be possible. Let’s take an example from the automobile circuit. It would be difficult to revive brand Hummer. The changes in our attitudes about climate change and the militaristic image of Hummer would be difficult to market. Next, retail. It is too soon to know if the damage done to JC Penney is reversible. The turmoil caused by the failed CEO and proposed changes to store layout and design were a disaster. It remains to be seen if the old CEO can get JC Penney back on a profitable course after its public apology to consumers.
And what’s the next best strategy to revive a dead brand if in-house or outsourced marketers cannot do the job?
Sellouts. They are a better option in several cases. I think the Hostess ‘Twinkie’ brand will be better served with new ownership and investment. Nike had the resources necessary to revive Converse and was able to leverage the rich history of Converse in the sporting shoe market. The “Throwback”, nostalgia, or heritage market for sporting equipment has been a profitable niche. Tapping into the good old days with improved product and strong marketing can be a rewarding effort.
Some brands that you think stand in danger of getting wiped out in near future, like a Kodak?
Actually we have a list. JC Penney, Gap, and Dodge are on that list. I would agree with your assessment of Kodak. Despite the rich history of innovation for Kodak it will be difficult to bring it back.
Final question that we asked experts on this topic: Are 800-pound gorilla brands too big to fail? Some laziness should be allowed.
I do not think any brand can afford to be complacent. Even Coca-Cola has needed to differentiate its product portfolio to retain market share. The addition of water, juice, and energy brands were required to keep Coca-Cola alive and well. Standing still or getting lazy is not an option for long term survival – not for Coke, not for Apple.
