2.3 Case study
I have added case studies to strengthen the literature study with real world data, experiences and lessons to learn. All seven case studies are based on the most popular branding mistakes among big USA brands. The case studies are taken from the book “Big Brands – Big Trouble: Lessons learned the hard way” from Trout (2001).
I have limited myself to reveal only these seven management casus. I have not the ambition to examine the companies in more dept as described by Trout, nor to update these with the latest company information. The value for me, of studying these casus, is related to the understanding of brand management dynamics. Therefore I have approached the casus from a branding paradigm. My case study involves; Levi Strauss, Miller Brewing, Xerox, Digital Equipment Corporation, General Motors, AT&T, and Firestone.
2.3.1 Levi Strauss - Ignoring competition is bad for your business
Levi Strauss took its leadership position for granted and relied too much on their brand name without managing the brand perceptions, identity and positioning. A severe inside-out focus distracted Levi from the highly competitive markets and opened the door for new labels/brands and swift development of actual competitors. Levi’s brand architecture was not suitable to compete against the established house-of-brands competitors. The time Levi came with their multi brand architecture they had to close a big gap against the established competition. Levi’s new brand strategy and brand positioning could bring them back on top, because individual brands remain strong and healthy.
2.3.2 Miller Brewing - A “Miller” to far.
The Miller Brewing brand architecture as executed over the last decades was not as successful as foreseen by management. Range brand strategy and line extension have brought the Miller in to top 2 of beer brewing industry. The brand concept, brand identity, and brand positioning in the mind of beer consumers was set by Miller. Basically it’s one mindset to the (one) brand which could be beneficial to the range of products. The paradox is hidden in the product range itself, segmentation, product (range) name and positioning within the market. Miller Lite, a light beer, has been the most successful product of Miller.
The success was not for free, cannibalization of Miller’s flagship brand balanced and stabilized Miller’s market share. Apparently, customers where not able to deal with different mindsets for one brand (Miller). Miller’s success dragged a lot of me-too competitors on the low calorie beer market. Miller’s product name “Lite” was to close to “light” and became a generic market/category name instead of a product name (same happened to SPA, Cola, etc). Product range line extensions, from premium price flagship beers to low price light beers, have created a scattered product portfolio which weakened Miller’s image, positioning, and trade relations. Miller became a generic and homogeneous brand.
2.3.3 Xerox - Predicting a future that never came
Xerox deviated heavily from their brand essence, the gap between brand identity and brand image have confused consumers over a long period. By loosing its focus and covering the market with all sorts of technical solutions Xerox tried to be specialist in everything which delivered scattered superb successes. Nonetheless, as to be expected it did not contribute to the core strategy as planned nor did it pay off the massive R&D and marketing investments in product development. Basically Xerox did not exploit what they owned in the mind of their stakeholders due to a lack of brand management and a lack of brand leadership.
2.3.4 Digital Equipment Corporation - From number two to nowhere
Digital Equipment Corporation (DEC) missed the PC market by management inertia and product introductions by strategic brand myopia. DEC management was not willing to reposition and focus on future technology which, surprisingly enough, they already owned. Instead of focusing on new emerging niche market opportunities DEC tried to consolidate what it did not own. Finally DEC was taken over by Compaq, a PC manufacturer.
2.3.5 General Motors (GM) - Forgetting what made them successful
GM’s brand portfolio incorporates 5 mayor brands which leverage the GM’s success. GM lost market focus due to their success, egos grew rapidly and arrogance took over objective market insights. Management took the brand name as main driver for their past success which narrowed GM’s market focus even more. Next to that GM brands product range portfolio started overlapping which leverage internal competition and brand cannibalism. GM believed in their own future success based on brand equity and lost touch with the customers and front line managers. GM management opened the door for new competitors and could not anticipate on their swift strategic actions.
2.3.6 AT&T - From monopoly to mess
AT&T as monopolist had to divest them selves. AT&T starts buying and investing money in non-core business driven by the strategy slogan “what do we want to do”. AT&T lost reality and deviates from its roots of unique and core values. Due to the scattered brand/product portfolio AT&T could not differentiate itself any more in a highly competitive environment. Nonetheless they had the most powerful and distinctive technology of the market place, which was for R&D just common practice and taken for granted. Not only did AT&T lost market focus, they also lost all synergy in creating; visibility of points of differences and driving positive brand associations.
2.3.7 Firestone - Dead brand driving
The Firestone brand suffered heavily after the year 2000 disaster of exploding tires. They had to pay the highest price; money wise and identity wise. They became the brand of “exploding tyres”. Eventually Bridgestone acquired Firestone and kept both brands next to each other. This “house of brand” architecture leverages the “horn” effect where the negative brand associations and identity of Firestone influenced Bridgestone’s. Bridgestone invested a lot of money in marketing campaigns to change the mind of consumers which is proven to be almost impossible. A revision of Bridgestone brand strategy; development of a new focus brand for specific segments, terminate the Firestone brand and establish a stronger unambiguous corporate identity could position Bridgestone as a leader in its marketplace.
2.3.8 Case study reflection
I have addressed that companies, regardless their size, easily get blind folded by successes. As a result of that, management can get overconfident in their abilities and wisdom. I see this as the biggest pitfall in brand management. Key to success is to protect brand roots and develop the brand for future activities without loosing touch of real life market development. Management needs to be careful and consistent in brand identity communication, this lead eventually to brand image and customer perceptions. Brand image belongs to customers, brand perceptions are hard to change once settled in the mind of customers.
Management need to maintain a realistic and objective market view. Market dynamics and market forces need to be monitored over time to safeguard objectivity. Brand strategy must be clear and understood with a strong focus on specific customer segments. For this reason, differentiation is critical to success; dare to choose and start building brand leadership.
Finally, all companies are managed by human beings. I have noticed that strategic brand mistakes are everywhere no matter the size of the company. Nonetheless, the impact on the brand and stakeholders will differ and could take dramatic turns. Where perilous times require perilous actions, management should avoid getting dragged into perilous times due to perilous actions.