Part 3 of 3-part series.
Early this year, The Limited shut down its 250 clothing stores and not long after that the women’s apparel chain announced it was filing for bankruptcy protection.
Just like that, a brand that had been a mainstay of shopping malls across America disappeared from the retail front.
What happened to force the company’s hand? Several factors came into play, including an inability to compete with “fast fashion” stores that rush the latest fashions into consumers’ hands, as well as the chain’s sale several years ago to a private equity firm that cut costs but couldn’t find a buyer. However, analysts also suggested that, like many retailers, The Limited failed to keep up with dramatic changes in shopping habits and quick-changing fashion sensibilities, making it less relevant to its target consumers.
While it’s not unusual for brands to head down the path to irrelevancy, it’s also not inevitable. A brand can innovate itself out of a death spiral. Just as an example, IBM may have lost its relevance in computers and laptops, but it saved itself by focusing on servers, information, and Cloud computing.
Some people insist that all brands eventually will go through a natural life cycle from birth to death, but he disagrees with that view.
It’s possible for brands to live forever, but they have to be properly managed. Too often brands get into trouble due to the self-inflicted actions of their owners.
There are probably a dozen identifiable ways businesses can make a mess of their brands. Here are 4:
1. The loss of relevance.
Staying relevant means always staying aware of changes to the landscape, the customers, the competitive brands, and your brand. Understanding what your audience needs and how they obtain their products and services is the way to remain relevant.
2. The lack of a coherent plan to win.
Having a coherent strategy that aligns employees and outside partners accomplishes a lot on the way to positive performance. But the plan needs the clear, consistent, visual, and verbal support of leadership. It also must contain the vision for the brand and the plan to achieve this vision. It’s a top-down strategy. Without a clear and vibrant plan to win, a brand is directionless.
3. The lack of a balanced brand-business scorecard.
A brand-business scorecard allows leaders to view the critical indicators necessary to create growth that is both profitable and enduring, rather than one or the other. Light says such a scorecard reinforces the importance of producing a proper balance between both business and brand results. Using measurable milestones — such as sales, profits, price and promotion — it evaluates whether the brand leadership is doing the right things in the right way.
4. The disregard for the changing world.
Technology changes, demographics change and so do plenty of other factors that can affect a brand. Although it’s impossible to predict the future, it is absolutely necessary for business leaders to keep their eyes, ears, mind, and heart open to what may be possible and to what is actually happening around them.
Some brands that experience trouble are very successful in pulling out of the downward spiral. But the best way to not have to revitalize a brand is to avoid becoming a troubled brand in the first place.
About the Author: Larry Light, a global brand revitalization expert, is co-author with Joan Kiddon of Six Rules for Brand Revitalization. He also is the CEO of Arcature (www.arcature.com), a marketing consulting company. Prior to consulting, Light worked on the advertising agency side as a senior executive at both BBDO and CEO of the International Division at Ted Bates Advertising. He was global Chief Marketing Officer of McDonald’s from 2002-2005, and from 2010 to 2014, he was Chief Brands Officer of the global hotels group IHG. For more information, please email Miguel Casellas-Gil at firstname.lastname@example.org.