Product and Brand Failures: A Marketing Perspective

by Tim Berry Share Overview Product and brand failures occur on an ongoing basis to varying degrees within most product-based organizations. This is the negative aspect of the development and marketing process. In most cases, this failure rate syndrome ends up being a numbers game. There must be some ratio of successful products to each one that ends up being a failure. When this does not happen, the organization is likely to fail, or at least experience financial difficulties that prohibit it from meeting profitability objectives. The primary goal is to learn from product and brand failures so that future product development, design, strategy and implementation will be more successful. 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. The ability to identify key signs in the product development process can be critical. If the product should make it this far, assessing risk before the product is marketed can save an organizations budget, and avoid the intangible costs of exposing their failure to the market. Defining product and brand failures A product is a failure when its presence in the market leads to:

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; or, The ultimate failure of a product to achieve profitability.

Failures are not necessarily the result of substandard engineering, design or marketing. Based on critics definitions, there are hundreds of bad movies that have reached cult status and financial success while many good movies have been box office bombs. Other premier products fail because of competitive actions. Sonys Beta format was a clearly superior product to VHS, but their decision to not enable the format to be standardized negatively impacted distribution and availability, which resulted in a product failure. The Tucker was a superior vehicle compared to what was on the market at the time. This failure was due to General Motors burying the fledging

organization in the courts to eliminate a future competitor with a well designed product posing a potential threat to their market share. Apple has experienced a series of product failures, with consistent repetition as they continue to fight for market share. Product failures are not necessarily financial failures, although bankruptcy may be the final result. Many financially successful products were later found to pose health and safety risks. These products were financial and market share successes:

Asbestos-based building materials now recognized as a carcinogenicInsulation, floor tile and popcorn ceiling materials produced by a number of manufacturers. Baby formula that provided insufficient nutrients for infants resulting in retardationNestles. The diet medication cocktail of Pondimin and Redux called Fen Phen that resulted in heart value complicationsAmerican Home Products (http://www.settlementdietdrugs.com/).

What successful products may be next? Frequent and high dosages of Advil are suspected to correlate with liver damage. Extended use of electric blankets are suspected by some to increase the chance of cancer. The over-the-counter availability and high use of Sudafed is feared by some physicians and is currently under review by the U.S. Food and Drug Administration. Product failures and the product life cycle Most products experience some form of the product life cycle where they create that familiaror a variantform of the product life cycle based on time and sales volume or revenue. Most products experience the recognized life cycle stages including: 1. 2. 3. 4. Introduction Growth Maturity (or saturation) Decline

In some cases, product categories seem to be continuously in demand, while other products never find their niche. These products lack the recognized product life cycle curve. Brandings Periodic Table 3 Important Elements of a Brand Strategy

5 Dimensions of Brand Identity October 5th, 2005 No Comments 1,566 views

Brand identity is composed of various shares that trigger particular responses in consumers in addition to filling the afore-mentioned functions. These shares build on one

another; the more shares a brand has, the stronger and more positive the relationship with consumers.

Mind
At the very lowest level, mind share must be created in the consumer consciousness (cognitive level). This means that, as a complex perceptual and conceptual construct, the brand evokes an internal neural representation in the minds of consumers, leaving behind certain brand impressions.

Heart
This refers to the emotional relationship a consumer should develop with a brand. Heart share is less a matter of a products functional utility and more a matter of its symbolic attributes. The buyer of a Ferrari, for instance, will not develop an affection for the car based purely on functional attributes, but rather as a result of the values associated with the brand and the brand environment it operates in.

Buying intentions
Brand identity must trigger a buying intention share in consumers. After all, despite the importance of a brands mind and heart share, it only makes sense for a supplier to invest in brand identity if consumers will also want to buy the brand.

Self
Brand identity contributes to self share, which means that the brand functions as a manifestation of the self, a tangible expression of self-image within the social environment. In this context, brands serve self-expression and self-design purposes, differentiating the individual within the social group. Brands can easily serve similar ends in the realm of business-to-business, where they bolster self-image in terms of a company and its functions.

Legend
Here, the brand shares in the existential search for meaning conducted by a consumer in a world enlightened to the point of meaning-lessness and takes on a virtually religious character. This aspect sheds light on the cultural-sociological proposition that brand management is worshiping the customer. Brands allow consumers to achieve social position or status, to partake of cultural expression, to create mythology and shape meaning, and as a result, to weave themselves into the social and metaphysical fabric of the world. In this context, a loyal customer is a member of a community and an individual loyal to that community not just a customer who makes repeat purchases. A brand is a tool for building a sense of community and belonging, for building the community itself.

Brand Extension

Brand Extension - Meaning, Advantages and Disadvantages

Brand Extension is the use of an established brand name in new product categories. This new category to which the brand is extended can be related or unrelated to the existing product categories. A renowned/successful brand helps an organization to launch products in new categories more easily. For instance, Nikes brand core product is shoes. But it is now extended to sunglasses, soccer balls, basketballs, and golf equipments. An existing brand that gives rise to a brand extension is referred to as parent brand. If the customers of the new business have values and aspirations synchronizing/matching those of the core business, and if these values and aspirations are embodied in the brand, it is likely to be accepted by customers in the new business. Extending a brand outside its core product category can be beneficial in a sense that it helps evaluating product category opportunities, identifies resource requirements, lowers risk, and measures brands relevance and appeal. Brand extension may be successful or unsuccessful. Instances where brand extension has been a success arei. ii. Wipro which was originally into computers has extended into shampoo, powder, and soap. Mars is no longer a famous bar only, but an ice-cream, chocolate drink and a slab of chocolate.

Instances where brand extension has been a failure arei. In case of new Coke, Coca Cola has forgotten what the core brand was meant to stand for. It thought that taste was the only factor that consumer cared about. It was wrong. The time and money spent on research on new Coca Cola could not evaluate the deep emotional attachment to the original Coca- Cola. Rasna Ltd. - Is among the famous soft drink companies in India. But when it tried to move away from its niche, it hasnt had much success. When it experimented with fizzy fruit drink Oranjolt, the brand bombed even before it could take off. Oranjolt was a fruit drink in which carbonates were used as preservative. It didnt work out because it was out of synchronization with retail practices. Oranjolt need to be refrigerated and it also faced quality problems. It has a shelf life of threefour weeks, while other soft- drinks assured life of five months.

ii.

Advantages of Brand Extension

Brand Extension has following advantages: 1. It makes acceptance of new product easy. a. It increases brand image. b. The risk perceived by the customers reduces. c. The likelihood of gaining distribution and trial increases. An established brand name increases consumer interest and willingness to try new product having the established brand name. d. The efficiency of promotional expenditure increases. Advertising, selling and promotional costs are reduced. There are economies of scale as advertising for core brand and its extension reinforces each other. e. Cost of developing new brand is saved. f. Consumers can now seek for a variety. g. There are packaging and labeling efficiencies. h. The expense of introductory and follow up marketing programs is reduced. 2. There are feedback benefits to the parent brand and the organization. a. The image of parent brand is enhanced. b. It revives the brand. c. It allows subsequent extension. d. Brand meaning is clarified. e. It increases market coverage as it brings new customers into brand franchise. f. Customers associate original/core brand to new product, hence they also have quality associations.

Disadvantages of Brand Extension

1. Brand extension in unrelated markets may lead to loss of reliability if a brand name is extended too far. An organization must research the product categories in which the established brand name will work. 2. There is a risk that the new product may generate implications that damage the image of the core/original brand. 3. There are chances of less awareness and trial because the management may not provide enough investment for the introduction of new product assuming that the spin-off effects from the original brand name will compensate. 4. If the brand extensions have no advantage over competitive brands in the new category, then it will fail. Brand extension or brand stretching is a marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category. The new product is called a spin-off. Organizations use this strategy to increase and leverage brand equity (definition: the net worth and long-term sustainability just from the renowned name). An example of a brand extension is Jello-gelatin creating Jello

pudding pops. It increases awareness of the brand name and increases profitability from offerings in more than one product category.