Brand Failures

PROJECT BY: Jigar Thakker-53001118030 Parthvi Shah-53001118031 Parth Dave-53001118032 Namrata Soni- 53001118033 Vidhi Shah- 53001118036

Sharanya Narayanan-53001118038 Pooja Salvi-53001118041 Pranav Ramchandran-53001118042 Pooja Manek-53001118043 Shramona Poddar-53001118044

Definition: Enhancing a brands equity directly through advertising campaigns and indirectly through promotions such as cause championing or event sponsorship is known as brand building. Branding is name, term, design, symbol or any other feature that identifies product Branding is the process of creating a name and look for your business.

Effect of a brand?

Compels preference in consumers mind by undertaking the following task: eye on the market the target consumer competitions market objectives the trademark

BRANDING
Branding is fundamental. Branding is basic. Branding is essential. Building brands builds incredible value for companies and corporations. most valuable asset of corporation

Brand owners manage their brand carefully to: - create shareholder value - brand valuation Proper branding can result in higher sales of not only one product, but on other products associated with that brand Consumers may look on branding as an aspect of products or services

Importance of Brands today

Brand is a promise. Brand is a specific combination of logo, words, type font, design, colors, personality, price, service, etc. Bundle of attributes. Sometimes a brand is memorable because of the little things.

Consumer & their perspective

Identification of Source of Product Assignment of Responsibility to Product Maker Risk Reducer Search cost Reducer Promise, Bond, or Pact with Maker of Product Symbolic Device Signal of Quality

Importance of Branding (manufactures)

Identification of the product Means of Legally Protecting Unique Features Signal of Quality Level to Satisfied Customers Means of Endowing Products with Unique Associations Source of Competitive Advantage Source of Finance

Brand Building Perspective

It is not easy to build brands in todays competitive environment. To be able to develop effective brand strategies, it is useful to understand these pressures and barriers.

Pressure To Compete On Price There are enormous pressures on nearly all firms to engage in price Retailers have become stronger year by year, and they have used that strength to put pressure on prices. There is an increasing focus on margins and efficient use of space.

Proliferation Of Competitors Additional competitors make it much harder to gain and hold a position. There is also an enhanced motivation to copy anything that is successful, in part because the risks of copying are offset by the difficulty of coming up with brilliant new alternatives.

Fragmenting Markets And Media

Complex Brand Strategies & Relationships

Variety of media platform . Refined target audience Multiple brand portfolio

There are sub brands, brand extensions, ingredient brands, endorser brands, and corporate brands. Brand characteristic The market fragmentation and brand proliferation have occurred because a new market or product often leads to a new brand or sub brand. Utilization of the brand in different product segments

Bias Toward Changing Strategies

Bias Against Innovation

There are sometimes overwhelming internal pressures to change a brand identity and / or its execution while it is still effective, or even before it achieves its potential. The resulting changes can undercut brand equity or prevent it from being established.

There is an incentive to keep the competitive battleground static. The result is a vulnerability to aggressive competitors that may come from outside the industry with little to lose and none of the inhibitions with which industry participants are burdened.

Pressure to invest elsewhere

Short term pressures

A position of great brand strength is also a potential strategic problem, because it attracts both complacency and greed. The diversification that attracts these resources is often flawed because an acquired business was overvalued or because the organizations ability to manage a different business area was overestimated.

Pressures for short-term results undermine investments in brands. There are several reasons why a shortterm focus might persist: - There is wide acceptance that maximization of stockholder value should be the overriding objective of the firm. - Annual budgeting systems usually emphasize short-term sales, costs, and profits. - A short-term focus is created by the performance measures available. Measurements of intangible assets such as brand equity, information technology, or people are elusive at best.

Classic brand failure

NEW COKE
Summary
Created to compete with Pepsi New Coke was a top secret operation Large amount of money to market New Coke Public was overwhelmingly negative about New Coke Old Coke formula was returned with HFCS

Objectives
A large marketing campaign was created to compete with Pepsi. Coca-Cola attempted to make Coke taste more like Pepsi. Smoother Sweeter Bolder

NEW COKE
Reason
Campaign failed. Coca-Cola failed to ask critical questions to its beloved fan base: Do you want a new Coke? Mistake cost money and reputation for a moment in time.

Purpose
Coca-Cola invested a large amount of money into a failed campaign. The company assumed New Coke would be better. Removed a successful product, Old Coke. Coke drinkers should have been addressed.

Lessons from New Coke (Solution)

Concentrate on the brands perception. Dont clone your rivals. Feel the costumer love and loyalty. Maintain the core quality of the product. Dont be scared to U-turn. Do the right market research.

Sony Betamax
During the 1970s, Sony developed a machine designed to deliver home videotaping equipment. The machine used Betamax technology, and hit the stores in 1975. But a year later JVC came out with VHS. Other companies followed the suit. Sony was not ready to part with its technology, but JVC was more then happy. This proved to be a critical factor in the demise of Betamax

What went wrong?

Until the early 1980s betamax was a synonymous with video recorder. But the association had negative as well as positive consequence, as universal studios and Disney took legal actions against them. Sony till continued betamax is superior technology. Drawback- its tapes could not record more then 1 hour 1982- betamax 25% market share 3 years forward- VHS constituted 95% of the market. Finally in 1988 Sony had to swallow its pride and announce a line of VHS.

Sonys mistake?
Going all alone Refuse to license its format Sonys Decision to ignore VHS.

Lessons learnt form SONY

Dont go it alone. Let others in. Cut your losses. Supply equals demand. Decreased their supply of Beta format tapes, demand for Sonys Betamax Recorders inevitably waned.

New Business Idea failure

New Business Idea failure

Established in 1997 It started its subscription-based digital distribution service 2009 it was offering a collection of 100,000 titles on DVD and had surpassed 10 million subscribers.

The Business

In 2009, NETFLIX had set-up a distributing business of 46 million DVDs across North America. Its major markets being U.S.A and Canada. With charging only $8 for their monthly subscription of their website. This allowed the members to access content over 100,000 titles on DVD

The Business

2009- distribution of 46 million DVDs Subscription cost of only $ 8 This allowed the members to access content over 100,000 titles on DVD Stock prices rose from $ 43 to $192. The rise of NETFLIX resulted in almost doubling of their subscription which rose from 10 million to 20 million Rise of NETFLIX was credited to one man Reed Hastings

What went wrong?

Netflix adapted and did a technological shift Netflix was split into two companies

Case study learning

Business ideas need to be relevant and optimized for easy access and consumer viewing Brand failure occurs due to the product being complicated

Indian Cricket League

The Indian Cricket League (ICL) was a private cricket league funded by Zee Entertainment Enterprises The league was operated between 2007-2009

The business

The first Twenty20 over format of private club participating in a cross country tournament Had the potential and commercialize cricket to a next level What went wrong? The league lacked the support of BCCI It was a private idea which was lacking marketing and quality of the game

Case Study learning

Marketing genius to revive the brand Increasing the relativity of the sport Simplifying the system the sport was played and making Indian consumers or audiences understand the league playing format

Brand Extension

Brand Extension
Using an established name of one product class for entering another product class. Using a successful brand name for launching a new or modified product or line is known as brand extension strategy. An expansion strategy in which firms use already established and successful brand name for introducing a new or modified product

Negative impact
Adversely affect value associated with brand. Brand extension that fails to make an impact may dilute equity of a reputable brand name. Brand extension may carry typical attributes of parent that may be dangerous to extended brand.

Cast Study BRAND EXTENSION FAILURES

Harley Davidson perfume-The sweet smell of failure PONDS TOOTHPASTE- a failure owning to brand perception

Harley Davidson Perfume

American motorcycle manufacturer distinctive design and exhaust note licensing of the Harley-Davidson logo amounts to approx. 5% of the companys net revenues. Long-term relationships with the customers

Brand Value
Freedom Authenticity Community Building Rituals Masculinity Toughness

Brand Extension
T-shirts Jackets Caps Gloves helmets key chains socks ornaments etc.

Case Study learning

Focus on your brand values. Dont alienate your core customers Remember that more is less. Keep it tight. Handle love marks with care.

Ponds toothpaste & extension failure

Ponds is a unilever product Ponds made a smooth transition from a cold cream to Age defying creams, soap, face-wash, talc etc. The attributes required in toothpaste case were simply missing.

To consumers the brand Ponds was nothing but fragrance & a consumer product for external application only Thus perception of cleanness and freshness is taken so differently in different products.

Case study learning

Know what creates core value for your brand Dont take something away that your most loyal consumers love To reach new audiences, start with your core brand promise Failure helps you learn and come back stronger Bottom line: Know your brand. Your authenticity is what creates connection and authenticity and connection never go out of style even if the world around us changes.

Cultural Failure
Every market has a different culture, failure to understand that culture while adapting a brand extension can lead to brand failure

Cultural Transitions
McDonalds in India Changed their menu to suit the Indian taste palate. They also began cooking their food in vegetable oil as opposed to animal fat. Removed beef and pork from the menu to appease religious values.

Dominos In India Changed menu for Indian people- introduced variants like Peppy Paneer, Tandoori Chicken etc.
Tupperware India Introduced boxes keeping the Indian requirements in mind like 5kg rice box & masala box amongst others.

Failed cultural transitions

Pepsi In Taiwan Failed to take the language difference into account. Come alive with the Pepsi generation was translated, as Pepsi will bring your ancestors back from the dead. Electrolux in U.S.A Scandinavian vacuum manufacturer Electrolux raised a few eyebrows in the United States when it came up with the slogan Nothing sucks like an Electrolux. It later reworked its strap line.

Cultural transitions

Case Study

Established in 1906 when Will Kellogg accidentally discovered breakfast cereal in Michigan. It had an all time peak market share in the U.S.A of 40% in 1980s. Entered Indian market in 1994. Pitched itself as alternative breakfast option to the heavy hot breakfast options the Indians were accustomed to. Indians did not accept the cold sweet tasting breakfast that Kellogg's was offering. Kellogg's prices were high & not affordable to many people.

Cultural transitions
Tried to Indianize its range have been disastrous. Its Mazza-branded series of fusion cereals, with flavors such as mango, coconut and rose, failed to make a lasting impression. The crispy flakes they were using as their USP became soggy as soon as milk was poured thus ruining the very essence of the USP. Major reason for their failure was the failure to understand the Indian eating culture and also trying to force change on the people.

Brand revival
Tried to revive the Indian market by Prices reduction. Kelloggs increase the retail packs of different sizes to cater the needs of different consumers group. Kelloggs repositioned the product as tasty nutritious food Products were not positioned in premium categories. Indianizing the products by introducing the sweeter product. On ground promotion activities like Kellogg health week and free samples distribution in schools and to housewives. Projection of products as fun-filled' brands rather emphasizing only on the nutrition value.

TESCO
Tesco plc. is the worlds 3rd largest retailer and number one in U.K Entered the U.S market in 2007 under the brand name FRESH & EASY. Opened outlets in California, Arizona & Nevada. Flopped because it failed to recognize the shopping culture of the American people.

Cause of Failure
Presumed shopping patterns in America and Britain would be alike. People in U.S prefer to buy things in bulk but Tesco offered small pack sizes. The Fresh & Easy stores offered a range of British products, but didnt focus enough on local American products. The focus on ready-made meals didnt resonate with shoppers either, and it certainly didnt help stores live up to the fresh name. The US customers love to fill their freezers with frozen food, something Fresh & Easy ignored at the beginning. By the time they introduced frozen food it was too late. The American way of shopping Car culture and weekly shopping expeditions.

Solution
If they had realized that the Americans like large serving sizes, large packets that would last them the whole week the story might have been different. They should have had their stores strategically located near tube stations, subway stations, bus stops where they could have maximized on their fresh food concept They should have slowly and gradually tried to change the perception of cold storage that the Americans were so habituated to and induced the concept of fresh eating. This failure could have been avoided to a large extent if TESCO had hired an analyst or an American market expert to guide them into the American market. TESCO could have partnered with a small time American grocery chain and entered the market.

 Rebranding is a marketing strategy. Rebranding efforts include a name change, new logo or packaging and image, marketing strategy, and advertising themes. Goal is to influence a customer's perception about a product

Re-Branding Failure
Not thinking carefully before rebranding can risk undermining their previous marketing efforts. Makes changes for the simple reason that this makes sense for the company. End up following in the ill-fated footsteps.

Tommy Hilfiger
Tommy Hilfiger Corporation is an American company which is incorporated in Hong Kong. The company uses a red-white-blue rectangle as its symbol. Delivers superior styling, quality and value to consumers worldwide

Re-Branding Failure
Tommy Hilfigers logo has always been its key branding strength. Suggested that the logo be changed to give it a trendier feel. Tommy Hilfiger abandoned the values that had built the brand The company launched Red Label, a sub brand without the Tommy Hilfiger logo, which targeted the upper segment of the society.

Consequences
Tommy Hilfigers share price fell to US $22.62 on New Years Day 2000, and was cut in half again by the end of that year. Sales reduced drastically and several showrooms were shut down. Location strategy of the company was flawed.

Case study learning

Dont deviate from your formula. Dont compete with irrelevant rivals. Dont over-extend the brand. Dont be scared of your logo.

TROPICANA
Tropicana Products is an American multinational company which primarily makes soft drinks. It was founded in 1947 by Anthony T. Rossi in Bradenton, Florida. The company specialises in the production of orange juice.

TROPICANA Re-Branding
PepsiCo re launched Tropicana with new packaging and created a new advertisement to promote it. The old design of an orange with a straw in it was replaced with a glass of orange juice. The normal screw cap was replaced with a squeezable cap which had the appearance of half an orange.

Re-Branding Failure
Labelling Information Structure Tone of Voice Typography Imagery Colour Brand Speak Affordances

Domino effect
PepsiCo was bombarded with emails, letters and phone calls of complaints. The new packaging was too generic and resembled a store brand. PepsiCo was forced to respond to the heavy criticism and reinstated the old packaging imagery, as a means of placating consumers and creating positive public relations.

Conclusion
Never try to solve something which is not a problem in the first place