Saturday, September 5, 2009

Bye bye American Pie, the year the branding died?

2009 has been a shocking year for brands and just made life more difficult for those of us who believe in their power. That venerable old brand, Lehmann Brothers, kicked it all off by exiting stage left and nearly bringing down the world financial system with it. At first glance, naysayers could argue that this underscores that brand is not the be all and end all of business.

However, I would argue the opposite. In a perverse way, it demonstrates the power of brand and the enormous impact it can have when core beliefs about a brand are shattered. If Lehmann Brothers had been less well known, its collapse would not have triggered the crisis of confidence in the financial system that followed - even though the technical financial implications would have been the same.

The US automotive sector has also been challenging for brands. General Motors has shed some brands as it has scrambled for survival. But what this illustrates is not failure of brand, but failure of management to be true to brand. It is well documented that the company's focus had become short-term financial - a slave to the daily scrutiny of analysts rather than a servant of all the things that had made the company what it was.

The result was products that had lost their appeal, fallen short on quality expectations. The company had forgotten how to innovate and inspire. No one new what it or its products stood for any more. There was no emotional tie to a Buick when a Honda would probably do the job better.

The other phenomenon dismantled was the aggregation of non-traditional brands by GM and Ford. Great European brands like Saab, Jaguar and so on were collected like trophies without proper thought given to heritage and what their customers loved about them (in some instances, despite their obvious failings!). The US juggernauts strode in and started building them on common plaforms with other mainstream products, compromising the uniqueness of their character.

So perhaps 2009 wasn't the year that brands died, but hopefully the year that will ensure brand value is better understood in the future.

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