all Insights

Diet Coke’s Rebrand: The Good, The Bad, The Ugly

Article after article has praised Diet Coke for making this “bold” move. However, most fail to recognize the flawed strategy behind the design and potential dangers in some of their design and messaging decisions.

Diet Coke’s new look aims to attract health-conscious millennials by adding four new flavors, modernizing the typography of the Coke logo, adding color and illustrations to the package, and introducing a slimmer 12 oz. can.

Although the brand seems to have good intentions, Diet Coke misses the mark in our books. This is a classic example of a brand attempting to target a particular audience without really understanding said audience and using faux innovation to cover up gaps in their brand strategy.

The Good: What They Got Right

The move to a sleek, slimmer can heightens the illusion of a “diet” soda being a healthier choice. This move, reminiscent of Sparkling Ice, gives off a lighter, high-end feel. Additionally, in most of their messaging the brand leaves out the word “soda” completely. Reframing the brand as a sparkling beverage instead of a soda positions it to seem healthier and more adult-friendly. The brand seems to have taken a page right out of DRY Sparkling’s book with this move.

As we all know, bottled water sales now far outpace soda sales in the U.S. and sparkling water is rapidly approaching that milestone as well. Strategically introducing four new fruity flavors to the Diet Coke line potentially threatens to grab market share from millennial LaCroix lovers. Targeting this booming demographic – although not necessarily revolutionary – is a smart move. Millennials hold tremendous buying power, so it would be foolish for a brand to ignore this influence.

“From the vector illustrations to the ‘fresh’ new flavor names, they’re screaming at a Millennial and Gen Z audience saying, ‘Hey, remember Diet Coke, the original diet beverage? We’re not a normal soda, we’re a cool soda.’” – Kat Simpson, designer at Retail Voodoo

Unfortunately, we’re not sure those “hip” new flavors (like twisted mango) will be used for what Diet Coke intended. Instead, we feel they’re just one step away from partnering with Smirnoff. These “feisty” flavors scream college party mixer. From their messaging, it seems like they’re trying to give consumers “what they wanted.” but it feels more like they are trying to re-engage those consumers that have already grown out of the soda phase of life. Although we don’t see the new flavors being consumed in a way Diet Coke intended, we can see them being used a bit more than the classic flavor is being used currently. But hey, at least we can see the flavors being embraced on some level – even if it’s not the intended one.

The Bad: What They Got Wrong

In terms of identity, Diet Coke failed to meet our expectations. The design and messaging changes feel disjointed and misleading. The flavor illustrations feel like an afterthought and destroy the only interesting new element of the can: the stripe.

“You can start to believe that the reduction of graphics and exposed can is like wearing a bikini after a diet, but those illustrations stop any dreamy visions you have like that.” – Eric Wyttenbach, senior designer at Retail Voodoo

The flavor naming conventions try to be young but just seem confused (twisted mango, zesty blood orange, feisty cherry, ginger lime). What’s so feisty about cherry Coke? They really feel like party drinks, not healthy and refreshing alternative beverages. And although as we stated before, this might potentially give a bump in sales, it won’t be among the target demographic nor will these flavors expand Diet Coke’s reach into new realms as this redesign intended.

The Ugly: The Bottom Line

A pretty new package, strong advertising, and fun messaging might be enough to briefly drop Diet Coke back into this audience’s consideration set. But when this audience takes one look at the label and sees that aspartame is still present, they’ll place it back on shelf and avoid it like the plague.

“News flash: Millennials and Gen Y are label readers.” – David Lemley, founder & chief strategist at Retail Voodoo

Although messaging and design updates attempt to communicate health, the brand still uses the harmful ingredients that repelled these consumers in the first place. Ultimately, Millennials will never replace their LaCroix (or any sparkling water for that matter) with soda.“This feels like a disingenuous move driven by a desire to pander to younger audiences and health-conscious consumers, but I predict both audiences will see through it and shun the can as a poser.” – Jacob Carter, design director at Retail Voodoo

Diet Coke’s VP of marketing is quoted in AdAge as saying that they didn’t want to change the formula for fear of risking their current loyal audience. They ignore the fact that nutrition and ingredient labels are important to most young people. Looking on-trend doesn’t matter when the product is full of unhealthy ingredients. If Diet Coke really wanted to make a bold move, they would have removed aspartame fully.

Diet Coke’s redesign is a prime example of why diet soda sales continue to fall. Brands focus on the exterior appearance of their products without addressing the real issues lurking beneath the surface.

Diana Fryc

For Diana, a fierce determination to pursue what’s right is rooted in her DNA. The daughter of parents who endured unimaginable hardship before emigrating from Eastern Europe to the U.S., she is built for a higher purpose. Starting with an experience working with Jane Goodall to source sustainably made paper, she went on to a career helping Corporate America normalize the use of environmentally responsible products and materials before coming to Retail Voodoo.

Connect with Diana
all Insights

Brand Strategy Checklist 1: Strengthen Your Brand’s Body

We all agree that brand strategy is vital to your business. Profit, loss, fame, or ruin all hang in the balance. Since getting it right is critical and fortune favors the well-prepared, Retail Voodoo created our own brand strategy checklist toolkit to drive all client engagements.

Why is Retail Voodoo’s brand strategy checklist in three parts?

Over the years, we’ve helped hundreds of clients evolve their businesses through brand strategy. So, we’ve learned a few things about how to make it stick. And we believe the journey of developing a comprehensive brand strategy is best broken down into three realms:

  1. The physical (external forces) that influence your brand.
  2. The mental (the psychology) of the organization.
  3. And the soul (the spirit) of the brand.

Just like people, when your organization’s brand strategy has clarity and alignment in these three realms, the outcome is strength and confidence, powerfully focused on the future. In this first installment of our brand strategy toolkit, we explore the physical, external forces that influence the mechanics of your brand. The external forces or physical aspect of brand strategy will help us see the way toward meaningful and long-lasting differentiation.

For brand strategy to be successful and lucrative, your team not only needs to understand but collectively buy-in to the ways in which the outside world shapes your brand’s reality. Let’s look at the difference between a competitive audit and competitive advantage with the goal of using both to put shape to audience mapping through the lens of trend analysis.

Competitive Audit

What is it? 
The basic version is a review of all the competing brands in your space and how they communicate. But this is just the beginning. A meaningful competitive audit also looks at offerings, events, and circumstances competing for your audience’s attention and dollars.

The “Retail Voodoo Way:”
We assess all of your competitors with this checklist. We study their social media streams, public relations, consumer-facing communication, in-store, and online experience. We then benchmark your brand against that information.

What you can do with it:
When armed with a robust competitive audit, your company’ has the power to change from emotion-based marketing to differentiation based communication. It also lays the foundation for seeing innovation from a strategic perspective rather than merely opportunistic.

Questions to ask:
1. Do we know our real competition?
2. What adjacent categories are consumers looking at when considering our brand?
3. What other businesses and products might we make if we had clarity?

Core Audience Map

What is it?
A comprehensive profile of who currently purchases your brand.

The “Retail Voodoo Way:”
A meaningful core audience map goes beyond demographics by placing the people currently buying your brand into an audience-to-be universe. We use primary research to map this and find out who is different and where things overlap.

What you can do with it:
A research-driven core audience map gives a company new power. Not only does this allow for easier persona creation in sales and marketing, but helps leadership and product development get into new businesses and get out of others.

Questions to ask:
1. What primary research are you using to build your current audience map?
2. Who else in your category shares the same audience?
3. Who would you include in an audience-to-be map?

Competitive Advantage

What is it?
Admit it, you think this one is obvious. But remember, there are 300 choices of toothpaste. But competitive advantage isn’t simply what you make, who you are, and how good you are at the 4 P’s of marketing (product, price, place, promotion). In our world, it’s much more.

The “Retail Voodoo Way:”
We look at competitive advantage as a three-legged stool. First, we determine what your company does or makes better than anyone else. Then we look at whether you have proprietary ingredients in your matrix, or not. Finally, we look at who is disrupting you – along with how and why. And when appropriate, we look at which competitors and adjacent categories your brand can disrupt.

What you can do with it: 
Once your team understands your distinct and ownable differences in the competitive landscape, your brand has a chance to move from competing on price and being in the right place to being sought out and commanding a premium at the same time.

Questions to ask:
1. What market conditions exist to give us clear competitive advantage?
2. How and why are we different than others with similar offerings?
3. What needs to change internally or externally for our brand to have a stronger advantage?

Trend Analysis

What is it? 
Trend analysis for branding is different than the financial world. In branding, history does not necessarily repeat itself. In brand strategy, trends are social proof.

The “Retail Voodoo Way:”
Since brands and branding run on the backbone of modern culture, it is imperative to anyone crafting a brand strategy to have insight into what’s coming next. But that takes more than following the Kardashians on Instagram. We believe data, shopper insights, and emerging cultural preferences are the strongest predictors of trends that brands can leverage.

What you can do with it: 
A validated trend report provides management with confidence to move boldly toward a new future, create new offerings, and stop producing items that no longer fit the cultural norm.

Questions to ask:
1. How do our products and services fit into modern society?
2. What social proof do we use when evaluating our innovation pipeline?
3. How might our business change and grow by paying attention to trends as part of strategy?

In our next installment of our brand strategy checklist, we will focus on the psychological aspects that shape your brand.

David Lemley

David was two decades into a design career with a wall full of shiny awards and a portfolio of clients including Nordstrom, Starbucks, Nintendo, and REI. His rocket trajectory veered when his oldest child faced a health challenge of indeterminate origin. Hundreds of research hours later, David identified food allergy as the issue and convinced skeptical medical professionals caring for his child. Since that experience, David and Retail Voodoo have been on a mission to create a cleaner, healthier, more sustainable food system for all.

Connect with David
all Insights

Four Packaging Trends to Look for at Expo East

We’ve been on the lookout for the most compelling packaging trends coming up in the food and beverage industries. Just as consumer behaviors constantly change, so do design trends. Oftentimes, we identify trends after they’ve come and gone. Brands must think one step ahead at all times. Being a leader of an emerging trend gives your brand an enviable competitive edge.

As the better-for-you food and beverage industry continues to boom, it’s no wonder why CPG brands are fighting tooth and nail to stay relevant. Packaging is often the first (and only) touch-point connecting consumers with brands right from the shelf.

With Expo East right around the corner, we’ve pulled together our top predictions of what you’ll be seeing this fall.

1. Overhead Photography

The Instagram flat-lay knolling trend has crept out of the digital world and taken over CPG. There are two key strategies within this trend – detailed, slightly messy table setups and strictly ordered, grid-like layouts.

The messier setups emphasize the authenticity and home-cooked feel of products. Instead of overly edited and produced close-up shots, consumers see the food as how they might actually see it as they prepare it in their own kitchen. This point of view transports the product from the shelf right to their table.

More organized, structured overhead photography shots play to the consumers who love order. They associate clean lines and organization with wellness – both in the mind and body. Timbuk2 pioneered this concept with their unpacked bag flat lays. Each item to be packed into one of their stylish bags lay on the ground, organized in a neat grid. This simple, clean photography style illustrates the capacity and functionality of the bags. The same concept applies to food and beverage products, so we expect to see plenty of this style of photography in the coming months.

2. Natural Colors are King (Still)

Pantone declared “greenery” the color of the year for a reason. Color is a universal language we can use to communicate with customers. Certain colors activate appetite, signal danger or emulate peacefulness. Triggering emotions through the use of colors builds a stronger connection between a product and its consumer.

Green represents health, well-being, eco-friendliness and sustainability. Earth tones signal natural and wholesome ingredients. These colors heavily impact the perceived healthiness of the product.

The one caveat to this trend is that consumers expect these colors in the specialty food sector, so it is important for brands to innovate their packaging to stand out on the shelf. Thinking beyond color will be crucial as the specialty food sector continues to grow.

3. Keep it Simple

While minimalism has been a packaging design trend for a while, there is a difference between minimalistic design and simple design. Minimalistic design can be trendy and clever whereas simple design is more straightforward and honest. Ultra-trendy packaging screams desperation. Brands embracing extremely complex or hyper-minimal design are perceived as try-hard and unsuccessful – especially in the specialty food sector.

Health-conscious consumers tend to be more skeptical of packaging. They are more likely to pick up the product to read the label. When brands revert back to simplistic design, it is asking the consumer to do less work to get what they want. They do not have to decipher a clever design or illegible text to understand the product’s function and contents. In today’s busy world, consumers find relief in design simplicity because it takes less time to translate into information.

Now, simplicity does not mean you have to put “HERE IS A BAG OF CHIPS ” in black text on a white bag. Simplicity can even be unique geometric patterns or an interesting texture. The packaging just needs to elevate the product instead of distract from it.

4. Breathe Authenticity

The word “authentic” seems to be the buzzword of 2017. Anyone and everyone is scrambling to crown themselves the most authentic of their category.

In the packaging world, authentic means unique and honest. Hand-drawn lettering, for example, signals the natural and hand-crafted nature of the product. When lettering looks like handwriting, it humanizes the brand more – enabling consumers to emotionally connect.

Narrative illustrations conjure playful and nostalgic feelings of innocence. Using illustration to create a narrative tells a story to the consumer. As consumers seek for a deeper connection to the brands they purchase, a product telling a story will pull at their heartstrings.

Vintage inspiration is another piece of this trend that resonates with consumers. It comes from diving into the roots of history and uncovering the greatness that lies there. When we think about authentic food, it often comes from specific regional recipes or family traditions passed down from generation to generation. Vintage design and authenticity go hand-in-hand.

We’re looking forward to seeing lots of authenticity, simplicity, natural colors and overhead photography on the shelves this fall. If you’re going to Expo East, let us know – we’d love to meet you there and chat all things marketing! Shoot us an email or give us a ring to set up a quick meeting.

Diana Fryc

For Diana, a fierce determination to pursue what’s right is rooted in her DNA. The daughter of parents who endured unimaginable hardship before emigrating from Eastern Europe to the U.S., she is built for a higher purpose. Starting with an experience working with Jane Goodall to source sustainably made paper, she went on to a career helping Corporate America normalize the use of environmentally responsible products and materials before coming to Retail Voodoo.

Connect with Diana
all Insights

Conventional is the New Specialty Grocer

If you’re the owner of a natural/organic food brand you know the roller coaster. Natural product stores, from Whole Foods to the smaller independents, might love your brand today and discontinue it tomorrow. Let’s face it, shelf space is always at a premium and brands are subject to getting bumped for a variety of reasons. If turns are slow at first, out you go. If another brand comes along that looks sexier, you’re gone. If the retailer decides on private label offerings in the category, finito. It isn’t easy to get into most retail stores to begin with, but it’s easy for them to give your brand the boot.

These are the scenarios at retail. You know it and we know it. The question is: what to do about it? You have to recognize as the entrepreneur of a small brand that distribution is key to survival and that means having a presence in different channels. You might not like the idea because you think your natural/organic brand belongs in natural product stores, but that kind of thinking will hamper your chances of success. In 2015 the number of organic items available in traditional grocery stores was up between 35 percent and 50 percent, according to estimates from investment bank Piper Jaffray.

Never put all of your eggs in one basket, right? While the traditional natural product shopper continues to buy at Whole Foods, Trader Joe’s and their local health food stores, there are plenty of other customers who are buying natural/organic products in other channels. They may not be as hardcore, as educated about the products, or as dedicated to buying whole foods and clean products all of the time, but there are millions of these consumers shopping in mainstream retail stores. And having access to products that they know are intrinsically healthier choices influences buying decisions.

That’s why your goal has to be to take your natural/organic brand and cross over into mainstream retailers both online and off. Sure, some conventional shoppers are dabblers. However, others will try your brand, like it, and become loyal consumers. They’ll tell their friends and that buzz will help build your business.

With eggs in multiple baskets, it isn’t a disaster if a major player in the natural/organic industry drops your brand, either. You can sustain that and look for more distribution as you go along. Revered brands like Traditional Medicinals did this a long time ago. They’ve got a presence in natural food stores and supermarkets, including Wal-Mart, specialty/gourmet stores, drug stores, and among e-tailers. More recently Alden’s Organic Ice Cream and Hilary’s Eat Well – purveyors of veggie burgers, salad dressings and snacks – made the same leap. They have gone from exclusive distribution in natural product stores to stocking their products in supermarkets. Smart.

The natural/organic category is no longer an afterthought for retailers, but a powerful part of their over overall merchandising strategies. There’s a commitment to expanding these categories like never before.

Enter the trendsetter for non-traditional consumers: Target

We all know that when Target gets behind a category and niche, the retailer has the power to move the needle in a big way; it’s been no different for consumers seeking better-for-you alternatives. In a recent article in Business Insider, Target CEO Brian Cornell is quoted from a November conference call: “We’ve been very focused on assortment changes and bringing more natural, organic, local items into many of our categories, and we’re seeing the guest react very favorably.”

Given its M.O., Target will experiment, bring in the unusual, merchandise creatively, and go after natural/organic in a meaningful way (i.e. go after Whole Foods in a meaningful way). They’re not alone, although they’ll likely do it best. Hence the title of the article in Business Insider: Walmart, Target and Aldi are addressing a huge weakness—and it’s turning into Whole Foods’ worst nightmare.

Reread: There’s great potential growth in mainstream retail stores; the consumer is primed and ready for it. Natural/organic can be attractively priced against specialty retailers without sacrificing quality while still enjoying much better margins than the average fast-moving consumer goods (FMCG) brands.

There’s an interest among the nation’s largest food retailers to source more local products and brands, as well – the former bastion of natural product retailers. With the lines continuing to blur, consumers expect to find these products where they shop in their daily life. Things are going to get even more interesting; stay tuned.

David Lemley

David was two decades into a design career with a wall full of shiny awards and a portfolio of clients including Nordstrom, Starbucks, Nintendo, and REI. His rocket trajectory veered when his oldest child faced a health challenge of indeterminate origin. Hundreds of research hours later, David identified food allergy as the issue and convinced skeptical medical professionals caring for his child. Since that experience, David and Retail Voodoo have been on a mission to create a cleaner, healthier, more sustainable food system for all.

Connect with David
all Insights

Disrupt. Create a Category of One

We’ve heard it all before. “There’s nothing new under the sun.” “It’s all been done before.” “Timing is everything and this isn’t the time to start anything new.”

Thankfully, the intrepid among us have never taken any of these ideas to heart. If they did, great inventions would have never happened and great brands might never have seen the light of day.

If anything, consumers are hungry for something new and exciting since they’re mostly confronted with the banal and the boring. But here come the excuses. Challenging consumer economy. Too much competition. It’s a short route to commoditization. Check, check and check.

There’s only one thing to do in this scenario. Disrupt. Because if you don’t, your brand is just one among many like brands with nothing to distinguish it from everything else out there. (You’ll muddle along but you’ll never be great.) But you can only disrupt if you dare.

In a Fast Company interview a few years ago, brand visionary, Scott Bedbury, of Nike and Starbucks fame nailed it: “I walked through a hardware store last night and I came across 50 brands I didn’t know existed,” said Scott Bedbury. “They may be great products, but they’re not great brands.”

Exactly.

Before Starbucks came on the scene, there were local coffee shops. Mostly ho-hummers. Nothing exciting in the way of offerings; coffee burned from being kept heated past its expiration date and a little local gossip. So why not create a magical third place? A welcoming environment that isn’t home or the office. A place conducive to gathering and staying, engaging in conversation in a pleasant atmosphere replete with mismatched chairs for a touch of hominess. A place offering a plethora of caffeinated beverages made to order with the best of ingredients.

Result? Home run. All because Howard Shultz went to Italy and saw how a coffee shop could be. And dared to bring the idea to our shores. Shultz could have said: too much competition and too much commoditization in the category. He would have been right unless he dared to disrupt. And he did.

And he isn’t the only disrupter, right? Nike did it in the sneaker category. KIND did it in the crowded nutritional bar category. Glaceau did it with water (can’t have a more basic commodity than that!) Plum Organics did it with baby food. REI did it among outdoor gear retailers. Whole Foods did it among natural product retailers. And Trader Joe’s did it among specialty/gourmet and natural retailers including Whole Foods.

These are all one-of-a-kind brands. They’ve smashed through the walls of their categories and reshaped the world as we knew it. Think about that.

So what does it take to disrupt? A few things.

  1. A willingness to step back and take a different view of categories because you’re looking for opportunities.
  2. An assessment of what’s lacking that would make people find meaning in your brand versus the others that are out there (read: the uninspiring and meaningless.)
  3. An intrepid spirit to go where no man or woman has gone before within the category, whether you sell goods or services.
  4. A full commitment to the brand: sticking to who and what you are and forgetting about all of the rest. (Brand dilution continues to be a big problem for brands large and small.)
  5. A willingness to continue to innovate within your brand proposition; to be willing to try things and sometimes fail so that you can learn and get stronger.
  6. An acceptance that others are going to try to knock you off by emulating what you do and responding by doing even better.
  7. A total focus on your customer who is your fan and a follower of your cult.

I know what you’re thinking. “This is terrific but in this economy who’s done anything lately?” Answer: lots of entrepreneurs have and they’re still doing it.

To wit: two women in New York City started up a new cupcake bakery. That’s an idea that’s already peaked, right? Prohibition Bakery brought the talents of two women: baker Brooke Siem and bartender Leslie Feinberg together four years ago with a unique brand idea. “People love cupcakes. People love booze.” Why not make liquor-laced cupcakes?

The bakery creates WOM like crazy because of its uniqueness. It really doesn’t have much competition if any. Does that mean others won’t come along and try to replicate their brand? Of course not. So Siem and Feinberg continue to innovate based on drink trends. Partnering with drink brands for promotions and creating new cupcakes based on specialty drinks only creates more word of mouth.

What I love: they’re clear about what they won’t do: deviate from making cupcakes to make cakes or meet special requests for dietary restrictions and customized decorations (too costly and inefficient—there are plenty of bakeries occupying those niches, besides—important to note.) This brand is well-defined. So is the strategy. They’re not aimlessly seizing on just any old trend if it doesn’t fit their brand and its unique positioning.

Why play in the same space as countless other brands? Why not seize on a unique idea as these smart women have done? I mean cupcakes that come with a warning label; that you need an ID to purchase? Cool.

Oh, wait. You’re not doing a start-up; you’ve already got an existing brand and it’s stuck in the mud. Okay, so what are you going to do about it?

I assure you: there are opportunities to stake out your own brand territory, but that proposition isn’t for the faint of heart. You’d better plan on rolling up your sleeves, working hard, and keeping your vision on track if you want to be successful. But the pay-off. . .to be the one and only? Wow!

Checkmate.

David Lemley

David was two decades into a design career with a wall full of shiny awards and a portfolio of clients including Nordstrom, Starbucks, Nintendo, and REI. His rocket trajectory veered when his oldest child faced a health challenge of indeterminate origin. Hundreds of research hours later, David identified food allergy as the issue and convinced skeptical medical professionals caring for his child. Since that experience, David and Retail Voodoo have been on a mission to create a cleaner, healthier, more sustainable food system for all.

Connect with David
all Insights

Brand Extensions: Worth Doing or Not?

Quick: how many new brand extensions made an impact on you last year? Can’t remember many, if any, can you?

That’s the problem.

So many new products come out and fail; So few are memorable. Even fewer are hits.

It’s just too tempting. That’s why brands repeatedly go out on the proverbial limb and extend their brands. The problem is that it’s ill-advised to extend brands without answering fundamental questions first. “What is the #1 ownable aspect of the brand in consumers’ view?” Then: are there logical reasons for wanting to extend the brand? What are they? After all, it has to make sense to the company involved or it surely won’t make sense to consumers.

What many people perceive as brand extensions are in reality, line extensions. If an established brand adds a new variety to its existing assortments, it’s a line extension. Brand extensions take an established, well-recognized, respected brand into an entirely new category or categories of consumer products.

6 Reasons for Considering Brand Extensions:

  1. Finding logical categories to expand the brand’s footprint. Ocean Spray is a great example. Leveraging its cranberry business into the juice category and the snack category with Craisins were both logical moves and they’ve paid off.
  2. Creating a new category that makes so much sense consumers marvel that it hasn’t been thought of before. The Tide To Go stain removing pen that treats spots no matter where consumers are is a perfect example.
  3. Leveraging the equity of a respected brand’s assets and raising its visibility to more consumers. Harley Davidson’s biker boots and apparel are a winner for both bike owners and wannabes.
  4. Expanding the business with products in viable categories when sales are mature in existing ones. Kellogg’s Special K is a great example of a brand that leveraged the idea of losing weight from cereal to cereal bars, shakes, waffles and crackers.
  5. Reducing potential risk and lower costs of entry since going to market with a recognized brand is far easier than trying to build a new one from scratch. There’s inherent trust among consumers which is a major asset. Crayola is a brand that went from being a crayon company to a provider of paints, markers and creative play sets for kids.
  6. Ability to utilize the company’s expertise in branding, marketing and advertising and sharing these resources for the fledgling brand extension until it gets established and merits its own dedicated team.

By making rational assessments and tapping into consumer research, potential mistakes that can possibly harm or dilute the parent brand can be avoided. There are plenty of examples of brand extension failures; some of them embarrassing the most powerful of consumer brands. Who remembers Richard Branson’s powerful Virgin brand’s failures: cola, jeans, liquor? Thankfully for the company the brand name is so strong that its brand extension flops didn’t damage it. That’s a rare phenomenon when a brand has experienced a number of failed extensions.

While the Virgin brand offers consumers more value, more enjoyment and an unwaveringly high level of customer service and satisfaction, it could not break into categories where it didn’t seem to “belong” in consumers’ eyes. Or in categories where powerful brands already dominate: Coca Cola, Levis jeans, Smirnoff vodka. Extensive research would have uncovered that.

7 Dangers When it Comes to Brand Extensions:

  1. Stretching a brand that doesn’t have an ownable asset other than its brand name. There are high recognition brands that have considerable value but don’t “own” a specific asset in consumers’ minds. As a result, their brand extensions often fail. Xerox found that out. The brand is synonymous with “copiers”, not high tech. Repeated attempts to launch high tech office products and office networks failed.
  2. Stretching a brand with an ownable asset too far. Does anyone remember Bic underwear? What is Bic’s ownable asset? The concept of “disposable”; that’s why pens, lighters and razors work for the brand and underwear was a total flop.
  3. Not assessing what is truly ownable to the brand and then leveraging that in appropriate categories. A Harley Davidson cake decorating kit? Really? What on earth does that have to do with the rugged individualism, freedom and celebration of the open road embodied by the brand?
  4. Launching without consumer research: finding out whether consumers will accept the brand in a specific category is crucial. Do they associate the brand with the category or not? Is it acceptable to them or not? That’s how Hershey’s launched a chocolate milk product: research.
  5. Getting into incompatible categories in consumers’ view. LifeSavers soda? Is it obvious why this brand extension was a bomb?
  6. Getting into categories that are so dominated by other brands, it is hard to gain traction. Heinz is almost synonymous with condiments and food. When the company decided to stretch its brand to bring cleaning vinegar to market, it went up against major players in the cleaning category. It didn’t make sense to consumers, either. So it failed.
  7. Diluting and eventually destroying the brand by extending into too many categories, often via licensing agreements. Dior. Period.

As is the case with everything else, there have been solid successes and spectacular failures when it comes to brand extensions. Jello pudding snacks, Arm & Hammer baking soda toothpaste, Starbucks coffee liqueur and Planter’s peanut butter make sense so they’ve done well. But does anyone remember Pond’s (of face cream fame) and its ill-fated launch of toothpaste? Of course it bombed! How about Coors spring water? And Colgate, the oral care company’s foray into frozen entrees? Anyone can easily see why these brand extensions failed.

The moral of the story

Some of the best brand extensions include retailers’ store brands from Starbucks to Macy’s and retailers in all channels and sizes.

As long as the retailer has a loyal following, and an ownable brand there’s no reason why well-planned and developed brand extensions can’t be successful.

Retailers’ brand extensions appear in every category from apparel and hard lines to packaged consumer products. But they, too, have to make brand sense. And they have to have appeal to the customer because every category is crowded with competitive products. Otherwise, they won’t succeed.

Getting brand extensions into meaningful categories is only the first step. Labeling, hang tags, packaging and advertising—each consumer touch point has to carry the message and the brand forward. Brand extensions can be risky and even major brands have experienced failure, but the rewards can be great. It just takes asking the right questions, doing the research and making sure that extensions align with the ownable assets of the brand.

Best advice to brand owners: don’t go this one alone. Get expert help and advice. Too much is at stake: no less than the health and well-being of the brand.

David Lemley

David was two decades into a design career with a wall full of shiny awards and a portfolio of clients including Nordstrom, Starbucks, Nintendo, and REI. His rocket trajectory veered when his oldest child faced a health challenge of indeterminate origin. Hundreds of research hours later, David identified food allergy as the issue and convinced skeptical medical professionals caring for his child. Since that experience, David and Retail Voodoo have been on a mission to create a cleaner, healthier, more sustainable food system for all.

Connect with David
all Insights

Identity Crisis: The Seven Deadly Sins of Branding

Economic limbo cannot erase the fact that we live in a world where cars start the first time, phones are addictive and the gourmet coffee, is well, gourmet. Only the Unaware offer products or services they deem good enough to a world where everyone can get anything they want almost anywhere.

Today’s consumer is looking for you, the brand steward, to provide them with a self-actualizing experience. And while this needs to be orchestrated carefully, take heart, ending up in branding purgatory doesn’t happen overnight. It comes after a lifetime of refusing to be saved. Sadly, for every good thing we can do, there are many more actions we take either purposefully or by happenstance, that simply don’t contribute anything worthwhile to the brand’s presence, personality and strength.

So what can the faithful do to avoid such a fate? Keep a watchful eye over the Seven Deadly Sins of Brand.

Ennui is essentially boredom brought about by prosperity: an unwillingness to investigate, evolve and challenge or do much of anything. It has killed many great brands while their executives scatter to new, unsuspecting organizations, secretly scratching their head in wonder that their former co-workers were unable to learn new ways to gain market share. It begins something like this, “No one can touch us. We are superior in every way!” Then subtly evolves to something more like this, “We are number one and always will be. Now we are bored. Enough about me, why don’t you tell me what you think of me!” And finally it ends with, “Ugh, why bother?” The opposite of this sin is a firm belief in one’s offering, a willingness to deliver what’s promised and strength of conviction.

“That’s not my department” echoes in the halls of an organization that is has succumbed to this sin. These Sullen Pagans do not understand that functional silos are barriers to innovation, not just in brand marketing. In Driving Growth Through Innovation, Robert Tucker says that one of the reasons innovation has not become embedded as a key driver of growth and profitability in many organizations is because it has been limited by functional and divisional silos within companies. The responsibility for innovation has been limited to R&D or senior level Strategic Planning Pagans who do not feel it necessary to speak to, let alone share ideas with others. I find it fascinating that functional silos are a bi-product of the Quality Movement. Today, thanks to ISO9000 and the like, quality is everyone’s responsibility. This needs to be the goal for innovation and brand stewardship as well.

Advertising can be summed up in one word: impotence. No amount of advertising is going to have the psychological impact today that it did on previous generations. It doesn’t have the same function it used to and yet is still purchased by brand owners in exchange for the false hope of cultural relevance. If advertising worked like it used to, two well-known Bankrupt Pagans would still be recovering from the pulled muscle they got when high-fiving their agency partner for successfully copying a competitors “celebutant” television campaign (because they would have raked in cash). Mervyn’s and Linens ‘N Things long enjoyed high top-of-mind awareness, but apparently never got the memo: awareness no longer creates preference. Preference lives in the human heart, where brand matters most. If advertising worked like it used to, two well-known Bankrupt Pagans would still be recovering from the pulled muscle they got when high-fiving their agency partner for successfully copying a competitors “celebutant” television campaign (because they would have raked in cash). Mervyn’s and Linens ‘N Things long enjoyed high top-of-mind awareness, but apparently never got the memo: awareness no longer creates preference. Preference lives in the human heart, where brand matters most.

Girls Gone Wild Apparel, Humane Society Dog Lovers Wine Club, Diet Cherry Vanilla Dr. Pepper, and my favorite as listed on Brandweek, Hooters Energy Drink. There is a special place in Hell for the avarice and the fraudulent, regardless of whether they are malicious or just confused. Egad!

This sin belongs to the Short-term Gluttons who are quick to reduce prices in order make the sales number look good on their watch, so they get their bonus. They already have their eyes on the door, not long-term brand success. The mistakes that kill brands are the mistakes you sometimes never realize you’ve made. And when you do realize them, sometimes it’s too late. Unless you are the low-cost producer, you cannot sustain your brand on price cuts and discounts. In fact, companies frequently cause irreparable damage to their brands by discounting. Consumers will pay more if they feel they receive an added benefit or value with the higher price—even in a recession.

Decision by committee is often an exercise in mediocrity. Not standing up for a single, ownable position is pretty common business practice today. Trying to please everyone will result in creating a brand nobody will hate (vs. a brand people will love). If you work in a culture where you may get your head chewed off by your management team for not using a traditional laddering model or the appropriate shade of navy blue on your PowerPoint deck, then standing up for a radical new idea isn’t likely to be considered an asset. Bad news: unless you want to just put in your time on the mediocrity train, then you may wish to consider your options (while you still have them).

We all use them and hide behind them. Afterall, nobody ever lost his or her job for mentioning David Aaker’s Brand Personality Scale to help demonstrate the case for change. And where would we be without the Brand Pyramid? In Strategic Brand Management, Kevin Lane Keller’s pyramid reminds me of Dante’s gates of Hell– while I am captivated (and a bit frightened) by the inscription, I know that true understanding of it lies in the netherworld below. And you guessed it, a guru called Brand Architect has tackled Below The Pyramid. It’s really a great example of virtuous marketing pagan adding to the buzzword stew.

Bottom Line

Marketing guru-ism without an actual business objective (where your job is on the line) is really only theory. I am tired of theory. I want visceral creative, human communication. And this, thank Goodness, is why you, Dear Reader, hire people like me.

David Lemley

David was two decades into a design career with a wall full of shiny awards and a portfolio of clients including Nordstrom, Starbucks, Nintendo, and REI. His rocket trajectory veered when his oldest child faced a health challenge of indeterminate origin. Hundreds of research hours later, David identified food allergy as the issue and convinced skeptical medical professionals caring for his child. Since that experience, David and Retail Voodoo have been on a mission to create a cleaner, healthier, more sustainable food system for all.

Connect with David