When a brand has backed itself into a corner in consumers’ minds, often the internal team is the last to wake up and smell the coffee.
It’s painful to realize that the brand has been disrupted by changing marketplace conditions, that competitors have taken root, that buyers have moved on. At that point, there may no longer be a way for the brand to keep the promises it once stood for.
So it’s time for the marketing team and company leadership to collectively recognize what’s happening and why — and to chart a path forward.
How to Recognize the Symptoms of a Dying Brand
We’ve counseled troubled brands, and they come to us with any number of problems: loss of market share, loss of shelf space, loss of confidence from retail buyers and consumers, pricing pressure, commoditization, private label knock-offs, and more. The common denominator of these challenges is that consumers have found a product that’s new and trendy, or cheaper, or better suited to their lives, or more aligned with their values. The brand isn’t relevant anymore.
It’s easy to recognize the key factors contributing to the brand’s demise. Maybe it has been slow to respond to changing marketplace conditions, like new sales channels and shifts in the ways consumers find and purchase its products. New, better-funded, well-organized, or just hungrier competitors have entered the market. Perhaps the brand team has flat-out missed the evolving consumer preferences and lifestyle megatrends that changed perception of the brand. Or the leadership team is simply stuck — or arrogant — and unable to change with the times.
Do any of these scenarios feel familiar to you, perhaps painfully so?
You’re not alone. We find that marketing executives are often the first to recognize the symptoms. You see the signs because your job depends on watching the market and deeply understanding how consumers engage with your brand. While your ownership may not be paying attention to those details, you see the evidence first, and you know its implications.
What Marketers Can Do About Challenged Brands
This is a hard position to be in. You recognize what’s happening, fear the repercussions that may be coming your way, and worry about what’s next.
When a CMO of a troubled brand comes to us for help, she’s facing a very short window in which to execute a radical fix. The marketing staff is usually in disarray. And she’s also the bearer of bad news to the rest of the C-suite.
Having that conversation with your founder/owner and leadership team can be brutal. We get it: You’ve built relationships with these colleagues, you’ve talked about fears and dreams and ambitions, you’ve shared victories. Telling them, in as frank and loving terms as possible, that the ship is going down and that drastic measures are needed can be an abrupt wake-up call that they don’t want to hear. Your owner is likely to be embarrassed and deeply skeptical, because the business isn’t just business for him; it’s personal.
Because of those connections to each other and to the product, we know that your leadership has lost perspective, making it difficult for you to identify a cure for the illness plaguing your brand. We can bring that outside, neutral point of view to finding the right prescription.
It’s essential to be as objective and data-driven as possible when dealing with a lagging brand. Several years ago, we worked with a troubled, family-owned founder/owner retail company that sold a majority stake to a private equity firm. The newly installed president came to us for guidance because a competitor was unraveling their business. We presented data that made an irrefutable case for rebranding the company, overcoming internal resistance, and mapping a path to future growth. You have to use data in order to gain buy-in to create radical change.
Two Potential Outcomes for Lagging Brands
If the company is truly out of options and the founder is ready to get out, then the logical option may be to close or sell at a deep discount to an investor willing to fund significant changes to the business. It takes a lot of character to admit it’s time to move on.
But not every ill brand must die; it’s possible to build something new out of the ashes. Here’s an example: Not long ago, we worked with an ingredient company that sold both directly to consumers and to food manufacturers. Commoditization of its core product had caused significant loss in total revenue, and when we stepped in, the business and the brand were running on fumes.
We gathered tons of data and conducted interviews with leaders and trusted external partners to identify the brand’s deep DNA. We held an innovation workshop and showed them where their capabilities and passion and expertise could get them — opening their eyes to new possibilities. We killed the old brand and established a new holding company with two new independent units (one B2C and one B2B) and related brands. In this case, the best option was to reboot rather than close or sell.
As you’re considering a way forward for your troubled brand, know that it will take unwavering commitment from your leadership team. In the throes of reinvention, we find that executives are prone to second-guessing and foot-dragging. We’ll make sure you stay on track. We can help your team understand your brand’s place in a shifting market, identify the best outcome, and then use data as a compass to find the way forward.
