Clear Defendable Territory

Week #05

You are called in to perform a pre-mortem on your brand...
Week #05

You predict the cause of death will come from...

That’s it. The shutters are coming down. The dream is over. Rip as much copper wire out of the walls as you can carry and get the hell out before the bailiffs arrive. We’ll always have Skegness.

But where did it all go wrong? Surely someone important saw this coming from up there in that ivory tower. Well, like the Enron shaped elephant in the room, people rarely face up to the decline of their brand until it’s too late.

Matching Lamborghinis were a tad excessive
Ironically, unless you’re a bank, the ultimate cause of brands failing tends to be financial. Your FD got in deep with the mob. You developed a Ming vase habit. Tulip mania. In short, you ran out of cash – and when the money runs out, businesses die.

But in truth, the writing is usually on the wall long before the money dries up. Most brands fail because, for one reason or another, they’re no longer important to people. One minute you’re Blockbuster Video, king of all you survey, understocking the latest must-see films and charging late return fees at your whim. Then bam! Netflix have you in a choke hold and you’re yesterday’s news. You're straight to DVD.

As much as we’d like to think brands occupy an untouchable emotional space in people’s minds, engendering religious-like loyalty – people are fickle. They will drop you faster than you can say ‘Wow, what a difference’.

You need to stay relevant.

What goes around
All brands go through a lifecycle – from start up, to growth, maturity, (hopefully) iconic status and then decline. What happens next is either rejuvenation and regrowth, or total failure. The brands that make it are those that move with the times. They never stand still and always look for a better way forward, keeping customers at the heart of their offer.

But so many brands do eventually fail. They stop being relevant. More than half of FTSE 100 companies in 1999 had disappeared from the listing by 2015, either through failure, decline, or being purchased. Brands – especially market leaders – become complacent and defensive, favouring the status quo and protecting the golden goose at all costs. They fail to see existential threats in their periphery, whether that’s hungry competitors, better technologies, or just general customer apathy. Failing to be progressive leads to irrelevance and eventual decline – sometimes of brands who seemed too big to fail.

That awkward (Kodak) moment
Founded in 1880, Kodak was a pioneer of innovation in its heyday. But when they invented the digital camera in 1975, they saw a vision of mankind’s brilliant future of selfies and it terrified them. Seeing it as a threat to their photographic film products (they held a 90% share of the US film market in 1975) they buried their invention deep where they hoped no one would ever find it. Sadly, they chose a time capsule scheduled to be dug up in the 1990s.

They had failed to imagine a world where people en masse wouldn’t want to use physical film. Relinquishing their digital first-mover advantage, they were playing catch up by the time digital photography began to take off. And as digital cameras and then smartphones became the norm, Kodak – like HMV and Woolworths later would – paid the price of their inability to move with the times and give people what they want.

A second bite
In 1997, Apple were becoming irrelevant and on the brink. And then Steve Jobs returned. They went on to release a swathe of innovations that changed how the world looks today, landing themselves with more cash than the U.S. Government. It was an incredible reinvention of the brand. But now Apple feels like it’s in protection mode. Macbooks and iPads don’t feel like they’ve moved on much in years and other companies have taken up their mantle as Innovators-In-Chief. Apple are in danger of being out Appled. It seems unthinkable that one of the world’s most valuable brands would fail. But talk to Kodak.

Meet your new robot overlords
Technology is often touted as the reason brands fail. And true, technology is set to change much of how we live and work with people in every industry feeling the deadly impact of AI, VR, AR and other such acronyms. But it presents an opportunity as much as a threat. A brand’s success or failure is not just about innovating new products or using ever more tech. Plenty of companies hock the same ugly wares for years and do well out of it (thank you very much). Others create lines of new products and sub-brands, spreading themselves so thin until people forget or stop caring what they stood for in the first place. There’s only so many blades you can put on a razor before people call you out. The brands that will succeed in a future awash with new technologies will be those that become or remain relevant to people as times change – whether that demands using a highly-engineered solution or not.

Change is constant
So how do you avoid the pitfalls? While change is inevitable and those who move with it will thrive, a cursory glance at the longest continually running companies may help. Meeting a relatively basic human need seems to work. The world's oldest company is Kongō Gumi – a Japanese construction firm. And it’s no coincidence that pubs, hotels, wine merchants and breweries, dominate among the world’s oldest.

Culture goes a long way to determining the success of brands too. Giving employees an active role in the brand welcomes innovation and means that management aren’t insulated from reality. Objectivity is key. If brands are able to see their world from an outsider's perspective, they stand a better chance of surviving.

And those brands with a definitive point of view – a purpose higher than just making money – tend to fare better. They’re less phased by change and meet challenges head on. They instinctively know how to solve problems, because they have a common purpose – one that gives them conviction and gets people pulling in the same direction. As times change, their point of view may not be popular with everyone, but at least they will avoid becoming boring.

At the heart of most brand failures, it feels like there is a cultural failure. Myopia, fear and resistance to change eat great brands from the inside out. They forget that being interesting, relevant and moving with the times was how they became successful in the first place. And ultimately, they forget who they’re doing it for.

The O’Jays knew what they were talking about.



What are Wild Cards?

The Clearing have been working with The School of Life to develop 100 questions designed to help you see your brand from new perspectives. We think great conversations begin with a great question. Each week, we’ll share another question and our response to it. Email us with your own answers on – we’d love to know what you think.