I’m on bended knee and it hurts. The marble pushes into my skin, the organ’s pipes rumble deeply. I can feel them vibrating inside me. I feel like I’ve swallowed an Oral B toothbrush with the button jammed on.
The music rises and falls, emotionally manipulating my very soul. I’m lulled into the swinging sing-song of a 500 year old Hymn…Onward Christian soldiers, Marching as to War….I feel a tear welling up in my eyes. The beauty, the majesty, the bullshit, so wonderfully sold. I snap out of it and look up at her.
She doesn’t notice me. She’s distant. She stares vacant, over my head. Surveying her assembled, humbled masses with an unfocussed eye, dreamy. Her nose is small and delicate, her fingers light and creative, her brow unwrinkled, her eyes blue and clear. No hard nights for her. No worries. No fears. No movement for that matter. A cold statue. Just a bit of dust and glue whacked together in the shape of a young woman.
She’s porcelain, lacquered. Perfect. Pristine. Untouched by human hands (sure – who made her?) Unsullied. The perfect woman. A virgin. And yet, somehow, miraculously you might say, she’s also a mother – neatly covering both bases…the need for chastity meets the need for procreation, the continuation of the species….how perfect, how improbable..
Isn’t this, the Madonna, she who dominates so many Churches throughout the world, the Virgin, the perfect brand? Like many things to do with the twisted English, it’s all about promise, without much delivery. What exactly can a Virgin do for a real bloke without changing her status (her core brand message) instantly and forever?
I go to so many meetings where the brand they hold up that they want to be like is Virgin. They say ‘can’t we be another Virgin?’ As if it’s as easy as being just another mother with three screaming kids and a mortgage.
Yet is Virgin the perfect brand? Is it bullet-proof? Is it the unassailable, the brilliant, the heavenly sent brand it’s purported to be?
Can Virgin get anything wrong? It’s launched shops, records, airlines, credit cards, how fantastic. How brilliant are the marketers that run Virgin. Can they not get anything wrong?
But what about Virgin Cola? Failed there. Virgin Vodka? Failure. What about Jeans? Failed there…
The point is even the best can get it wrong. Even the best can fail with brand extensions. This article is about how to launch new products launched under the banner of the existing, successful brand, and not stuff it up. Like don’t associate someone like Pammy, who is, let’s face it, not exactly virginal, (have you seen the email clips?) with a brand like Virgin. Good mix? Nup, big boo-boo there, Sir Dick.
But lets first look at why roll out brand extensions, the pitfalls, the opportunities.
Make Money
Let’s not mince words. This is about quick, dumb money. It’s easy-buck territory for marketers and boards. Everyone says, ‘Hey why don’t we launch a sister brand? We can trade off the good name of our big cash spinner and make even more money with no risk! Aren’t we smart business people?’
But how easy is it really? If you go into a fight thinking it’s going to be a cake-walk, invariably you get it in the nose.
Are there not competitors? Don’t they have marketing budgets? Don’t they employ public relations people to put an alternative spin? Don’t they talk to your retailers, distributors too? Don’t they spend nights lying awake, thinking up strategies or my favorite, sticking pins into little dolls that look like you?
There are many examples of how this obvious, easy-sounding exercise fails. Our research (yes, we always research these articles, believe it or not) found some 30,000 new SKU’s get launched in the US each year, (couldn’t find figures for OZ, if you know them, send them in) and the vast majority are brand extensions. Fewer than 25% of those are listed as successes by their owners.
So you have a one in four chance of getting it right. Better than some product launches, but only just. For something you’d reckon was going to be a walk in the park?
What do people do wrong? How or why do these launches fail?
Weak Market opportunities
Just because you think a launch would look good on your CV this year doesn’t mean this product is wanted by the public or your retailers. Most of the failures seem to have occurred because the wish for a company to run another product line is out of touch with the market’s needs. The public has no desire to get a Widget B to do X. They are perfectly happy having other brands do that for them. Especially not where Widget B model had nothing much to do with the core brand values of Widget A.
Poor research
Everything successful starts with research. Any new product deserves the same depth of research as you’d expect to put in to a major launch. If you’re using the wrong approach, if you don’t want to listen to the findings, if you’ve hired the wrong researchers (NB. they are the researchers who don’t tell you like it is, but tell you what you want to hear) if you don’t truly understand your core brand values or you have done the new packaging, brand messaging, channel or whatever research too late, or interpreted it too positively, you risk hitting the wall.
Over-stretched associations
Most of the failures come from an assumption that this product has something to do with the original one’s values. And most of the time they don’t. What the hell do Dunhill Pens have to do with Dunhill Cigarettes? The same basic shape? If that works, I ought to launch my own brand of potato.
Low budgets
So many companies think a brand extension is an opportunity to shave normal launch ad and PR budgets. In some wonderful cases, you do get carried along on the wings of the public’s love for your original brand. But they are few and far between and most of the time you get recognition, brand personality association, but you don’t necessarily get ‘reason to buy’.
Please understand this – you are just getting a nudge from the old brand – you are not getting a totally free ride.
You must spend promotional dollars – convince your board to put the same kind of funding into the launch and on-going support of the new line as you would into a completely new product launch.
Lack of commitment
At the end of the day most fail because no-one really believes in them. You might, or your national sales manager might half believe in it, one or two retailers might run a promotion about it, but three months after the launch, there you are, wondering what went wrong. You must be 100% committed to the new line. You must give it a reason to be in its own right, it must fill a market niche of its own.
Sure, it gets a lot of help from the original brand – Landrover Socks ‘get better grip’ or ‘give you a smoother ride’ or whatever, but in the end they are just over-priced socks and are they warm and comfy?
Are you really proud of the idea? Does it work for the retailers? Can you flog it over the web for lower than normal retail costs? Does it work better than the competitors? Does anyone actually care about it?
No champions
Most often failure comes down to no-body being truly responsible. No one person with their balls on the line. Make any new product some body’s problem, and keep them accountable to it, and you’ll see way better results.
Poor Organisational Capacities
Often companies are operating at their maximum capacity in many areas – especially in times of full employment like now. Even if the marketing department can find a few extra hours between 7pm and 9pm, the truckies, the warehouse guys, the sales department girls, the accounts department dweebs, somebody drops the ball and the whole pack of cards falls over. Make sure you have capacity in all sections before you commit your whole organization to more work.
Upside
Line extensions are damn simple to sell to a board. So if you need something to do, or want to give your researcher mates a project, or your ad agency an easy ride, they are easy to get senior management support for.
But they do not become a brand unto themselves, so they are always under the cloud/wing of the original brand, they are always playing second-fiddle to a brand developed specifically for that niche in it’s own right.
What’s got more credibility when it comes to flying? A balsa wood kit plane from a family that’s been making wooden biplanes for 100 years, or the BP card-board enviro-biplane launched to promote BP’s green credentials?
They are also usually of less intrinsic asset value when it comes to a sale of the company, or for that matter commitment from your board, or your retailer channel partners. The brand sells for less when the company goes up for sale, because they are just one part of the bigger brand, not a brand in itself.
You have to ask yourself, what if we put the same effort into a brand that could exist in it’s own right that fitted that market gap? Would we do better over the long run if we launched an original brand instead? What does your professional marketer’s hat say to you about that? Are you just going along with the ride because the board suggested it? Or do you really think the public needs it in this form?
Cop-Out
I’m not anti-brand extensions, but I have to make the point that their launch invariably displays very little imagination – you are trading on the public’s perceptions of another brand. You are milking the cow of human kindness, not pushing the human race forwards.
Yawn
The reason most people don’t greet these product developments with enthusiasm (except the new little promotion agency who needs the work) is that they often demonstrate zero new thought. They add very little to the world’s intellectual space. They are therefore not remotely inspiring. The accountants on the board may think they are a great idea, but those guys think wearing a pink business shirt is living dangerously. You are potentially boring the world. The upside is that some of these products work very well. Cadbury’s Ice-cream tastes great. Caterpillar boots do look tough, do last well.
How To
Educate the board
They always think these launches are as easy as an against-the-wall screw with a recently-divorced drunken ex-squeeze at a wedding reception.
There are great risks attached, particularly in loss of face if it fails, and keep in mind most do. Take your time to do a presentation that covers both the advantages and the risks. Don’t be tempted to gloss over the problems – usually this gives you an opportunity to get more budget for the project anyway.
Choosing which way to jump
Most of the academic research discusses developing core brand values and testing their extension into other products using proxies or fake brands that emulate the possible new line. I guess they mean by that you should research what the public thinks of the idea, but who am I?
Create Guidelines
Regardless of which new product/extension you want to do, for whatever reason, it’s best before embarking on spending your shareholders hard-earned, to decide on and get agreement on a set of guidelines that could work across any associated product. Can it fit in our warehouse? Can we make it in OZ? etc.
Make sure the connection is right
Just cause it sounds like a good idea on paper does not make it work.
It should be very relevant IN THE CONSUMERS’ MIND (your’s doesn’t count). It should make sense to the public. It should sound exciting to the retailers and the target market. They ought to salivate. Not just say OK, but truly want it.
Value/brand add
The new product must add something to the original brand’s standing. And it should re-inforce both. Do Caterpillar boots reinforce the brand values of Caterpillar Dozers? I’m not sure. But I’ll tell you something for free – if they tore easily and only lasted a few weeks, they would definitely damage the perception that Caterpillars are an invincible machine.
Sell them through to partners properly
Go see your distributors with the baby almost finished (a few things still uncertain, location for info on pack, the TVC not yet finally cut, the media budget still not locked down or whatever story you can swing) for their input/comment on promotions, twin packs or whatever. It’s always important to ensure your channels are on-side, but even more-so when they are already carrying a few of your main lines.
Check damage reports regularly
Many new lines cause damage in channel relationships (we don’t have the space!), and with public perceptions of your capacity/brains etc. I recommend monthly tracking of major launches, at least.
Protect the Original Brand
Make sure that you are not putting all your efforts into the little sister brand and not the main cash cow. Protect your main brand with appropriate spend, with the normal amount of effort and make sure that the new product isn’t eating away at your main brand’s credibility. If it is, fix it somehow.
Spread the marketing budget
Of the launch and on-going campaigns across the whole range of products. I’ve seen some clowns expecting a new product to generate all it’s own money/cover it’s own costs, when it’s clearly promoting the original product as well – if you’ve got the same name and livery, surely you’re deeply connected from the public’s point of view. Make the old product carry some of the costs of the new. The new one is promoting the old one.
Give yourself a sensible pay-back period
Most big companies work on pay-backs of investment of 4-7 years, depending on the purchase category. You or your board can’t expect to be covering costs and reaping profits in six months. Treat this like any other investment and you won’t be disappointed and your board will be far less likely to be hounding you in a year.
Launch in similar media
If your core brand is always in women’s mags, shouldn’t your new one? It’s targeting exactly the same audience isn’t it?
Launch with similar budgets
If it’s going to be too little, too late, why bother? Make sure your team are armed properly or you’ll fail. Get adequate budgets for the task. Don’t expect miracles or favours from people just because it’s a bolt-on. Expect the reverse.
Expect a negative reaction, or a yawn
Most people are embarrassed to work on an obvious copy or addition to a brand mix, so much so that your ad agency will often want to launch it with something naff like say a sales promotion with it actually attached to the original product – you can see a Cadbury Dairy Milk Chocolate Bar glued to their new Cadbury Dairy Milk Ice-cream in the freezer can’t you? Do you think the agency put a lot of thought into that? Reckon the chief art director would have worked on that? Gone for an award? No, they would have got the work experience team to do that.
Try and try again.
If the first one’s a success, brilliant, you could do it all again next year. But if it’s a failure, so what? Same story. Richard Branson’s Virgin is not a success just because the brand’s values are right and they are a good organization when it comes down to the nitty-gritty. Virgin is a success mainly because they don’t give up. Sure, they have wins and losses and recognise a failure and move on. But they don’t stop launching and take off a few years to lick their wounds. They just keep launching. They learn a bit each time, but they are always there, punching away.
If you want to be a success in this life, it’s not whether you win each battle that counts, it’s going in there again and again and again. Bloody nose, broken arm, having another go anyway. The people with a real commitment to anything are those who stay in it and who eventually succeed.