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March 23, 2012

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Brand marketing fraught with pitfalls

MARKETING is a risky business. Every year the marketplace is littered with brands that fail miserably. Some fall from past grace; some go belly up barely after launch. It is rare that people get to look up and hail the glorious dawn of a blockbuster brand.

Yes, competition is ruthless. Ever since the supermarket shelves became row after row of products with little differences, the fate for most brands has been rather dim.

Yet, is competition really the culprit of most failures?

After witnessing the rises and, much more frequently, the falls of brands, and being personally responsible for some of the failures and, luckily, successes, we believe firmly that the answer is no.

The blame, in most cases, rests squarely on marketers themselves. With so much marketing literature and so many case studies available, it is surprising that so many failures are attributable to simple and common pitfalls in marketing strategy. Below are some of the more common:

Self-centric

Consumer centricity has been in fashion in recent years. Many consumer-goods companies installed programs and policies with the intention of ensuring that their staffs adopt a consumer-centric perspective. The result? While a few probably have benefited, the majority merely paid lip service.

Instead of consumer-centric, many companies are actually self-centric, or even boss-centric. A major eye-care brand has languished in China and barely scratched the surface after some 20 years in operation. A peek into the critical insight in the category quickly identified a misalignment between the brand's positioning strategy and the category triggers and barriers among Chinese consumers.

This finding made sense to the local marketing team. But what happened afterwards? The company's regional team simply ignored the China team's suggestion and dictated the strategy for yet another year.

After entering China five years ago, a major weight-management company has incurred large losses and is still searching for the right China strategy. The company's initial strategy of focusing on young, white-collar females actually seemed to have gained traction at the beginning, with customers exhibiting high satisfaction and some service centers reaching break-even point.

Yet that strategy was scrapped, largely because the folks back at headquarters believed that their strategy of focusing on anyone with weight problems back in the home market should also work in China.

As such, a strategy review and market research studies were commissioned to assess the potential with males, kids and the elderly.

When fresh evidences against such a broad targeting strategy were produced, the management simply discredited them and ordered yet another round of review and research. Now five years on, competitors have flourished, while the company has watched its market presence shrink.

Falling for buzzwords

If one spends just one night hopping from channel to channel and watching all the TV commercials, he or she would know all the hottest buzzwords of the moment.

What's hot at moment? Organic, green, LOHAS (lifestyles of health and sustainability), and self-expression. The zealot marketers penchant for buzzwords makes one wonder whether marketing strategy has been hijacked by the latest buzz in town.

Take the buzzword "health" as an example. A quick scan would identify the following brands boasting about their healthiness: a fast-food chain named KFC and a potato chip produced by Orion.

Take the buzzword "green" as another example. Several years ago, Prince, a brand beloved by children and adults alike for its chocolaty sandwich biscuits and the figure of prince, also went green. Prince was featured in TV shows and at public relations events under the banner: "Saving the earth with Prince!"

The result? Core brand users found it difficult to relate to the brand, and other users were not given a good reason why they should eat Prince. After several years of disappointing results, Kraft repositioned Prince as a companion for kids, with the Prince figure enlivening the childhood fantasy of fighting evils in cartoons and computer games. As a result, Prince has been enjoying fast growth since the change.

Wishful thinking

It is a human foible to replace reality with wishes. Companies are no different. Very often, a desired result becomes the strategy.

Over the years, we have heard many mandates when working on brand strategy. Here are some examples:

- A vegetable protein beverage brand dictated that whatever their new brand strategy would look like, it would have to grab market share from milk simply because the milk category is huge. This decision was changed only after convincing evidence that milk was almost inconvincible at its own game and that the company's products actually appealed to domains where milk did not play a role.

- A snack company invested heavily to push their products onto the consumer breakfast table. Why? Because their product had the lowest penetration into the breakfast market. New products subsequently launched to target breakfast did not perform well, and in reality, might have diluted the image of the snack brand itself.

- It is even more common for brand owners to demand that new products absolutely should not cannibalize existing cash cows. Kodak certainly can be counted among the most sincere believers of that philosophy.

Certainly, there are many other pitfalls in devising marketing strategy.

Yet, regardless of what the pitfalls might look like, they all share the same middle name: "ignorance of the consumer truth."

In all of the cases mentioned, failures could have been prevented if the companies simply showed a bit more respect for what consumers were thinking.

Regardless of the symptoms, a large dose of consumer truth and a small amount of common sense could avoid many marketing pitfalls without much effort.

Paul Zhou is Managing Director of The Illuminera Group, a group of insight and marketing strategy companies. Eric Wang is a veteran marketer and currently China head of marketing for a leading consumer goods company.




 

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