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Numerous brands have met with gradual decline and death
Managers must foresee the signs of Brand Decline and adopt approaches to revive the brand
• Popular post World War II for unique designs and engineering• Tough competition from smaller Japanese motorcycles in the 1970s• Countered this by introducing smaller vehicles • These were perceived to be of low quality
The case of Harley Davidson
And Voila! Today, it is one of the most recognised brands worldwide
Recognising its weaknesses, Harley Davidson invested in quality and styling
Brand decline is reversible
Reviving brands is more profitable and less risky than launching a new brand
PEC
Generative force -
Managerial activities
Mediative forces -
Competitors’ response to marketing initiatives
Selective forces -Market
Environment
Product Evolutionary Cycle (PEC)
Managerial actions
Product QualityPrice increasePrice CutsBrand NeglectInability to stay with target market
I. Product Quality
Cadillac’s steady decline over two decades was due to compromises in product quality
III. Price Cuts
Lacoste’s price cuts in response to falling demand proved to be disastrous
Lower prices
Cheaper Quality
Material
Lower Brand Image
IV. Brand Neglect
Nutritional product Ovaltine acquired by Sandoz in 1992
Neglected as it was not seen as a core brand of Sandoz
V. Inability to stay with target market
GAP’s shift of focus to the younger audience alienated its core customers, in the 1990s
Brand Equity is defined as “the differential effect that consumer brand knowledge has on the customers’ response to marketing activity”
Differential effect
Provide consumers with a compelling argument on why they should choose a particular brand
What makes the brand DIFFERENT from the rest?
While most brands can be revived, some may not be worth the effort
Pan Am was driven to death as a result of negative image in the aftermath of the Lockerbie bombing incident
Brand revitalization can be kick-started by addressing:
The causes of the decline Understanding the brand’s
promise and why it may have failed to deliver
Resist temptation to milk the brand
Apple introduced the iPod at just the right time, launching itself to the forefront after a lull
Pursue a carefully defined target market
Levis leveraged its brand name to promote its new line of business clothing. Once established, Levis removed its name and Dockers became a stand-alone brand.
• Managers need to identify signs of brand decline
• Managerial actions, environmental factors and competitive actions contribute to brand decline
• Brand decline is reversible• Brand revitalisation entails careful
repositioning of the brand, investment and educating the market
RECAP
Disclaimer:
These slides were created by Anju Joseph, MEC Kochi, as part of an internship done under the guidance of Prof. Sameer Mathur, IIM Lucknow
(www.IIMInternship.com)