When brands become obsolete

The Economist reports on the decline of America’s leading newspapers. Venerable titles like The New York Times are apparently showing decline in both readership and advertising revenues. The story is similar across several newspaper titles. Much of this decline is being blamed on the rise of the internet, which offers free, round-the-clock coverage, and which has provided a new, better home for classified advertising, once the bedrock of most newspapers’ revenue. The report also talks about the rising popularity of web-only brands like Huffington Post. However not all brands in the category are facing a downturn. Local newspapers are innovating and brands like Wall Street Journal (recently bought over by Rupert Murdoch) and Philadephia Inquirer are showing signs of growth. I also feel that web-only brands like Newsvine, which allow the user greater control on what he would like to read, have a huge potential in the future. Back home, the IRS 2008 Round 1 reports of marginal declines in readership of English dailies. But the topic of this post is not about declining readership. It made me think about brands reinventing themselves to suit changing consumer trends.

Why do brands become obsolete? All of us can think of brands that were once popular but are dead now. Some categories too have disappeared due to technological changes and changing consumer preferences.

Whatever happened to…?

Pagers were once hailed as the cheaper option to mobile phones. I remember mobile calls being in the range of Rs.15/- per minute and handsets the size of small weapons. Pagers were then useful for doctors, sales force and such like. The economies of the mobile phone industry changed and that put paid to the usefulness of pagers.

Zip Telecom used to be a highly visible brand in India, offering STD calls and an alternate advertising medium through the handsets. The Zip Phone, the propriety product of Zip Telecom, was a state-of-the-art pay phone device that combined the display attributes of a television with the internal functioning of a computer, and included internet and credit card compatibility. At one time it had around 25,000 machines installed across the country. But decrease in STD rates, internet & PC penetration made the brand obsolete.

Satyam’s iWay was a pioneer in the broadband interent cafe space. It provided an alternative to the slow dial up service and mushroomed all across India. Then again, the increasing penetration of Home & Office PC’s with broadband made the iWay offering less attractive, atleast in metros. One would expect a broadband cafe to be buzzing with activity – on a recent visit to an iWay outlet I saw bored employees, cobwebs and a general air of sluggishness. They seem to be on a path of re-invention by converting the outlets into hubs fro train & bus bookings, games and training of housewives on internet usage.

Reliance’s WebWorld too offered a great alternative to dial up service at one time. It also used to be a gaming hub. Now they are offering video conferencing services to individuals and small businesses. Large corporate houses ar today conducting online meetings and interviews through video conferencing. When those facilities become affordable for smaller companies, WebWorld may have to reinvent itself. The other day at a WebWorld outlet I saw a training course being conducted for a group of 10-12 individuals on document management. So the brand is attempting to reinvent itself in keeping with consumer trends.

Archies was once synonymous with greeting cards in India and even forced ITC to consider entering the category with Expressions (for backward integration with their paper business). Changing consumer attitudes and growth of e-greetings and SMS have forced them to rejig their business model into a gifting brand. They have gone on to launch a fashion accessories brand.

There are umpteen examples of brands & categories being in a position to offer a timeless benefit but fail to do so. Vicco Vajradanti, Chyawanprash, VHS tapes come to mind. Yet there are brands that reinvent themselves to offer new benefits. With the advent of email, everyone predicted the death of the printer. But the consumer still saw a need for them and the industry is flourishing.

Changing consumer or changing categories?

The trick is in figuring out changing consumer trends and preferences and rejuvenate the brand accordingly. Brand’s become obsolete due to a combination of various factors. A brand can be defined as a set of images & perceptions that a consumer has. If those perceptions are not in keeping with the changing consumer, the brand could be obsolete. HMT watches comes to mind as an example. An interesting analysis of why HMT failed against Titan is here. It appears that HMT failed to convert its perceived weakness of a mechanical watch into a strength. It also failed to keep pace with the changing consumer trends by not projecting a modern, attractive imagery through product innovation, advertising, merchandising etc.

Polaroid is another brand that once stood for instant photography. Changes in the digital photography medium amde that promise irrelevant. Similarly with Kodak photographic film. Both these had to find newer ways to sustain the business.

Some brands are closely associated with a category. But due to technolgical changes the categories disappear and with it, the brand. For example, Sony’s Discman or Walkman was synonymous with music on the go. But when CD’s and cassettes gave way to digital music, they were no longer relevant. They also did not spot the trend and let Apple cream the market with an offering that allowed digital music ‘on the go’ (you must’ve heard of the iPod?). Smith-Corona was once linked closely with typewriters. But the advent of PC’s made the cateogy obsolete. Would a Smith-Corona PC have succeeded? Maybe not. But the company could have eased the brand away and launched a range of PC’s with a new name.

Some brands manage to straddle a variety of categories even if they are strongly linked to one category. Godrej, for example is brand of locks and a DVD player.

Google,  is a great example of defining rightly what they stand for and evolving over time to suit the consumer needs. Google’s mission is “to organize the world’s information …. and make it universally accessible and useful”. Google explains that it believes that the most effective, and ultimately the most profitable, way to accomplish our mission is to put the needs of our users first. In a fantastically written piece on their philosophy, Google explains the ‘Ten Things’ that they believe in. They could have limited to being an ‘online search engine’ brand but a clear focus on the real business they are in allows them to reinvent the brand to suit the varying consumer needs – be it research, video & image sharing, advertising or Google Earth.

In an interesting debate on why brands die, Brandchannel offers two schools of thought: (a) mismanagement kills brands, not time and (b) time not only ages all brand identities, but kills them too. In my opinion it is people who kill brands. The brand management team and the advertising agency are collectively responsible for keeping pace with consumer needs, irrespective of time. They need to constantly tweak the brand offering and keep it relevant. Advertising legend Jim Mullen says, “Of all the things that your company owns, brands are far and away the most important and the toughest. Founders die. Factories burn down. Machinery wears out. Inventories get depleted. Technology becomes obsolete. Brand loyalty is the only sound foundation on which business leaders can build enduring, profitable growth.”

So, brands don’t die, they get killed! What say?