Monthly Archives: October 2009

Resurrecting Brands: It’s Nostalgia, not Good Strategy

Some well-known brands disappear from the marketplace altogether.  GM retired Oldsmobile and is set to do the same to Saturn and Pontiac.  Hummer will meet the same fate if a buyer isn’t found soon. Kodak eliminated Kodachrome film, which was synonymous with photography for many generations.

Well-known brands from Studebaker to Commodore (remember the “first” PC for home users?), which played significant roles in lives of many families, are long gone.  Others like the 123 year old financial services brand Paine Webber have been acquired and renamed.  Eaton’s, once Canada’s largest department store chain founded, went bankrupt in 1999 after a 130-year run.

Why do some brands disappear? Here are the major causes:

  1. Losing Relevance.  Brands at times fail to keep up with changing consumer tastes and values.  Krispy Kreme, once the darling of Wall Street, is an example of a brand that has lost relevance.  It happened very quickly.  The company is still surviving, but the immense popularity of Atkins and other diets (low carbs) has hurt the brand badly.
  2. Unseated by New Technology. The digital revolution has hurt many brands. Kodachrome is an example.
  3. Superior Competition. Take the case of VW Beetle. Superior competition from the Japanese companies redefined the small car market. They incorporated features which offered greater value to the consumer.
  4. Losing Differentiation and Brand Identity. Some brands that have been around for very long tend to become stale and lose their differentiation.  This was the problem with many GM brands.  Brands like Buick, Pontiac and Oldsmobile were created to supposedly cater to different segments, but the drive for efficiency in operations (and some muddled thinking) led to multiple “look alike” brands.
  5. “Grandfather’s Brand” Syndrome.  Some brands simply don’t appeal to today’s youth because they are too closely associated with previous generations.
  6. Victim of M&A.  Paine Webber is not the only brand that went out of circulation after acquisition.  HP acquired outsourced IT service provider EDS, but has now abandoned the EDS brand name and calls its new division HP Enterprise Business. Compaq, once the largest PC manufacturer, has been mostly absorbed into HP with most of its sub-brands now featured with the HP name.  It is a greatly diminished brand, and will likely end up like EDS.

I have wondered what GM and others who own these dead brands will do with the trademark and whatever brand equity there is left in these brands? Is it worth resurrecting these once-famous brands in the future? In most cases, I would argue that it is not.

These iconic brands are part of a certain time and place in our history.  They meant something to those generations of consumers.  Many are part of the popular culture.  The new owner of the brand name will seldom be able to capture the old magic.  In the case of technology products or even food products, the old product itself will no longer be relevant or acceptable.  That means the old brand has to be used to dress up what is essentially a new or more contemporary product. This may not appeal to nostalgia seekers.  Even retro-style brands have a limited appeal.  Also, the history of past failure is a baggage that will continue to haunt the resurrected brand.

The old fashion or style has to come back in a big way to even consider brand resurrection as an option.  Until then these once-famous brands belong in museums and homes of memorabilia collectors.

Your thoughts and comments are welcome.