Dave Murray

The Dangers of Bad Brand Strategy

Readers of my other blog posts might know the mission of Mayniax Branding. They may even be able to recite it, themselves. Come on, say it with me: “Our job is to give gutsy business owners and entrepreneurs a shot at better lives by branding the hell out of their businesses.” Ahh, that felt good to type. But, what happens when an entrepreneur or business owner doesn’t know much about branding or brand strategy? Or worse, what if they think they don’t need to know anything about it?

I recently had my first meeting as a member of a marketing committee, where there was talk of adding two brands to three existing, and struggling, brands. It quickly became apparent these people were ignorant to the ways of the branding arts. They were focused on the wrong things, and worse, could only suggest things to the real powers-that-be, rather than make any changes themselves. I felt bad for them, because I’ve seen this movie before. They’re screwed, and I can’t save them.

When the top people don’t understand brand strategy, bad things happen. Sometimes, it’s a simple case of brand extension causing employees to work harder on more brands with the same resources. This puts unneeded stress on employees, and results in one or more of them quitting for greener pastures.

Sometimes, however, it’s a whole lot worse.

Ya Hate a Bad Apple

Gil Amelio, the man Steve Jobs replaced shortly after going back to Apple, knew a little bit about strategy. Brought in as a turn-around expert, Amelio realized one of Apple’s problems was that the company had lost its focus. And, in an effort to re-focus, thousands of people were fired. The sad reality is, for the sake of Apple, that was the right move.

I have to think the previous regime didn’t set out to fire thousands of people, but their ignorance of brand strategy caused it to happen. They tried getting into too many markets with products that Steve Jobs once remarked as having “…no sex in them…” When Jobs came back, in order to really focus Apple, even more product lines were cut. And again, the sad reality is, for the sake of Apple, that was the right move.

Microsoft and Nokia

On April 25, 2014, Microsoft bought Nokia. In July of 2014, Microsoft laid off 13,000 people. In September of 2014, Microsoft laid off another 2,100. And the majority of those 15,100 employees were Nokia workers. So, what the crap happened?

Satya Nadella, the current C.E.O. of Microsoft, happened. Specifically, his “…vision of a leaner, meaner Microsoft” – which, if true, is a good brand strategy move – happened. Just as Amelio and Jobs had to re-focus Apple by cutting thousands of employees, so too did Nadella with Microsoft. It obviously sucks for those thousands of people who got pink slips, simply because the former C.E.O.s – one of whom was Bill Gates – didn’t know about brand strategy.

A Ringless Saturn

Since 1959, General Motors has had problems with brand strategy. They seem to have that “but we’ve always done it this way” culture that impedes innovation. And because of that, 2,000 workers in Spring Hill, Tennessee were laid off.

Saturn had become a powerful brand all its own, with a “…unique power train, its polymer body panels that didn’t dent or rust, its sand-cast aluminum engine block and its no hassle, no dickering retail sales experience…” General Motors and the U.A.W. disapproved of Saturn people not thinking of “…themselves as G.M. Subordinates or as U.A.W. card carriers,” and proceeded to destroy everything that differentiated Saturn from other G.M. brands, until all their vehicles were just like all General Motors vehicles: the same vehicles with different nameplates.

In Conclusion, Class…

Apple and Microsoft ended up having to fire thousands of people because of brand expansion – putting their names on too many products in too many markets, which made it so neither brand stayed in the minds of potential customers. Thousands were fired from Saturn because G.M. didn’t understand just how important differentiation is in the marketplace. And in all three cases, ignorance led to tragedy.

Entrepreneurs, business owners, and C.E.O.s can destroy careers, lives, and even towns, simply because they’re ignorant to brand strategy. Or, they can talk to branding experts, and be heroes.

Which one are you?

Stay gutsy, gang!

Sources
Low End Mac: Gil Amelio fires thousands, Steve Jobs Returns.
Tech Times: Satya Nadella wants “…a leaner, meaner Microsoft.”
Forbes: General Motors halts Saturn’s differentiation
Slate: 2,000 people fired from Saturn.