Sears, Woolworth’s, Radio Shack, Campbell’s Soup, Kellogg’s, Kmart, Toys “R” Us, Howard Johnson’s, Kodak, Xerox…
These are just some of the American icons that are dying or dead.
Do brands live an inevitable, natural lifecycle from birth to growth to maturity to decline to death? No. Brands can live forever, if properly managed.
On March 8 came reports that the bankrupt U.S. division of Toys “R” Us is preparing to liquidate, according to people close to the matter.
Another once-mighty retailer, Sears, is also in a dire situation.
In an article by Sarah Halzack of Bloomberg Gadfly, she describes the sorry situation at Sears. The subtitle is Dead Store Walking. Halzack recounts how the “death watch” at Sears is now something of a sport among retail observers and analysts.
For six years, Sears’ trajectory has been on the downslide. Every announcement from the brand indicates that the next tactic, or sale, or cash infusion is what will be the silver bullet of revitalization.
However, as Bloomberg Gadfly points out, all of the actions taken or about to be taken are happening on the edges, and have no hope of saving the brand. For example, selling Kenmore products on Amazon is just another reason for not going into the physical Sears store.
And, if you have been in a Sears store recently, you may count not having to enter a Sears store as a blessing. It is no longer a question of whether Sears’ death is on the horizon; it is a question of when.
Hovering over Sears bleeding body is J.C. Penney, which has made it clear that it intends to siphon off Sears market share by investing in appliance sales. As Penney CEO Marvin Ellison said, ” We’re going after Sears and we’re going after market share that we think is going to be available not only now but as they continue to contract.”
This is so sad. The brand is part of American lore. Established in 1893, the original Sears, Roebuck and Co., changed the way people bought products by offering an innovative service: “Send No Money.”
Sears advertised that you could “buy, buy, buy” but did not have to send the money. You only paid when what you ordered arrived at your door. This policy was heavily advertised. It fueled the firm and made the Sears, Roebuck and Co. catalogue a household mainstay. The Sears catalogue was the American precursor to today’s Amazon. You can buy what you want without having to go to the store. Sears should have been the leader in online retail.
Sears is an ideal example of a brand that, if properly managed, could and should live forever. Instead this massively mismanaged brand finds itself a few steps from the grave. Sears is not alone, unfortunately.
And then there is Xerox, the brand so identified with photocopying that it became a verb. While Xerox defended the status quo in photocopying, it lost its dominance to Asian brands. Now Xerox is considering a life-saving merger with Fujifilm.
Fujifilm is a brand that actually reengineered itself. Unlike Kodak, Fujifilm saw the writing on the wall for its photographic film business. Fujifilm noticed that the gelatin used in film comes from collagen. Collagen is a powerful ingredient in anti-aging skin care. The company used its knowledge of the science of film production to develop a skincare line that is close to a $100 million dollar business.
Following in this direction, Fujifilm is seeing the potential of the science of film in developing Ebola drugs, anti-aging potions, and stem cell research — the science of health care. The company rerouted itself to science and subsequently revitalized its business.
While Fujifilm was reinventing itself, Kodak, its rival, fell deeper into brand malaise. After emerging from bankruptcy, Kodak invested in digital printing and packaging while keeping its iconic film business barely alive. None of its strategies worked.
Recently Kodak announced that it was getting into the Blockchain business whereby photographers can better manage their intellectual property online. Kodak’s share price spiked but relative to where it used to be, and relative to the Russell 2000, it is a ghost of its past.
Observers are concerned that this foray into the crypto business is just a side event, a business around the edges, like Sears’ selling on Amazon. Kodak is in severe decline. Rather than using insightful management to evolve its business, as Fujifilm did, Kodak is still stranded with a legacy business that is quickly losing viability.
Fixing brands — iconic or otherwise — needs brilliant brand management. Financial gymnastics, and/or non-core, tangential efforts are not the answers. KFC turned around due to excellent marketing with a focused re-emphasis on its core products.
Nissan turned around through operational excellence and a focus on making the brand mean something again.
There are rules for brand revitalization. When brands go into decline, some executives see these brands as cash cows to be milked for other opportunities. When a brand owner or leader starts to see the brand as a cash cow or an entity ripe for financial finagling, the brand is on the way down the drain.
The market-leading Sears is on the road to the brand cemetery. The dominant Xerox that became a verb is no longer an innovator. When faith in brand evaporates, the brand will steadily march towards its inevitable demise.
Brand revitalization is more than marketing. It is about keeping every part of the business focused on continuous improvement, continuous renovation and continuous innovation.
Brands do not have to die natural deaths. They can live forever. For brands to thrive and survive, they must keep the flame alive. They need a continuous supply of creative oxygen.
Larry Light, a global brand revitalization expert, is co-author of “Six Rules for Brand Revitalization” (first and second editions), “New Brand Leadership” and “The Paradox.”
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