When it’s time to retire a brand

With news of Holden's brand demise, CMO asked the big brand question: Just how do you know when it’s time to retire a brand?


Staging a comeback  

There’s also the question of whether it’s right to kill off a brand at all. If the underlying economics of the business are still strong, it may just be to time to stage a comeback, TRP Agency strategist, Kyle Ross, said. There’s three ways the agency looks to make this decision.

The first is whether it’s a product problem, and if products being offered are working for people in terms of performance, pricing, distribution or accessibility.

“For example, SUVs make up for around 45 per cent of all new car sales in Australia, but Holden’s SUV sales sadly couldn’t make up for big drops in sales of passenger car,” Ross said, bringing the criteria back to General Motors. 

The second question is whether it’s a brand problem. For instance, are there unhelpful brand associations that limit popularity with predictable effects on sales, Ross asked.

Is there something about the brand or people’s beliefs about that brand holding sales back?” he asked. “One of Holden’s best assets was its Australian identity. But that arguably ended in 2017 when the last car rolled off the factory floor, with Net Trust Scores declining steadily thereafter.”

The third question is if it’s a communication problem. “Are we telling the right story, working in the right way or targeting the right people?” Ross posited.

“While Holden struggled to gain traction advertising a new line-up of SUVs and 4x4s, Ford found success by positioning the Ranger as the smarter truck for the contemporary pick-up truck driver. In doing so, Ford succeeded in ‘depositioning’ the market leader, Toyota HiLux, as outdated, ordinary and a somewhat unimaginative choice. Consequently, the Ford Ranger tripled its baseline sales growth, and became Australia’s largest selling 4x4 pick-up truck growing market share from 12 per cent in 2013 to 22 per cent in 2017.”

Holden’s demise

And what of other views on the loss of the Holden brand? Rogers described the core brand issues for Holden as twofold. The first was brand salience, which has been falling for years while awareness remained high.

“The other shift is in brand image versus our image of ourselves as Australians,” he said. “The basis of the Holden brand image is in a version of Australia that no longer leads our cultural narrative. In a world where what leads in culture is safety, blurring gender norms, increased urbanisation and diversity and environmental responsibility, Holden failed to reinterpret its foundation myth [freedom] through the trends of the day. In the end, Holden has made the classic mistake of confusing brand awareness with relevance.” 

Zeederberg assigned the demise of Holden locally to the lack of value, and said brands are often traded when this happens, especially in the FMCG world.

Just look at Violet Crumble, the iconic South Australian chocolate invented in 1913, which was bought by Rowntree and eventually Nestle and ‘retired’ in 2010.

“In 2018, Robern Menz bought the brand, and it started shipping again last year. So retired brands, like aging rock stars or worn out sports people, are prone to ‘comeback tours’, assuming there's still an audience and a revenue opportunity,” Zeederberg said.

And with the Holden brand retaining significant value, Zeederberg expected to see it sold off and resurrected locally in some way.

“After all, a brand that elicits enough passion to start street brawls amongst hoons and to get people to set portable toilets on fire at Bathurst definitely has value to someone,” he added.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia.   

 

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