What’s Needed: A Refresh or a Total Rebrand?
When sales hit a standstill, retail brands need to assess their options.
So many retailers are at a standstill. They often blame it on a sluggish economy. However, is that really the problem? Consumers are spending: Maybe they’re more judicious about it, but they are buying. If they are buying less than they used to in some retail stores because of choice, not finances, that’s a problem. It usually boils down to a number of maladies: a brand set adrift, a loss of relevance, less-than-delightful customer encounters, experiences that don’t match up to the hype created by marketing campaigns — or a little to a lot of each.
When this happens, retailers sometimes opt to do nothing, thinking they can ride out the situation; others decide to rebrand. Both of these choices are at opposite ends of the spectrum. Doing nothing is never a good idea. Any retail brand that is in a holding pattern or losing ground needs help; problems don’t go away by themselves, and remedial action is necessary. However, doing a total rebrand may be unnecessary and might do more harm than good. Revitalization just might be the answer.
There are assets associated with retail brands, especially those with heritage, that have value and shouldn’t be discarded. By doing consumer research to assess equitable assets, retailers that have gone adrift can be returned to reinforced core brand values and be made more responsive to customers’ needs and current trends. Discarding assets that customers value is a terrible idea. Rather, it’s important to leverage them as the starting point to rebuild. This is what a brand refresh or revitalization is all about.
It’s never wise to throw the baby out with the bath water, but sometimes the retail brand has so little value left that it has to undergo a total rebrand, or it will go out of business. We all know of retailers that have lost focus of their brands along with any relevance. Some have tried to revitalize or rebrand with excellent results, while others have had dismal to catastrophic results. Ann Taylor succeeded, but Sears has not.
>RETAIL REFRESHES AND REBRANDS
First, let’s acknowledge that some retailers remain rooted and true to their brands. They’re in tune with their customers, delivering strong brand experiences, anticipating customer trends and staying ahead of the competition so they remain viable. They are constantly tweaking their brands in a smooth and consistent manner so that major overhauls are unnecessary. These retailers constantly think about helping consumers live their lives better. Their values speak to their customers’ values. New product offerings and services keep pace with the customer; they’re relevant. More than anything, they consistently deliver on their brand promises. As a result, their customers are more than loyal: They’re brand zealots. They can’t imagine a world without their favorite retailer. Think of Nordstrom, IKEA, Whole Foods and H&M. Their successes speak for themselves.
>A REFRESH AND A WRECK
Other retailers, once dominant among their constituents, have lost their way. The Mass.-based retailer Talbots has made its share of mistakes in recent years in its attempts to revitalize its brand. Firmly branded for decades as a retailer for women over the age of 35, Talbots decided to expand its retail footprint to include apparel stores for men and children, as well as apparel for these demographics in its catalogs. After trying to make it happen for a few years, the retailer closed these divisions out.
“When brands hit a standstill with consumers, it usually boils down to a number of maladies: a brand set adrift, a loss of relevance, less-than-delightful customer encounters, experiences that don’t match up to the hype created by marketing campaigns — or a little to a lot of each.”
Talbots had always been perceived as a retailer providing updated classic apparel to mature women. The retailer’s decision to revitalize the brand by trying to cater to a younger clientele made no sense. Younger women, who have plenty of age-appropriate options, couldn’t envision shopping at Talbots. Yet, younger clothing styles appeared, mixed in with apparel for its mainstay customer, alienating the mature women who had always turned to Talbots. To make matters worse, cheaply made, ill-fitting apparel replaced high-quality, timeless clothing styles that correctly fit. Instead of making itself relevant to the next generation of women 35 and over, the retailer went after an audience it couldn’t hope to win. Bloggers have discussed uneven customer experiences within Talbots’ retail stores; some have been strong, and others quite disappointing. Adding to that, the retailer’s website continues to present problems with frequency when customers try to make online purchases. With major disconnects and issues at every customer touch point, Talbots may not be around much longer.
On the other hand, when Seattle-based co-op REI needed help, it was understood that the retailer had extremely loyal members, and the brand had equitable assets. At 70-plus years old, REI was failing to attract younger customers, which an outdoor retailer must of course do. REI called on retail brand design experts to research its problems and address them in a comprehensive, 360-degree manner. REI’s brand was revitalized with a new brand identity and positioning, visual branding system and customer acquisition strategy. The logo was updated along with store planning, exterior trade dress, packaging, apparel- and gear-marking systems, and the brand standards manual. Nothing was left untouched. Most importantly, with top-level executive cooperation, internal branding initiatives including employee training and an employee rewards program were instituted. Customer-facing initiatives included a new member loyalty program, improved catalog program, REI gift card program and bank card marketing strategy. Nothing was skin-deep about this brand revitalization. The result was a marked growth in new customers and sales and a 200-percent profit increase without alienating its established customer base.
>REBRANDING HIT AND MISS
Radio Shack is a perfect example of a retailer that clearly misdiagnosed its problems and responded to them with the wrong solution. The brand had not kept pace with the customer. Losing business to competitors that offered trendy tech products and a better experience made the brand look old and tired. In 2009, the retailer decided to rebrand. Unfortunately, it wasn’t well thought out or executed, and it didn’t seem to be well researched. The retailer changed its branding from “Radio Shack” to simply “The Shack” (which sounds like a teen hangout for rave parties). As bad as that was, the name change was clearly a marketing gimmick, because the brand identity and store names remained the same. Merchandise assortments remained largely the same, except for an expanded supply of cell phones that consumers could just as well purchase at Walmart. That didn’t do anything to change the retailer’s image into the hip and cool identity “The Shack” was meant to convey. The core in-store shopping experience didn’t change for the customer; it didn’t match the hype.
This whole exercise was superficial, doing nothing to revamp Radio Shack to entice new customers, though it did alienate existing ones. Simply put, there was nothing authentic or believable about this rebranding effort, so it failed abysmally. The whole thing was a farce, and consumers knew it. They also knew that if they wanted innovative tech products, a memorable experience and an aligned brand, the Apple store was the place to go.
Instead of promising a total rebrand, which it did not execute, Radio Shack would have been wise to bring in experts to assess whether a refresh or a rebrand was in order and then make certain every aspect of the brand was brought into alignment. By updating its core offerings with some exciting proprietary choices to reflect its customers’ current needs and delivering on its brand promise with great customer experiences, Radio Shack might have started to turn things around.
Target undertook a total rebranding effort in the late 1990s with very different results. The retailer had been branded as a discounter, competing directly with Walmart and Kmart on price. The Target executives recognized they couldn’t beat Walmart at that game; it was time to reposition, rebrand and own unique positioning. The turnaround was dramatic. “Cheap chic” resonated with fashion-conscious consumers. “Tar-zhay” became a haunt for middle-class and affluent consumers who touted the fact they could purchase Michael Graves-designed teakettles and Isaac Mizrahi fashions at bargain pricing.
Stores’ environments became reflective of the new Target attitude. Advertising employed Andy Warhol-like pop culture photography and splashes of color, and yes, the Campbell soup can was celebrated in ads. “Only available at Target” apparel from noted fashion designers supports the retail image. Unique licensing deals and limited-time offerings are relevant to trends and impress on consumers that Target is far from staid; this is a retailer that’s on the move with plenty of newsworthy, changing merchandise.
Successful retailers have made the consumer the core of their strategies. They’ve gone after ownable positioning and remained true to their core brands. They’ve worked to deliver on brand promises every day. Many of them have done it with help. A refresh or rebranding is a major undertaking, and no aspect of the brand can be left untouched. By working collaboratively with the brand executives, experts that objectively conduct brand and consumer research without bias and present sound, comprehensive strategies can make a big difference in the outcome.
Without a 360-degree redesign, a refresh or rebrand is doomed to failure. It will not only fail to be effective, but also it will expedite the demise of the retail brand since consumers will be presented with a marketing proposition that isn’t authentic, makes no sense and does more harm than good. Executed poorly, a refresh or rebranding causes confusion among existing customers and fails to woo new ones. Marketing gimmicks are superficial, and retailers who think they can turn things around in this manner are simply deluding themselves. Just remember: Anything worth doing is worth doing well.