Are your brands living in the past?

By evoke
December 13, 2010

A recent article lamented the precipitous drop of two iconic brands from their long-standing reign at the top of the beer market share rung. Alan Middleton, a marketing professor at Schulich, observed that the strategy for Labatt Blue and Molson Canadian seems to be to let these brands starve to death.

Having slipped to third and fourth place, some of the other experts who were interviewed for the article suggested it was incompetence that had led to the downfall of these brands and that emergency surgery was required to resurrect them to their rightful positions. Is that the right approach? How do you decide whether to let the brands live or die?

The answer to that question depends very much on how you define yourself as a beer company. If you define yourself within the rigid confines of “we own a set stable of brands and we have to maximize their performance”, your perspective will be that Blue and Canadian had great equity in the past and you just have to find a way to recapture that equity in order to manage their rescue.

We call this a “living in the past” approach. It assumes that what worked in the past will work in the future. It ignores the fact that the consumer is constantly evolving and what used to attract them is often no longer relevant or resonant. Trying to save these brands will mean much time, energy and money will be spent in a fruitless effort.

In contrast, if you define yourself as the manager of a portfolio of constantly evolving beer brands, you land on an entirely different strategy. You will manage the beer brands you have now, and the beer brands you will have in the future, as transitory players that will come and go depending on the vagaries of the market place and the consumer. Just like conductors are constantly changing emphasis of instruments in a symphony orchestra based on the needs of the music, a beer company will “play” its brands to suit the current needs of the customer.

It may mean that beer brands have a four or five year lifespan followed by a slow but profitable death (sales revenue without marketing expense). It recognizes that the divestiture of support, as Labatt and Molson seem to be doing with Blue and Canadian, is a sign of strength. The future – and your marketing support – is reserved for newer, more relevant brands that are introduced to take their place.

Are you hanging onto products or services that are living in the past when you should be doing “constructive culling” to be prepared for the future? The answer is apparent when you know who you are.

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