Brand Failures_ The Truth About the 100 Biggest Branding Mistakes of All Time - Matt Haig [110]
In 1994 BMW bought the UK manufacturer, trying to transform it into a competitive carmaker for the 21st century. But BMW was mainly interested in the group’s Land Rover division of four-wheel drive vehicles.
The Rover 75 was the first new car produced after BMW had bought the troubled company so every effort was made to ensure that it was a technical and aesthetic success. At first, these efforts seemed to have paid off. Across Europe, Japan and the Middle East, the Rover 75 was heralded as an excellent car by the automotive press during the year of its launch, 1999. One magazine commended its ‘elegant retro look’, and described it as ‘classy, stylish and refined.’ In total, the car won 10 international motor industry awards. And yet, despite such weighty endorsements, people were reluctant to buy the car. In 1999, just 25,000 were sold, which was well below target figures.
The problem, it appeared, was not with the car itself, but with the brand. According to Jeremy Clarkson the Rover name has a certain stigma attached to it. ‘It’s just about the least cool badge in the business,’ he said. ‘Rover, the name, is a dog.’
Of course, this may only be a matter of opinion. The sales figures, on the other hand, are a matter of fact. ‘A look at the numbers shows that the buyers are bargain hunters who flock to the showrooms only in response to extraordinary discounts,’ reported the BBC. The sluggish sales associated with the Rover 75 were therefore symptomatic of a broader problem regarding the Rover name itself. The company had become, in the words of one journalist, ‘a living symbol of the UK motor industry’s decline’.
‘The Rover 75 was the turning point. It was supposed to be the car that set the seal on Rover’s renaissance,’ says Jay Nagley of the Spyder consultancy. ‘The Rover 75 was a good car, but the problem with Rover is the image. People in that market sector didn’t necessarily want the Rover image no matter how good a car it was attached to.’
By March 2000, BMW had had enough. With Rover piling up £2m losses a day, the firm decided to break up the company.
The Rover name lives on, albeit with the ‘land’ prefix. In March 2008 TATA, an Indian conglomerate, bought Jaguar Land Rover for $23 bn, relieving Ford of the burden.
Lessons from Rover
If the name doesn’t work, change it. Critics suggested the Rover name should be dumped and rebranded as Triumph.
Concentrate on the brand not the products. ‘The problem is the brand rather than the cars,’ said motor consultant Jay Nagley.
96 Moulinex
Going up in smoke
Moulinex, the French-based electrical household appliance manufacturer, filed for bankruptcy in September 2001. The action placed the brand in immediate jeopardy, but was seen as necessary. ‘If they want to keep going but the shareholders wouldn’t agree, they had to do this, otherwise it would have meant liquidation,’ said one analyst at a Paris-based brokerage.
As the company neared collapse, Moulinex’s 21,000 employees started to resort to unusual methods in order to keep their jobs. One microwave factory in northern France was occupied by workers and then set on fire. The following day employees returned and threatened to detonate homemade bombs to destroy what was left of the plant. According to Business Week magazine, union officials even kidnapped the government appointed mediator to try to get a better deal on lay-off packages. ‘I am somewhat detained, but it’s not a real drama,’ was the message the nabbed mediator managed to phone in to the press.
These dramatic events constituted only the final chapter in what had been a slow and steady slide for the company. Under the management of Moulinex founder, Jean Mantelet, the company failed to anticipate the economic slowdown of the early 1980s, and from 1985 onwards losses began to mount up. Another problem related