Brand Failures_ The Truth About the 100 Biggest Branding Mistakes of All Time - Matt Haig [67]
When Quaker sold Snapple to Michael Weinstein and his colleagues, the brand was in trouble:
We inherited a brand in a deep sales slide, losing 20 percent annually, and a demoralized organization. At the time Snapple was six times the size of our company, but only two Snapple headquarters personnel from Chicago chose to join the new team in New York. Few outside observers believed a small beverage company competing with Coke and Pepsi and with a new team could turn Snapple around, but we outlined a strategy and vision of success that the entire organization could rally around.
In an interview with Fast Company in 2001, Michael explained how his company, called Triarc, managed to undo the marketing and advertising failures which occurred under Quaker’s ownership of the brand. ‘We tried to create an atmosphere that was fun and timely,’ he said. ‘We introduced our first new product two weeks after we bought the company. That’s fast.’ Another part of the strategy was to bring back the adverts featuring Wendy the receptionist.
Gradually, Snapple’s original customer returned and the brand again increased in value. In 2000, Cadbury Schweppes bought Snapple for US $1 billion and in 2008 the brand became part of the portfolio spun out of Cadbury’s and established as the Dr Pepper Snapple Group. Snapple brands include 7Up, Canada Dry and Schweppes.
Lessons from Snapple
Accept that different brands need different distribution. Quaker believed that Snapple could be pushed through Gatorade’s distribution system. ‘It turned out that Quaker’s distribution competences could not be leveraged to push Snapple because the image of the two brands is very distinct,’ says Sanjay Goel, an assistant professor at the Department of Management Studies at the University of Minnesota. Snapple’s New Agey image had been supported by the fact it had been sold through thousands of small-sized and independent distributors, Quaker decided it was best to use supermarkets and other larger outlets.
Understand the brand. Ultimately, Quaker failed to hold onto Snapple’s brand value because it did not understand the essence of the brand identity.
Chapter Seven
People failures
The people behind a brand are its main ambassadors. If those people fall out with each other, act illegally or make negative statements about their products, then a crisis may quickly develop. This is especially true in those cases where the people are the brand, as in the case of a pop group or a TV personality such as Martha Stewart or Rosie O’Donnell (both of whom have done much to diminish the value of their branded personalities in the United States). It is also true when people at the highest level of the company are caught acting irresponsibly.
The most obvious case of ‘people failure’ in recent times is that of the Enron scandal, where fraudulent activities were associated with individuals at the very top of the company. However, corruption is only an extreme and rather dramatic aspect of people failure.
Sometimes brands can die as a result of the words that come out of the senior executive’s mouth. For instance, the Ratner’s brand of jewellery lost its market value overnight when Gerald Ratner declared his products were ‘crap’. Whether or not this was a fair assessment was beside the point, the very fact that he said it was enough to destroy the brand.
As he left the White House in June 2010, BP’s chairman Carl-Henric Svanberg said, in explanation of his company’s appreciation of the problems caused by its Gulf of Mexico oil disaster: ‘We care about the small people. I hear comments sometimes that large oil companies are greedy companies or don’t care but that’s not the case with BP. We care about the small people.’ This kind of patronizing comment went down badly in the Gulf, but was caused