Businesses' blunders make a mess of their brands

Larry Light

Special to the Village News

On a day in November 2008, three automotive-industry CEOs flew from Detroit to Washington, D.C. on a mission they insisted was crucial to their companies’ survival.

They sought a federal bailout to help prop up their struggling businesses. But to the American public and some members of Congress, the CEOs’ lament that they were hard up for cash rang hollow because of their chosen mode of travel in luxurious private jets.

Their arrogant attitude left people with bad perceptions of the individual car brands, the overall Detroit brand and even the larger brand of cars made in America.

Such stumbles aren’t that unusual, and brands on occasion commit major missteps that risk putting them out of business. In fact, some people even claim brands go through a natural life cycle from birth to death, so the eventual demise of any given brand is inevitable. But that’s not necessarily so.

Brands can live forever. The problem is that brands too often get into trouble due to self-inflicted actions of their owners.

There are probably a dozen identifiable ways businesses can make a mess of their brands, but I will focus on four.

The arrogance of great success leads to ruin. Arrogance is bad for business and bad for brands. Avoiding arrogance takes character and effort on the part of leaders. The leader who creates a culture of arrogance by letting success go to the head and ego is a leader who is more committed to self than to brand.

Also, brands die because of the comfort of complacency. For brands and organizations, complacency lulls people into laziness and inaction and crushes curiosity and creativity. Eventually, it leads to market-share loss. The danger is that you stop looking at the changes in the world around you and in your specific market segment. Complacency creates inaction and eventually irrelevancy.

Bureaucracy and “silos,” where departments don’t share information with each other, can damage the brand’s health and the organization’s health. Silos, for example, create all sorts of bad behaviors, such as hoarding, stopping the spread of ideas and reinforcement of the status quo. When silos are combined with mind-numbing bureaucracy, a brand can stagnate.

Lastly, focusing on analyst satisfaction instead of customer satisfaction kills brands. Too many companies focus on short-term gains and the stock value this quarter. They lose sight of long-term strategies and keeping customers happy over time. A brand needs to satisfy stock analysts and investors four times a year, but they need to satisfy customers every day. Yes, corporate boards have a duty to shareholders, but those boards need to recognize that there is no shareholder value unless there is customer-driven brand value.

Even the biggest brands can fall into trouble, as we see all the time in the news. Sometimes it’s a fast free fall, and sometimes it takes decades. But it doesn’t have to be fatal. It’s possible to change the trajectory from waning to winning.

Larry Light, a global brand revitalization expert, is co-author with Joan Kiddon of “Six Rules for Brand Revitalization.”