Tuesday, February 6, 2007
Thot bubbled #27
Why do companies that spend a ton of money buying other companies with established brands kill the brands owned by the companies they have just bought? Is it all about the basic human tendency to break things because they're easy to break without realising how much time, money and grey matter has been invested into the building of these very same things. Building equity for a brand is one of the hardest things in the marketing world. Companies should think less about killing and more about segmentation.
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6 comments:
Interesting question. My company through this process recently when we got acquired by a bigger company. The challenge is to somehow leverage all the existing brand value of the company you buy to increase the brand value of the new integrated company. So you can't just leave out your name right?
Say the buyer is called Secure Widgets and the company being bought is StrongCo which makes a products called Strongco SuperDooble and Strongco SuperDweeble. What do you name the products after the buyout?
Secure Widgets Strongco SuperDooble? That's too long. So what part do you leave out?
We left out the StrongCo part because our product branding was as strong as our company branding (or so they said). What are your thoughts?
Why would you want to rename the existing brands? Renaming is re-inventing which is one step up from destroying. I'd buy out a brand and continue to milk it if it's making oney. I'd nurture multiple brands. I would certainly not combine brand names. There's place for Thums Up and Coca-cola.
Btw, if I may ask, where is your blog, Ajju?
My blog is http://ajju.us/blog
Re why would you want to rename existing brands..to have them identifiable and short. For eg thumbs up is cool but is Coca Cola Thumbs Up any good?
So we maintained the product brandname (SuperDooble, SuperDweeble). The company brandname change was inevitable I guess, our company got acquired and would cease to be an entity in a few months.
Consider this similar to say if Thumbs Up was originally called Parle Thumbs UP. Wouldn't changing that to Coca Cola Thumbs Up be better?
Of course it makes less sense in this case since Coca Cola is also the name of a product, not just a company name.
I agree with you uber.. if the brand's got great equity, why would you damage it by changing the name or axing it altogether? unless ofc adding another increases it which would be a good rationale.
wud u buy a tag if it was called swatch? maybe a guess if it was by cartier? I think it depends on the equation and strengths..
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