Wednesday, 9 September 2009

Al Ries on AdAge Thinks Line Extensions Kill Brands -- I Beg to Differ!

Comment to Al Ries's latest column in AdAge, link: Slowly But Surely, Line Extensions Will Take Your Brand Off Course

Hm. Al, I usually agree with you wholeheartedly as you look for underlying strategic issues that have an enormous impact upon the short-term and shallow POV most people focus upon, and your focus here is consistent -- long-term and strategic -- but I'm not sure you can use the beer biz (one of my areas of focus back in the late '80's) as confidently as you have here. Which does not negate your point, but it does call into question all the myriad of other factors that influenced this category and most others.

I tend to agree that never-ending line extensions (Miller's an ideal example) and co-branding (Febreeze/Tide/Downy) are likely to water-down a brand's image and SOM in a hockey-stick-like manner, but when you factor in the impact of a shift toward lower alcohol products for societal reasons related to drunk-driving and obesity, plus the steady growth in popularity of wine AND the surge in micro-brewery products and flavored beers due, in part, to increasingly sophisticated, worldly palates, your examples start to fall apart.

What you have not pointed to, most glaringly, was not different flavors for any of the big beer brands, but divergent brand characters. I suspect this was the single, most suicidal factor in each brands' weakening market position. How is it possible to have a 'cowboy' brand (like Coors) alongside a feminine light product (like Coors Light)? Or a down-to-earth, solid brand like Bud/Miller next to a funny, irreverent brand like Bud/Miller Lite? These were the first HUGE examples of demographic (beer's all consumed by males and the majority of men appreciated both manliness AND humor) versus psychographic errors in positioning that any major marketer made (new Coke being another painfully apparent example of the era).

What the beer giants learned was that light products welcomed females into the beer drinking world, and that the hard-core macho male beer drinker was never going to be able to reconcile the notion that "HIS" brand had a 'lighter' sister -- trying to 'marry' those two divergent natures under one brand umbrella proved to be long-term suicide, as any marketing professor, asked for an opinion up-front, would tell you.

I'd agree with Jeff that if a line extension stays within the brand's character (and targets the exact same core psychographic profile) and product segment, it can help to build share, not erode it. The factor no one is examining today, because we are still trapped in the glorious 'global brand' days of long ago, is the fact that now brands might have become transitory at worst, or niche at best. What I mean is that with the fragmentation and 'customization' we're seeing globally due to internet-based communication, many, many branded products (at least new ones) might have limited lifespans, or their manufacturers may have to accept that they are never going to become global, generic household names like Kleenex, let alone ever get into having 28 flavors.

Now THAT would be a big change!

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