The Brand Man Speaks

Starbucks testing new retail concept without Starbucks' brand name

The recession has impacted many industries and businesses that might historically not have been hurt by a weakened economy. Starbucks which re-defined an entire industry around coffee has seen sales and profits plummet unexpectedly over the past two years along with much stiffer competition from fast food brands like McDonald's and Dunkin' Donuts.

In addition, Starbucks has made many strategic missteps even before the recession in an effort to expand their business beyond coffee and the local gathering spot strategy. Music, movies, casual dining food are among the various "products" the brand has tried to add to its offerings....with mixed results. Most importantly, some of these elements worked to undermine the core brand strategy adding more problems beyond the recession's impact.

Now comes word that Starbucks is exploring new retail ideas but without the Starbucks name attached. Some industry experts think this is a mistake and another strategic blunder. I do not agree.

I have recommended to clients many times over the years the idea of establishing a new sub-brand to introduce ideas and concepts that might undermine the core brand and give an entity the opportunity to reach different/new audiences. The new Starbucks concept is called 15th Avenue Coffee and Tea and will serve food and wine and beer beyond the coffee offerings. 15th Avenue will not have any Starbucks IDs on-site and will appear to be a completely independent concept giving even the most ardent anti-Starbucks consumer an opportunity to experience this brand's new ideas.

Starbucks can use its existing marketing muscle and savvy to successfully launch the new brand quickly if the idea is well received. The initial store is in the home market of Seattle replacing an existing Starbucks location. The company says additional locations will be in new real estate and not re-furbished existing Starbucks.

Success will depend on the actual concept itself, its appeal to consumers and uniqueness as well as how well the concept is executed in its test form.

I look forward to seeing this concept first hand soon.

Watching out for you everyday.

Eli

Sears Tower to be called Willis Tower; will brand change undermine iconic skyscraper?

When Chicago became home to the tallest building in the world (now eclipsed by buildings in Asia) it was an important milestone for the windy city giving it great cache and bragging rights over New York. Retail giant Sears was the building's primary tenant and since the 70s when the huge building was opened it instantly became a notable US landmark: The Sears Tower.

Now the building's owners are changing its name to Willis Tower to reflect its new largest tenant, Willis Insurance out of London. And a great debate has ensued.

Ballparks, stadiums and notable buildings make a bundle when they sell rights to name their structures to high paying sponsors or building tenants. Names change often in this world as one company's fortunes decline another takes up the helm with new naming rights and signage.

In the case of the Sears Tower, the brand ID for this impressive structure that just opened an observation deck of glass hanging off the top of the building, is key to its stature. It has been called the Sears Tower since day one and changing it now seems a bad move. The Sears Tower is more than a sponsorship or important tenant name (Sears has NOT been a tenant for over a decade or more). It is a name tied to the building itself; its Brand ID. Sears is still based in the Chicago area and although not the major retailer of the past, it still is a important retail player US wide and closely tied to its Chicago area roots.

Additionally, the name Willis just seems flat doesn't roll off the tongue and somehow in my mind will diminish the iconic nature of the "Sears" Tower.

I have read the name change is a done deal but does that mean it is a good idea when it comes to tourists and Chicago's brand? It will take a long time for people to "forget" the Sears Tower brand and ask to be taken to the Willis Tower. Further, naming the building after an obscure English insurance company no one in the US knows about or cares about also seems foolhardy and anti-American, no?

Fans of the Sears Tower are taking their case to the world via Facebook and other social media to try to generate enough negative support for the new name to try to force the building's owners to not change the name. They also are seeking landmark status for the building and its name (although the building is not old enough for such a status as those things go), hoping a government decree will make it impossible for Sears to be replaced with Willis.

Some have said changing the name of the Sears Tower would be like changing the name of the Empire State Building or Eiffel Tower...it just wouldn't be done no matter how much money was put up for the rights. What do you think?

Watching out for you everyday.

Eli

Tide testing Tide basic; less expensive version of original brand to offset sales loss

P & G, the most well known consumer products company and one of the world's largest, producer of brands like Tide and Crest is facing a major challenge. After strategically going up-market during robust times with many of their brands, the prolonged weakened economy is hurting the bottom line big time.

Tide, a premium priced laundry detergent, has seen some of the biggest declines in sales in anyone's memory. So much so the brand is testing a lower priced Tide called Tide Basic in powder form. The idea? To keep the franchise's market-share and loyal consumers as best as possible without losing too many to other price oriented brands.

The problem? The Tide brand was built on the premise it was a superior performing product, one that was used by grandmothers and passed down to mothers and their daughters. It has had strong emotional loyalty unlike any other laundry detergent brand. However, in this new economy consumer buying behavior is changing dramatically in ways most consumer product companies are not accustomed to. Price is the factor even for affluent consumers and product performance and efficacy seem to be less important. The paradigm shift has not been completed making it even harder to gage what steps are best to keep consumers loyal and which to avoid that might cause damage that cannot be undone when the economy improves. Thus, we are in uncharted territory.

With Tide Basic P & G definitely runs the risk of losing its loyalists who have bought the liquid original brand for years. The lower priced brand that has reduced some of the benefits of the original can both undermine the original more so than has already occurred and, more importantly, question the entire brand premise. If you can buy a cheaper version and it is almost as good why then ever buy the original?

When price becomes the brand purchase driver and all other brand elements are not sustained or emphasized the brand becomes a commodity brand and its competition becomes broader and more dangerous.

Let's see how the test does in various cities and we shall revisit this discussion in a number of months. It may prove to be a noteworthy case-study of how to successfully or not successfully handle the new consuming world we have entered.

Watching out for you everyday.

Eli

Michael Jackson: a small personal memory

As the world prepares to mourn and celebrate the death of musical talent extraordinaire, Michael Jackson, millions of people have started to share how he impacted their lives and the lives of a generation. Me included. Not since Elvis does the world have an entertainment legacy brand that will be much greater after death than during life...as long as it is managed well, (let's hope, since so many people have had their hands in his life I imagine more will want a piece of him in death).

I grew up with the gloved-one's music finding it irresistible and mesmerizing...finding it impossible not to learn nearly all the words while marveling at his dance skills...(which I sadly tried to but unsuccessfully mimic). I along with millions got to know Michael from a far until I had a short very personal experience a few years back.

Before Lionel Richie became a client, I had the opportunity to meet him for the first time with some friends over brunch at the celeb packed restaurant The Ivy. Lionel arrived very late to our small gathering on the cell phone intently listening to "someone" at great length. Even after Lionel sat down with us...some 15 minutes later...we still hadn't been formally introduced because he was still on the phone.

Noticing our growing discomfort with what appeared to be the "rudeness" of staying on the phone as food arrived, Lionel put the phone on mute and handled it towards me...but saying first..."it's Michael he wants my advice and I have to listen". Michael? I inquired. Michael Jackson he responded. And with that Lionel handed me the phone for a very brief time. I listened as the King of Pop sadly and soulfully expressed his love for people and how he was misunderstood. This was the time of his first court case for child molestation and those close to Michael like Lionel were making themselves available to be there for him in his time of need....as many wouldn't listen to him as the world began to shift their opinion of the K.O.P. from honor and worship to disdain and disgust.

Lionel, who had co-written and produced "We are the World" the hugely successful charity song with Michael,  was very worried about him self-destructing at that time, understandably. There were so many people in his life trying to tell him what to do, we all talked about how difficult it might be for him to get out of this situation unscathed. He settled out of court with his accuser but public opinion was not favorable.

After that time Michael seemed to become a Howard Hughes type and the world became further confused by his behaviors and his popularity waned. Additional litigation and money woes didn't help his image either.

But alas on the eve of his highly touted come-back tour he leaves us for good. Now, despite his many behavioral and money issues, which will never go completely away, the world has shifted its opinion and now is taking the time to celebrate the genius that he was and the impact his work has had on the world for the past 50 years.

Thank you to Lionel Richie for giving me a memory like no other.

Watching out for you everyday.

Eli