What’s a Brand Worth?
The biggest mistake menswear brands make is to value their own names over what they do.
In the half dozen or so years I’ve been covering the menswear business at MR, I have witnessed some baffling branding decisions from both seasoned veterans and relative newcomers.
I’ve wondered as one big company acquires a smaller one for its name and customer base, only to alienate half the customers and ditch the name to top it off.
I’ve watched in bewilderment as nostalgic executives eagerly acquire a moribund brand from their past and explain that it has relevance to the under-30 market that weren’t alive when it went out of business.
I’ve puzzled at retailers who think it’s enough to restock boring product from the same luxury merchants season after season on the assumption that the famous name alone will be enough to get men to buy.
I’ve been dumbfounded as new brands market themselves on the meager basis of their own unfamiliar names without any introduction, history or context.
I’ve been frustrated clicking on gorgeous websites devoid of any useful information about annoyingly mysterious brands…then I quickly forget everything about them, save a lingering sense of confusion and irritation.
And I’ve been disgusted as bitter partners fight over a brand barely out of its infancy as their lawyers call me to make threats about the fact that I mentioned the dispute in a news story.
What none of these guys get is that a brand is more than a name and a logo. It’s even more than a legacy. It’s what you do.
A short piece in the New Yorker this week really hammered that message home. In “Twilight of the Brands,” financial writer James Surowiecki used the example of Lululemon, the yoga brand that lost its luster after a series of blunders in manufacturing and marketing. What happened? Lululemon learned that even brands with “cult-like” followings, brands that represent movements and entire lifestyles are not bulletproof.
“It’s a truism of business-book thinking that a company’s brand is its ‘most important asset,’ more valuable than technology or patents or manufacturing prowess,” Surowiecki writes. “But brands have never been more fragile.”
Why? A super-informed, super-curious public doesn’t need brands as shorthand for quality and reliability the way we used to. “If a car was made by G.M., or a ketchup by Heinz, you assumed that it was pretty good,” Surowiecki writes. “It was hard to figure out if a new product from an unfamiliar company was reliable or not, so brand loyalty was a way of reducing risk.” The good news/bad news is that, as Surowiecki puts it, “you’re only as good as your last product.”
There’s actually lots of good news here. It means that you can invent a brand with no history and tap into the heritage brand fever that has elevated truly historical brands. You can come up with a dumb brand name that’s either bland, unpronounceable or just painfully unimaginative and still be a great success based on product and marketing. You can lose your own name in a battle with your investors and come back with what really made your name valuable (your creativity) and invest that in something new. And it means a (slightly) more level playing field for emerging brands that are willing to take more risks.
