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Branding Strategy: Repairing the Shoe Shop

I took a pair of shoes in to be repaired today. Around the corner from our San Francisco office there are two shoe repair stores. One of them, Anthony’s Shoe Service, is an old-school shoe repair shop that has been in business since 1926 – a dying breed in the city. Next door to it is Mak & Co – a relative upstart with one of our favorite signs in San Francisco. “Mak & Co: Shoe Service, Keys Cut, Watch Repair, Shoe Shine, Nails, Facial, Waxing, Massage.” Basically, any service you can cram into 650 square feet.

Branding Strategy

The two stores illustrate two distinct brand challenges.

Anthony’s has a clear identity and brand focus. They offer a highly specialized service, have a loyal clientele, and will continue to repair shoes as long as their customers keep coming in. However, with a singular focus, they have limited alternatives for driving new business or growing revenue.

Mak & Co, on the other hand, is highly entrepreneurial, offering a bewildering array of services with skills that may or may not transfer from one service to the next. As they add more and more services, they face the risk of confusing the market. Mak & Co. is an identity that doesn’t say anything.

brand positioning

We recently helped a client faced with the same brand challenge as Mak & Co. Highly entrepreneurial; they had started as service company with a specific industry expertise in digital media buying. As their capabilities and client list grew, they added more and more individually branded services and proprietary technology tools that they could sell separately. Although revenues continued to grow, their growing sales and account team couldn’t clearly articulate what business they were in or how their offerings added up to a clear value proposition. By being so broad in their offering, they risked losing business to more specialized competitors.

Our recommendation was to develop a new brand positioning that serves as a broad platform, appropriate to the multiple services and technologies they provide, yet establishing ownership of a specific expertise. It also gives them a clear direction for future growth. This new positioning has invigorated the company, clarified their business direction, and reassured their investors. Now, everyone in the company can clearly articulate what the business they’re in and why they matter to their most critical audiences.

The moral of the story: A company with a clear brand positioning has a greater chance of gaining new business and retaining existing customers. Where did I go to get my shoes repaired? I went to Anthony’s.

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Brand Story Case Study: Shutterfly Success

Through an excellent brand story, Shutterfly continues to help consumers navigate their own path to personal expression, providing much more than products; they provide the promise of personal creativity, expression and shared experiences.

Since building and communicating their story through all they say and do, Shutterfly has been rewarded with double-digit growth year over year. It is a great example of how a clear, relevant story can help your brand elevate above others in the market.

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What is the Role of Research in Branding?

Managers and CEOs often want to base their brand decision on measurable market research. So, how much market research should you do?

Research can never give you all the answers, but it can be effectively used to understand how target audiences might receive a new idea, or to find a new market opportunity.

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Brand Decision Mistakes: The High Cost of Brand Reversals

Brand decision mistakes happen.

We saw it decades ago with New Coke. More recently with the Gap.  And most recently, Netflix reversed a highly unpopular brand decision after realizing their once successful branding strategies had been tone-deaf to the customers who had made their brand a success.

Brand Decision

How much do these reversals cost companies? The protests and general ridicule that erupted upon Netflix’s announcement that they were separating their DVD and streaming services were immediately everywhere. The new name for the DVD service, Qwikster, took the brunt of the punishment, however this was backed by a strong sense of customer betrayal. Customer defections, according to yesterday’s earning report, surpassed 800,000, due largely to unpopular price increases, but accelerated by this announcement.

The source of these feelings and actions came down to two justifiable points:  1) Netflix seemed to be putting its business priorities ahead of the needs of its customers, and  2) Netflix was trying to get out of the DVD rental business as fast as it could.  Reid Hastings’ letter to customers said as much when he proclaimed:

“We realized that streaming and DVD by mail are really becoming two different businesses, with very different cost structures, that need to be marketed differently, and we need to let each grow and operate independently.”

This is what we would call “sacrificial lamb” branding.  By splitting the DVD business off, giving it a lowbrow name, and offering customers less for their money than they had received before, Netflix was signaling how little it now cares for the business. Having a different website with a different name would, hopefully, allow Netflix to disavow DVD rentals without tarnishing their own name.

Putting the business before the brand obviously did not work for Netflix, and it remains to be seen whether their brand reversal can repair the customer damage. What is clear, is instead of looking at pigeonholed brands like Borders and AOL when making their future plans, Netflix should have considered those brands that have successfully led customers along major brand transitions, notably Amazon and Apple.

Under astute leadership and keen customer insight, both Apple and Amazon have seamlessly transitioned multiple times from physical product to digital services, taking excited and faithful customers along for the ride each time.  Successful branding strategies like Apple redefined music, media and telecommunications with each advancing initiative, announcing each revolution in a trademark keynote address. Amazon has redefined how it sells books, music, media, and everything else under the sun without major brand reversals.  In the end, it is these brands, with the loyalty that they engender that will probably unseat Netflix.

The lesson learned here is, successful branding strategies never put the business before the brand. Customer engagement, understanding and loyalty to your business should be considered alongside decisions to cut costs, or streamline or evolve businesses. Not making these considerations can result in embarrassing and costly brand reversals.

Marshall Strategy

Do you want to tap into successful branding strategies and corporate identity efforts? Marshall Strategy has a proven track record of making a difference for our clients. Contact us today to find out what Marshall Strategy can do for you. Find out what we’re doing in the social world by “Liking” us on Facebook, following us on Twitter and subscribing to our YouTube channel. Also, find us on LinkedIn and follow our blog for more useful industry information.

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