By TON Admin
Rebranding is the creation of a new look and feel for an established product in order to differentiate the product from its competitors and make it more appealing to the consumers.
Rebranding may include a name change, new logo or packaging, product tagline, company colors or company’s corporate website. While more than 50% of businesses that rebranded in the last two decades have recorded significant progress in their first year after rebranding, a number of them have been considered rebranding flops in the US for instance.
When Coca-Cola changed the formula for its famous Coke brand in 1985, the public reacted as if the company had ruined a symbol of America. It took less than three months for Coca-Cola to pull the new formula from shelves and return to the original formula which they rebranded as “Coke Classic.” What happened? Some marketing experts believe that Coca-Cola failed to ask the simplest and most important question: “Do we need to re-engineer our formula?”
Below are some of the things to consider when bringing change to bring new life to your business.
Evolution is inevitable. Change is very important. Whether it is a complete overhaul or a few adjustments, every company can stand a bit of improvement, says Michael Silverstein, a consumer and retail expert with The Boston Consulting Group (BCG), a global management consulting firm. “Even awkward first steps toward improvement are highly regarded by consumers.”
Seattle’s Best Coffee, part of the Starbucks family in the US, revitalized its business and its 40-year-old brand in 2010 as part of its new strategic direction. The company expanded its diverse distribution with a goal of establishing 100,000 places—from Burger King to Alaska Airlines (US)—where people could enjoy a freshly-brewed cup of its premium coffee. Within six months, the company increased from 3,000 to 30,000 distribution points that included company operated stores, franchised businesses, retailers, grocers, restaurant chains, and food service locations, such as college campuses.
Back to East Africa, when Uchumi was put under receivership in 2007, only rebranding and changing the way things were done could save the company from liquidation. The Uchumi supermarket chain closed down after finally admitting it was insolvent – with debts of hundreds of millions of shillings.
The board concluded it unethical to continue trading at the Nairobi Stocks Exchange when they could not pay their debts.
Six years later, the company was back at Nairobi Securities Exchange. Led by Mr. Jonathan Ciano, Uchumi won many accolades for successfully rebranding and restoring confidence among investors and consumers.
Noticeably, Uchumi never changed its name, it’s colors or tagline. The management outlined the major reasons for their downfall and how best to counter them. These included Competition.
Research on your competition and seek allies and partners to drive your business further. Convince investors to buy your agenda to enable you grow significantly. Uchumi had lost its market share to new players such as Naivas all fighting for the same cake. The expansion of Nakumatt and Tusky’s brought shopping closer to home. Secondly, Inflation reached a record high of 12% in April 2010 due to high oil prices. This eroded individuals’ disposable income which led to low sales for the supermarket chain. Thirdly, drought led to supply disruptions hence affecting sales.
The company narrowed down to regional expansion to hunt for new customers and reclaiming brand loyalty as the key steps to rebranding.
Other companies that successfully rebranded include MacDonald’s Restaurant in the US that nearly collapsed after its competitors mocked the food chain as the cause for obesity in the US. The food chain rebranded itself as more health conscious with a greater variety of salads and other healthy meal options, in addition to offering lower-priced menu items. The company also went after the coffee crowd with its fancier and more expensive premium coffee.
Despite the derision of critics, McDonald’s makeover worked. McDonald’s reported a 5.3 percent rise in January 2011 sales at locations open for more than a year, and topped the average forecast from analysts of 4 percent, according to FactSet Research.
Lesson: Pay attention to what the public says about you and respond with products and services that counteract those accusations.
Rethink Your Customer Base. Part of revamping your business may involve targeting your product or brand to appeal to customers outside your niche demographic, versus introducing new products or lines to boost business. Appealing to a wider customer base can make up for less business by existing customers.
Finally, set yourself apart from competitors with high-quality merchandise at lower prices. This way, consumers will be flocking to your shop with orders that guarantee satisfaction. Package your products in affordable packs and that are flexible according to a customer’s economic ability. For example, many soap companies in East Africa have been manufacturing varying sizes of powdered soap packed in small sachets with a low price of 5 shillings as is the case in Kenya.
Finally, the most important thing to have in mind before rebranding is that it should mostly be informed by changing trends in business returns and the need to be on top of your game.