Rebranding – When and why?
Where are the companies today that refused to adopt new technology? A well-known example from marketing studies is Kodak, market leader in the manufacture of cameras for decades. Kodak management decided to stay the same and not participate in digital camera development because they did not believe that digital cameras would become more popular than film; the company faded from the scene as a result.
Brands are subject to the same rules, and it is not beneficial for companies to let sentimentality and retrospect guide their brand strategy. At the same time, they must take care that they do not underestimate the emotional connection customers have with the brand, because that is where a large part of their value lies. There must be a good and valid reason behind any decision to overhaul a brand. Such reasons can be, for example, that sales have stagnated, competitors are steadily cutting into the market share, or the customer base is ageing and not being renewed.
What is rebranding?
As the word suggests, rebranding means that a company is setting its brand on a new course. This is about more than logos, fonts, colours and how advertisements look; it’s also about the company’s marketing strategy.
Marketing strategy is a broad term that encompasses the company’s entire offering to customers. It is about product offerings, pricing, positioning and marketing communication. The basic requirement for a strong brand is that the operational strategy and marketing communication are harmonious and coordinated. In its simplest form, this means that companies must be true to themselves and should not, for example, advertise themselves as a cheap alternative if their products or services are expensive, or brag about quality services that they cannot live up to.
Positioning a company is more complicated than these simple examples. Many influential factors affect the views of customers, and the speed of development in the marketing environment of many companies has increased significantly in recent years. Cracks in positioning, and marketing communications which no longer reflect the brand in a convincing way due to the changing market environment do not go unnoticed by consumers who show their responses through their choices. When this is the case, you need to figure out where the cracks are and what approach is right for the brand.
When is it necessary to rebrand?
Operational difficulties are by no means the only reason why rebranding may be needed. Any changes in policy focus, innovations in product or service offerings and company mergers or acquisitions may also call for rebranding, as may extensive changes in operating strategy which might make the current positioning of the brand obsolete.
A company can also be pushed off course if market research indicates that there is no consistency between the perception of customers/consumers and the image that the brand wants to create; action must then be taken.
Data collection, analysis and processing should always be a precursor to any rebranding. The cost of getting the right information about consumer and customer perceptions is minor compared to the repercussions of making the wrong decisions. Differences between how managers experience the company and how customers experience it are more common than the managers believe. We all think we know our home environment well, but luckily most of us are also human and tend to see the good in our people and environment more than the bad. Detailed data and hard facts are the best weapons for evaluating and adapting a position.
The ability to adapt has become one of the main competitive advantages of companies in a world of rapid changes. All companies should have an eye on their brand strategy and on customers perceptions of the company. To quote Charles Darwin, it is not the strongest or the most intelligent that survive, but those with the greatest ability to adapt.