Posts Tagged 'Brand equity'

Target’s brand position: We’re easy

Target is focused on “ease of shopping” as it refines its brand equity. My question (from RetailWire)…is it a credible claim, and can Target really sustain a competitive advantage here? Here’s my comment:

What makes Target “easier” than Walmart or Amazon? It’s a good tagline but is it supported by the facts? Target has a reputation for stockouts and other supply chain issues that a slogan by itself won’t cure. The company has a lot to prove, especially in light of Walmart’s laser focus on the same issue. Case in point: The new Walmart ad where the dad drives through in his PJ’s to pick up breakfast-in-bed fixings.

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Can retailers build brand equity by themselves?

I argue on a recent RetailWire post (below) that retailers are not nearly as adept as branded vendors at building equity through emotional engagement of the consumer:

Brands are better at emotional engagement than retailers, and this has been the case for a long time. While there are exceptions like Nordstrom, most retailers are unwilling to do the heavy lifting needed to turn satisfied customers into committed ones. The perfect example is the large number of so-called “loyalty programs,” which are really focused on price incentives instead of true loyalty.

Not every CPG company is equally adept at building brand equity, but most of them put retailers to shame. Retailers’ move toward more private and exclusive brands is just complicating this issue.

National brands: Enough spending on “equity”?

Are national brand marketers spending too much on sales promotion with their retail partners, at the expense of long-term brand equity? Here’s my point of view:

It’s hard to separate this topic from the recent discussion about partnership (or lack thereof) between national brands and their biggest retail partners. (The last post centered on the conflict between Costco and Coca Cola.) While it’s easy to say that national brands have sacrificed long-term equity by cutting their marketing budgets, it’s also hard to argue that retail consolidation has forced serious rethinking of overall strategic spending.

Certainly the retail landscape was much more diffuse 25 years ago; power has become much more concentrated in the hands of companies like Walmart that were barely noticed in the early 80’s. (And at the same time there is far less concentration among a few media outlets, with many more choices for ad spending among cable networks, digital media, and so on.) So the national brands who intend to spend against “equity” need to deal with the reality that they must allocate more dollars than ever before to keep their key retail accounts happy.

Target’s private label redesign misses the bullseye

Today’s Retail Wire posting comments on the new private-label branding and packaging at Target called “Up & Up” — this will appear in HBA and other commodity areas. I start by quoting Kathee Tesija, the GMM involved in the project:

Ms. Tesija’s logic is backward: “We believe that it will stand out on the shelf, and it is so distinctive that we’ll get new guests that will want to try it that maybe didn’t even notice the Target brand before.” New guests (or customers, as the rest of us call them) are unlikely to walk into a Target store for the first time in order to buy a private label they never saw before.

More important, one of the key ingredients in Target’s brand equity is the red bullseye logo. Almost every other company in America (retailers and others) would kill to have a logo this recognizable and powerful. Target is certainly within its rights to rethink its private labels, and many other private-brand categories in the store do not exploit the bullseye. But did they have to come up with something so bland and unmemorable?

A&F’s pricing strategy: Brand integrity or bad timing?

There’s been a lot of discussion recently about Abercrombie & Fitch, and their well-publicized decision not to discount their product last fall in the midst of the consumer/retail meltdown. My perspective is that “brand integrity” only goes so far, at the expense of losing long-term market share to key competitors. Here are some other comments from Retail Wire:

When higher-end competitors like J. Crew and others are taking steps to be more value-oriented (adjusting their regular prices, running more in-store promotions), A&F sticks out like a sore thumb. It may be noble to stand for “brand integrity” by failing to offer cash-strapped customers better value, but A&F has made a couple of strategic missteps as a result. First, they have allowed most of their competitors to gain market share at their expense. Second, they have undermined their own message by painting their merchandise content as “too expensive” in the consumer’s mind. Third, they have done a disservice to their own shareholders by sitting on their hands, allowing a comp-sales and clearance meltdown to occur.


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