This post looks to explore why some well-established brands fail.
Introduction: give me some sugar
Henry Tate (1819 – 1899), the proprietor of Tate & Lyle sugar, once described the nature of his highly lucrative business: “[I] pull on a string and gold sovereigns come tumbling down”. Tate & Lyle sugar is still a highly valuable brand today, and it remains a truism that great fortunes remain to be gleaned in the consumer goods sector.
Once a brand is well-established it seems relatively straightforward, as Mr Tate implied, to sit back and watch the money amass. But that negates to reflect the intrinsic difficulties of brand management. What I find to be more inherently illustrative is when a well-established brand declines and ultimately fails. What causes the brand to fail, and what lessons can it demonstrate?
Quarrelling families are a subject as old as time. However they can cause havoc for a family-run enterprise. Nathan Baraf Walters (1867 – 1957) developed Palm Toffee and became one of the largest toffee manufacturers in Britain. However he refused to pass on the business to his four sons. The sons contested their father’s will in the Probate Court, and the QC reflected, “unhappily this family was riven with difficulties and troubles for years. I dare say the deceased bore his share of responsibility for them”. The business was subsequently subjected to a takeover by Holland’s toffee, a larger rival. The Walters factory was immediately closed, and the Palm Toffee brand disappeared.
Gin fails to blossom
The Distillers Co acquired much of the English gin industry in the early twentieth century. Marketing strength was consolidated behind Gordon’s, their leading brand, and long-established brands such as Booth’s (est.1770s), Boord’s (1774) and Vickers (1820) withered from neglect.
Showerings was a small brewery business in rural Somerset. They introduced Babycham sparkling perry in post-war Britain to immediate success. Showerings operated the largest bottling plant in the world by the late 1950s. At its height, 90 percent of licensed premises stocked Babycham. But annual sales plummeted precariously from 144 million bottles in 1977 to just one million in 1993. The conventional explanation suggests that Babycham ceased to be fashionable. Was this a failure of marketing or was a decline in the public perception of the brand intrinsically inevitable?
You butter believe it
James Epps introduced instant cocoa to the mass market. At its peak Epps & Co processed half of all cocoa imports into Britain. But the business failed to respond to rivals such as Cadbury and Rowntree, who introduced the Van Houten press to remove some of the unpalatable cocoa butter from the product. The business declined over time, and was eventually acquired by Rowntree, and the Epps brand disappeared.
Whilst far from exhaustive, this post sketches some reasons why brands can fail: management and family disputes, consolidation, poor marketing and a failure to respond to consumer demand.