What to do with a commoditized brand

There was a great post put up by Scott Weisbrod in early March at his blog EP / Experience Planner about Starbucks (Starbucks: A Brand In Decline? Suggestions For Growth And Change). The essence is that Starbucks has been forced (due in part to reduced stock process) to looked inward and re-evaluate their brand. They have lost some credibility for the sake of efficiency. They have become a coffee shop instead of a coffee experience. In Chairman Howard Schultz’s own words, “we have had to make a series of decisions that, in retrospect, have led to the watering down of the Starbucks experience and what some might call the commoditization of our brand.”

So what do you do with a commoditized brand? The answer usually lies in re-invention. The focus changes from efficiencies to investigating the industry landscape, identifying the market need based on the success and failures of your products as well as competitive products. What’s working? What is the market embracing? What are the pundits touting as the next best thing? Look beyond just your product sector at broader product, marketing and design trends. Apply these things into either a revised version of your product or pull your product into a new sector. Take your revised product and establish a new category that you become the leader of by default.

Look at the broader consumer trends (even if you are a business-to-business company). For example there is a sea change in the reality shows, moving away from some of the more soap opera like shows (Survivor, Big Brother) to professionally oriented contests. Shows like “Grease the One That You Want,” “Tops Chief,” “Top Designer,” etc. are about professionals rising to the top of their game. What does that reveal about the market as a whole? Is there a way that you can leverage this into your product, messaging and communications strategies? Can you even use the shows themselves for product placement? This is just one example among many.

Lee Iacocca’s case study for leveraging market trends is the mini van. Chrysler examined what the new consumer culture was doing. The baby boomers had kids and gear. Their lives involved more carpooling; the traditional car wasn’t as delivering or meshing well enough with these new lifestyles. Lee and his team invented the mini van and positioned it to this soccer mom audience. Apple recently did this with the iPod, how can you do that with your product? What is your next mini van, or iPod? While research and market sizing is still important, thinking and observation is imperative. The creative part of the equation is essential. Having conversations with your customers is crucial. Listening to the breath of the market is the only way to delver back what the market will embrace. This isn’t marketing this is thinking.

From a practical marketing perspective Scott Weisbrod ‘s post sums it up perfectly offering sound, fundamental marketing advice directly addressing Starbuck’s problems:

EXCERPT FROM SCOTT’S POST:

Some specific ideas for growth include the following:

·        Re-invest in the customer experience - The customer experience makes the brand and Starbucks, while still a powerful brand, needs to get back to customer experience basics and renew the intimacy it once had with customers, solve the long line-ups created by inefficient drink making processes and re-establish Starbucks as the “third place” in customers’ lives following home and work.

·        Re-discover its core business in coffee - Schultz believes that Starbucks sources and buys the highest quality coffee available. High quality coffee is a differentiating attribute; as a result Starbucks should focus on product differentiation if this is in fact the case. Starbucks can reinforce differentiation at every customer touch-point whether it be the merchandise in store, marketing communications, or their web site. Differentiation also includes rediscovering and promoting Starbucks’ heritage, tradition, and passion for the coffee drinking experience.

In short, Starbucks needs to get back to basics and focus on the customer experience and product.

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Comments

[Dale Wolf]

Starbucks is only one of many mature brands that seem to get lost along the way of putting efficiency ahead of experience. Put most of the airline and cell phone companies in that same boat. You might find John Todor's take on Starbucks and the customer experience at www.perfectCEM.com useful in rounding out your concept of designing a product based on customer insights.

Another good example of a big successful brand that has lost its way is Dell Computer. They literally owned this category because of the experience they created for customers and fell so far down that they had to bring Michael Dell back to CEO the firm ... he understands the nature of customer experience and the management that took over when he removed himself from his active rule put the business in a downward spiral. Dell will need to look deeply into what customers need and aspire to so he can create a new, highly valued, consistently delivered experience that differentiats Dell Computer once again. It's really something we can never put on automatic ... the experience has to be continuously re-invented.

[Scott Weisbrod]

Thanks for highlighting my post on Starbucks!

I had stumbled upon your blog via MyBlogLog and have been digging it! Great work.

Cheers,
Scott