Debranding: The great name-dropping gamble
Some say Nike was the first, but now the practice of eliminating the brand name from products or marketing activity is becoming a popular way for companies to differentiate themselves or extend their business.
- “Nobody calls the Mini the BMW Mini even though it belongs to BMW. So why would we call ourselves RBS Coutts?” private banking firm Coutts talks about dropping the RBS branding
- Brand development director at Tesco, Sidonie Kingsmill, on the decision to include the Tesco branding on products or not
- Tony Cortizas, vice-president of marketing, premium portfolio and the Americas Meliá Hotels International, on the branding and debranding in the luxury market
Dropping a well-known company name from a product or marketing activity might seem counterintuitive, but some businesses are doing just that - employing a debranding strategy to make their companies appear less corporate and more forward-thinking.
Starbucks is experimenting with this strategy in an attempt to position itself as a friendly local coffee shop. Its ‘Starbucks’ moniker was removed from coffee cups in the UK last year, leaving only the siren symbol. And last month, its staff started asking customers their names, so they could write them on its takeaway cups, to make its service seem more personal and less corporate. ‘We’re Starbucks. Nice to meet you’ is the line used in the TV advertising that explains this decision.
While some customers might wonder why the chain needs to be on first name terms with them, the marketing strategy has certainly attracted attention. At its launch, Starbucks gave away free lattés for one day, resulting in its highest ever buzz and attention scores, according to YouGov’s BrandIndex, which measures response to brands via its online panel.
But this is not the chain’s first attempt to rid itself of its distinctive corporate branding.
Nobody calls the Mini the BMW Mini even though it belongs to BMW. So why would we call ourselves RBS Coutts?
In the US, the business has experimented with stores called ‘15th Ave Coffee & Tea’, with ‘Inspired by Starbucks’ on them, to provide a more independent coffee shop feel. The chain has also just launched its first Evolution Fresh juice store in the US, where references to the corporate name are entirely absent.
In the UK, Starbucks’ debranding strategy means that no two shops are the same. The chain says that its recently opened cafés in London and Edinburgh are designed to fit into the local environment rather than shouting out its corporate heritage.
Meliá Hotels International vice-president of marketing Tony Cortizas, says one of the first brands to use this strategy was Nike, which has moved away from using its name, preferring just the ‘swoosh’ logo. He adds that Starbucks faces similar issues to the sports brand.
“There is an issue of maturity with a brand. Starbucks’ problem, which is the same that Nike has faced, is that it is everywhere. The saturation of the brand has reached the point where people are [seeing] a Starbucks on every corner. You reach a point where your logo is no longer cool.”
While this isn’t a strategy that Meliá is currently using - in the UK it is working on reinforcing its brand with the launch of high-end boutique hotel ME London this June - Cortizas can see the benefits of a debranding strategy (see Viewpoint, below).
This debranding strategy is an emerging trend that sectors as diverse as finance and fashion are employing to make their brands more desirable.
The private bank Coutts has recently removed RBS from its international logo, following the financial turmoil dogging its parent company. Ian Ewart, global head of products, services and marketing, claims that by removing RBS it is helping to simplify the branding in the UK and internationally (see Coutts, below).
Other brand owners are taking the debrand concept further and having no reference to the parent brand on products, as in the case for most of Tesco’s venture brands. Its Chokablok ice cream, Lathams pet food and its latest launch, Llama’s snacks, show no link with the retailer other than to state in advertising that they are available at Tesco.
Brand development director Sidonie Kingsmill says the retailer carries out research as to whether its name should feature on own-label goods or not (see Q&A, below).
“We consistently do research where we check whether products are better with the Tesco name on or off. Almost without fail it is better for Tesco to be on it because customers get it. They see it as more reliable, they know it is good value and where it is coming from.”
She adds that whether the Tesco name appears on its venture brands also has no hard and fast rules, pointing out that its Naturally Powered cleaning products do bear its branding. She says: “It depends on what is right for that particular product.”
Having these venture brands that are developed by the retailer and exclusively available in its stores helps to encourage shoppers into Tesco. The products can be offered at lower prices than other branded goods because little money is spent marketing them, claims Kingsmill. However, she doesn’t feel that they are necessarily debranded products, being strong brands in themselves.
The US store JCPenney is another brand that has developed separate ranges that do not use its name, including The Original Jean Company and Xersion. After posting an operating loss of $171m (£107m) in the third quarter of 2011, the business is restructuring and is using a debranding strategy to help push forward its private label brands.
JCPenney declined to comment, but a statement from the company says that newly appointed senior vice-president of strategic brands Bill Gentner will be “responsible for reinvigorating JCPenney’s portfolio of high-performing private brands, including ensuring brand integrity in how they are merchandised, marketed and presented in the company’s private brand in-store shops.”
The revamp comes in the wake of the end of a deal with Ralph Lauren, which produced garments exclusively for retailer JCPenney which were marketed under the American Living label - no use was made of the Ralph Lauren branding.
Senior vice-president of advertising, marketing and corporate communications David Lauren has previously explained the strategy to Marketing Week. He said:
“We have started brands from scratch like American Living which do not say Ralph Lauren and they reach a totally different customer.
“No, they do not know [that Ralph Lauren makes American Living clothes] and it does not matter, it is just us reaching a customer who is looking for less expensive products and in a store where we would not sell Ralph Lauren products.”
Other luxury brands are experimenting with whether their logos should feature on products or not. Gucci is working on finding a balance here, to make sure that it reaches ‘the more sophisticated end of the market’, presumably in response to its logo being flashed on handbags by those in the public eye deemed ‘unsophisticated’. Parent company PPR says: “This new strategy is not simply based on finding a new balance between logo and
no-logo products, but also on defining the appropriate mix of fabric, leather and precious materials.
“The success of this means that today the brand has achieved an enhanced positioning and exclusivity, recapturing the more knowledgeable clients as it continues to attract aspirational customers, especially from the newer markets, with an increasingly higher average price-point.”
Indeed, Gucci says it is moving towards an emphasis on logo-free leather products, contributing to a 25% increase in annual profit to nearly €1bn (£837m), as reported in February.
Other brands are using debranding in their advertising to appeal to specific audiences. Unilever’s VO5 Extreme Style hair products were advertised last year in an unbranded ‘teaser’ TV spot, later followed by a branded commercial in the same style. It featured the ‘Pliktisijiteur Pageant,’ a show in a fictional village and set early in the 20th century.
Brand manager Richard Whitty says the focus of the campaign was engaging content rather than pushy branded ads. “It was all about the story, it was about a village and its talent show and pageant. The more focused you can keep it to telling a story rather than pushing a product, the more sharable it is.”
Targeted at 16- to 24-year-olds, the aim was to get the video to go viral. “Giving them something unbranded adds to the product’s credibility. This is about building brand equity, it is not just about pushing products and saying ‘how many extra pots of fibre putty can we sell on the back of this?’”
Indeed the teaser has now been viewed 130,000 times on YouTube, and the following branded advertisement 214,000 times. The full 90-second version will run in cinemas later this year.
Whitty says this strategy helps to differentiate VO5 from the other brands he also manages, including the recently launched Lynx hair products and Brylcreem. He explains: “We have been watching closely how sales have been affected since the advertising went live. We have spent a long time pulling apart those two brands [Lynx and VO5] and very much see a Lynx user as entry-level, whereas we see VO5 users as more confident and experimental.
“We’ll be watching how sales of VO5 are affected by the Lynx launch, but our feeling is that the two attract different customers.”
As businesses continue to experiment throughout 2012 with a debranding strategy, it appears that just churning out goods and marketing activity bearing famous brand names is no longer a winning strategy.
Last year, RBS Coutts, the international arm of the private bank, dropped the RBS initials from its logo, becoming simply Coutts, as it appears in the UK. This followed the arrival of chief executive Rory Tapner in 2010, and Ian Ewart, global head of products, services and marketing in 2011.
Being associated with RBS and the negative press it has attracted in recent years could be seen as a risk for the private banking arm, which prides itself on serving the very wealthiest people, including the Queen.
While Ewart claims that being associated with a bank, which is majority-owned by the state, isn’t a ball and chain for the private bank, he says dropping the RBS moniker has made it clear who the business is aimed at.
“Clearly RBS is one of the biggest banks in the world, it is still fantastic to have an organisation of 160,000 behind you.
“But nobody calls the Mini the BMW Mini even though it belongs to BMW. So why would we call ourselves RBS Coutts? It just makes for confusion,” he says.
The rationale behind the rebrand has been, in part, to reach consumers in eastern Europe, the Middle East and parts of Asia where it has less of a share of voice. It wants its overseas business to be worth about 60% to the UK’s 40% as part of its five-year plan.
“[The brand] had to be immediately understood in the different geographies, and for people to say ‘yes, that will help me do more business’,” says Ewart.
The bank has pulled out of several countries as a result of the strategy, now operating in 76 instead of the previous 172. The bank only wants to have a presence in countries where it can achieve a 3% market share.
“We sold some of the business to Royal Bank of Canada as part of this strategy to not have clients everywhere. We will try to make sure we have at least 3% market share in the places we service and to do this to a high standard rather than trying to spread ourselves too thinly,” says Ewart.
The new Coutts brand and logo was taken around the world by Ewart and head of marketing strategy Sarah Wyse, who explained to staff about the new values of the bank: connected, cosmopolitan and human.
“We discounted a lot of the language that tends to be used in the industry - expertise, intelligence and insight for example. We wanted our values to be something the whole business could understand.”
Wyse claims that the removal of RBS from the logo, and the new way of thinking about the business is helping RBS and Coutts work more closely together. “When we had two brands, it was all about thinking what could we as a brand do. It was Coutts and it was RBS Coutts. We didn’t see much evidence that they talked to each other or that they aligned in any way, but now it is quite collaborative.”
Q&A: Sidonie Kingsmill, brand development director, Tesco
Marketing Week (MW): Why does Tesco research whether the brand name should feature on products or not?
Sidonie Kingsmill (SK): When one of the [people managing the] categories wants to bring a product to market that doesn’t exist yet, they prefer not to put Tesco on it because customers won’t understand. We say we think we should put Tesco on it because it will help them understand it. To resolve the argument, we talk to customers.
MW: Are there any examples of product lines where you have considered whether or not to include the Tesco name?
SK: Recently, we talked about it in the world foods area. We are seeing massive growth in our ethnic foods section whether that be Polish or Asian or Halal, for example. We have been having discussions about whether the Tesco brand would work here, and we think it does.
You might think that people wouldn’t want to have Tesco on a Polish sausage but the reality is that it helps them believe it is a reliable, good quality product.
MW: You look after venture brands in your role, which mostly don’t have Tesco branding. What’s the thinking behind this?
SK: We are looking at what we can sell that is exclusive to us, to provide a reason for people to come to us rather than go elsewhere. We want to be innovative in some of those products as well, not just trying to do good versions of other types of products such as ketchup, cornflakes or nappies, which is what own-label is.
We thought we could use a combination of our strong customer knowledge combined with access to the best suppliers around the world, put a bit of marketing in, but nothing like the amount of marketing the big brands do [so we can offer them at] lower prices.
MW: Will Tesco continue to invest in venture brands in spite of poor Christmas sales and a management shake-up?
SK: Yes. Being a continued creator of highly valued brands, as [chief executive] Philip Clarke puts it, is a central plank in our global strategy. It is an element that we are experimenting with and will continue to invest in.
Some people look at this approach and think that Tesco is bringing brands in that are a danger to big established brands. But that is a complete misunderstanding of how a retailer runs its business. Every one of our brands has to pull its weight; it has to have the rate of sale and be worth stocking otherwise it will be taken out.
The venture brands are not things we are trying to take over the world with; we’re just trying to provide customers with solutions. If they work, they will stay, if not, they will go.
MW: How will you market the venture brands this year?
SK: We have very tailored plans for each brand. We’re looking at social media and online a lot more than last year and have picked categories that customers are particularly engaged in. Ice cream [with venture brand Chokablok], for example, is something everyone loves. And while people don’t always talk about feminine care [fulfilled by Halo], they are still very engaged in the category. We think because they are engaging areas, they are a perfect fit for social media.
Tony Cortizas, vice-president of marketing, premium portfolio and the Americas Meliá Hotels International
A brand is not a logo and a logo does not a brand make. It is about the experience. It is one thing to announce your arrival then get your share of voice and build your reputation. But then [there comes a point when] everyone knows you; you’re no longer new.
So, how does a brand stay desirable? In terms of luxury brands, if there is a limited edition £30,000 handbag, does it need a logo if Kate Moss is seen wearing it? Her social equals might realise [the fact that it is a special, designer bag], but if no one else does or it takes them months to find out who made it, it means the brand is rebuilding cachet.
[Some luxury brands] have gone from exclusivity to considering how to go mass-market. Mercedes, for example, created more accessible sub-brands. That might be great if it sells more cars, but perhaps the traditional customers, who are really its brand ambassadors, might start thinking: ‘What is the big deal about Mercedes - everyone’s driving one these days?’
So perhaps Mercedes could create a limited edition without the logo that people will recognise by shape or design but only you and a few others will know [what it actually is]. This way, you are recreating and somehow separating the brand.
I think the only danger of this is what a brand does afterwards to make sure the business isn’t being split. You have to make sure you don’t split your brand in half and leave [one half] in the mass market that you don’t want - and, if you’re not careful, that [will be seen as your brand].
When debranding goes wrong
The debranding strategy is at risk of going wrong or appearing too clever. For example, last month, Sony Pictures released a debranded DVD of its film The Girl with the Dragon Tattoo, in the US. It looks like it has been homemade, simply stating the name of the film in marker pen on a plain silver Sony disc. However, this has caused confusion among consumers, who assumed the DVD was a fake and tried to return it to online stores.
US Film rental website Redbox.com has been forced to put an explanation next to the DVD’s description saying: “The handwritten look on the disc of this movie is legitimate and is intended to look like a burned DVD.”
While the idea of a ‘homemade’ disc might go with the hacker theme of the movie, making it look totally unbranded has backfired. It looks out of place and has confused people because it does not match the slick marketing and photographic design that the rest of the merchandise features.
Other debranded movies have made the strategy work, for example the movie Borat, starring Sacha Baron Cohen as a Kazakh journalist visiting the US. The DVD has ‘Borat’ scrawled across it in marker pen, but it works in this instance because it goes with the personality of Borat as well as the film.