Many retail companies are struggling in today’s world of commerce. There are price wars eating up margins and e-commerce cannibalism ebbing away at brick and mortar sales; so retailers are switching up marketing strategy and reshaping their brands. The reasoning behind a rebranding is to either reach previously unreached customer bases or to reengage with former (or current) customers who have become disenfranchised with the brand – and this can be achieved by changing brand perception.
Transforming a brand is both difficult and time consuming. Companies trying to keep up with the ever changing retail environment must be willing adopt change and adapt their marketing strategy appropriately – this is necessary to stay in touch with the ever evolving consumer. However, this process, if not carefully curated and effaciously executed, will, undoubtedly, alienate customers already loyal to the brand or fail to engage with new ones. This can give companies major headaches, especially if they are unable to replace sales lost to their original customers or are incapable of revitalizing excitement about their brand.
1) NEVER make assumptions about your original customer.
Thorough marketing research must be undertaken to recognize how the original customer base will react to change. Change is inevitable but offsetting the potential backlash by tailoring marketing appropriately, will act as a buffer against some aversion to this change. If a new strategic move is aimed at selling to people aged 60 and over and the original customer base is young adults, how is the brands transformation going to appeal to the new market while still retaining the original one?
2) How will it affect company employees?
The new elements of the brand need to be permeated throughout the company. Rebranding will change the ethos of the brand, which will not only affect customer interaction but also the thoughts and feelings of employees. Management focus is normally pinpointed on the customer during the process of brand transformation; however, is it vital they pay attention to how these changes will affect employees. Making sure employees are engaged with a newly developed brand culture will clarify what direction the company is going in.
3) Is this change improving the value proposition?
The obvious answer should be yes. However, is this being effectively conveyed through the brands marketing? Value doesn’t necessarily have to mean benefits and features; it can be the emotional benefit through a brands service or product. Successfully communicating value through the rebranding is crucial to improving brand equity.
4) Is rebranding going to increase sales?
If the transformation is an extreme one, it is more than likely some original customers will become disenfranchised with the brand. If this is the case, is the attainment of new customers going to replace these customers in greater numbers? and are they going to spend more? If a rebranding is focused on revitalizing the brand, and the objective will be regaining the interest of previous (or current) customers, is this new found interest going to have them spending more?
A rebranding is pointless if the end result is a large loss of original customers and an insufficient quantity of new ones; furthermore, it is also pointless if the new face of the brand fails to reignite the loyalty of previous or current customers. Overhauling a brand is about changing consumer perception but this is irrelevant if it does not boost sales.
5) Customers must be informed how to use technology alien to them.
Many retailers are attempting to modernize their brand. Allowing customers to utilize modern technology – in an attempt to enhance their overall shopping experience – is a sign the brand is contemporary and relevant. However, people who are not familiarized with this technology can become frustrated. This frustration arises if the technology is difficult to use or if the customer is not provided with the relevant information on how to use it.
An easy to follow (preferably hands on) demonstration on how to use this technology, will ensure people are not put off or confused when using it. A good example is a loyalty card: if the card has to be registered online will a customer know how to achieve this? Will they need guidance? If a person finds it difficult to access promotional offers then they will be deterred and this, consequently, will hurt the brand of question.
Changing the face of a brand by offering new product assortments and renovating the logo, is a necessary strategic move for companies attempting to evolve their brand. Rigorous competition, modern buying patterns and growing incomes are just a few of the existential justifications for brand transformation – especially in an era of omni-channel and the countless subtleties of consumer behavior. Combining the new with the old can be a precarious move, and throwing the old out entirely is a complete leap into the unknown! Successful rebranding requires a carefully thought out plan, which needs to be implemented to perfection. Taking time to go over the 5 considerations above, prevents a retailer from falling victim to the numerous traps laid out in front of them. Avoiding these traps is essential to achieving a smooth, successful rebranding.