Branding Strategies

Killing Brands Successfully

Vital Few and Trivial Many

In a paper that seeks to explain why one should kill something that has taken years to build, it is fitting that one talks about the much-used but misnamed Pareto principle. The Pareto principle tells us that 20 percent of something is always responsible for 80 percent of the results. This is a fairly apt way to describe the situation with many multi-brand companies today. Diversifying across segments and product lines, companies had launched and re-launched brands, both old and new, to safeguard against risk.

However, since the 1990s, more and more companies are realizing that their innumerable brands far from adding value to their business are nothing more than dead wood. The famous 80% is contributing to less than 20% of the bottom-line. What is a company to do? Merely grin and bear it? Or attempt to make those brands redundant? How does a company get rid of such brands without losing or worse antagonizing loyal customers? And what should the company do with the profits thus generated?

Motive behind the crime

Visualize if you will a hard, white golf ball which is the product or service while the translucent, multi-colored sphere of gas the size of a large balloon surrounding