Arrogance has killed many American brands… They once basked in their own pride, but today lie in coffins gifted by new-age brands.

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Walk up to a teenage coffee lover and ask him if the word ‘Brim’ strikes a familiar note. Don’t be surprised though if he gives you a wrinkled ‘what a weirdo!’ look. How on earth would he know what ‘Brim’ is?! Its ads had stopped flooding media machines decades back and the brand itself has been jettisoned from retailing ships for much over a long decade! Dead… and its memories just a ghost from the past! Move onto something cold – call it ‘Tab’. Remember the name? Don’t worry if you can’t, for it’s another one from the morgue. Tab was the predecessor of Coca-Cola’s current Diet Coke, but with time and lack of innovation in taste, it began to fizzle out. At present, the Tab formula lies inert in Coca-Cola’s labs, waiting for an American re-branding miracle...

These were just two ‘glorified’ brands which once basked in the American sun of glory, and were all set to capture global centre-stage. They lost their hue partly for lack of innovation and primarily because they were just too arrogant and obstinate to change, as Jeff Kagan, Telecom industry expert asserts, “American brands need to keep competitive threats in mind. Once successful American brands can stumble. They need to reinvent themselves...” What follows is an account of a few such ‘once great arrogant’ American brands that suffered from the very two reasons mentioned above, and are dying today.

Levi’s, which once ‘proudly’ swore to clothe the world with denim is a mirror image of what it was 24 years back when Robert Haas bought an almost dead brand and closed dozens of production units and subsidiaries, and brought the organisational ‘core’ focus back. Having taken the company semi-private a year later, he infused new life into the brand. Levi’s was a known brand again and its stock price was kicking, having risen from a mere $2.53 to a swashbuckling $265 in just a year! But with time, and for lack of consumer focus and customisation (its ‘One size fits all’ strategy), revenues and profits for the brand is drying quarter after quarter as a spokesperson confesses, “The mistake we made was to make one brand for everyone – it ended up being nothing to anyone.” In the past eleven years, the company has given the royal kick to 17,350 employees (including its CEO in 2007) and has put the locks on 33 factories across North America and Europe. What growth! So what led to this dangerous situation? While companies which focused on maximising wealth – like Honda, GE, Toyota, Unilever et al – rushed to low-cost Asia, Levi’s put it’s foot down to manufacturing products in America. It was too proud to allow its products to be manufactured in Third World geographies!!!

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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