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August 20, 2007

Comments

BSV

Wal-Mart's stretch to prescriptions is a natural if they can keep them cheaper than the rest. But, with cheap comes the perception of inferior quality, and that's not what i ever want to associate with my medicine. I'll guess an eventual flop on that extension.

As for the upper-scale shops, if they can put a new moniker on it and maintain many of their economies of scale through the host brand, I don't see why they should fail.

Samsonite is just plain wrong. It'll never work, or it will take so long to establish itself, it won't be worth it.

BSV
http://rblb.wordpress.com

PrintPlace

I don’t think that Wal-Mart can ever be linked to an affluent taste. I mean, Wal-Mart to me, means anti-affluent. I think the $4 prescriptions has worked because Wal-Mart has made prescriptions “cheap” – back to their brand of cheapness. I might check out an affluent Wal-Mart store, but I don’t think I would ever buy anything b/c I would think in the back of my mind that it’s all cheap stuff that was just marked up.

Roy Hewitt

Hi Jennifer,

You and your article stopped me to ponder. You remind me of Casey, a character in Noble House, a novel by James Clavell.

Thanks. Roy.

Jonathon Narvey

Interesting post. One thing a company can try to do before it experiments with stretching is figuring out exactly what consumers already thing about it. I recently blogged about Brand Tags, a fun little app that allows you to see exactly what people imagine when your company name comes up. The post is Brand Image: What's In A Word, at http://writeimage.ca/blog/2008/05/13/brand-image-whats-in-a-word/. Cheers!

andrew

In Samsonites case, the crucial question is whether the actual product delivers on the promise.

Take a look at the new Samsonite range of suitcases - they are very designer led & they have certainly done a great job in their new product development.

It would be extremely hard for Samsonite to reposition its brand if they were producing the same old suitcases, but this couldnt be further from the truth.

I'm sure with a sound marketing strategy, they will be able to reposition the brand to appeal top the higher end market, whilst also staying aspirational to the lower end market.

As you say though - time will tell.

Lei Zhang

Hi Jennifer,
Great posting! I must have to agree with you that it is not easy for a famous brand to make a change! People like freshness but hate changing, say nothing to the huge transition. Compared with Wal-Mart and Samsonite, the latter probable has more opportunities to win this war. In the previous, the image of Samsonite in the eyes of consumer is durable. Right now, it adds stylish into the products. There is no conflict between durable and stylish. Thus Samsonite still has chance to win. But for Wal-Mart, the situation is kind of different. “Affluent” and “cheap”, how could it be able to handle both of them? I am very curious about that!

John Furgurson

Sampsonite as a high-end brand to compete with Coach??? Now that's a stretch! They'd be a lot better off developing an entirely new brand.

servizi cartomanzia

i found your article really interesting, thank you very much for your suggestions!

Piotr Jakubowski

I would have to agree that reshaping Wal-Mart as an urban footprint store would be a Sisyphean task, and it would take a large amount of work and effort to do so. I think the best way to go around this is sub-branding. Although, as a previous comment suggested, some people still haven't set foot in a Wal-Mart store, they understand the "cheap" stigma and all other stories surrounding it. Many people also refuse to shop at Wal-Mart, preferring other options instead.

At the end of the day it seems an arduous task to try and shape one's brand around the need of a both high and low end consumer. Would Toyota really consider releasing cars to try and compete with the luxury of BMW or Mercedes Benz? That would be foolish. Then Lexus came along :)

Jimmy Carson

This is a great discussion. There is a heated one going on at www.mootee.typepad.com on a similiar topic. I fully agreed with jennifer's comment.

Shafeen Charania

A brand accrues value for its owner. Its impact is measured by the "positiveness" of the predisposition it helps form in the target audience's mind, say by how it helps accelerate sales and lower consideration friction.

Both your examples smack of trying to expand the size of the market pie, given that they already own a dominant share of the current pie. But they're looking to do this with choices that also alter their "brand pie".

Starbucks, Virgin and others have done this really well but have stayed within their "brand pie".

Are there examples of companies that have successfuly expanded market presence while at the same time altering the essence of their brand & what it stands for?

Threerooms

Hi Jennifer,

I agree with the hardships of stretching a cheap brand into the luxury market. The brand already has an established image and perceptions are already firmly set in mind.

I wrote a disstertation on a similar subject. A high class supermarket chain in the UK bought an established cheap grocery store chain in 2003. The high class brand decided to rebrand the cheap grocery store with a combination of both brand names. Therefore the perceptions of both brands, now one new brand were conflicting.

It was sending the wrong message and distorting the established image. From the research I conducted, once loyal consumers of the cheap grocery brand stopped shopping at the stores. With an overall reduction of 23% of consumers. Sorry I am waffling on now. It was an interesting report with unbelievable results.

Chris
www.threerooms.com

Matthew Healey

Jennifer, glad to see you still posting!
While I agree with you that Wal-Mart's brand is 'cheap' rather than 'groceries' and it may have difficulty stretching to 'upscale', keep in mind that there are segments of the U.S. population that have never set foot in a Wal-Mart in their lives - Manhattanites, for instance - and might possibly be open to a redefinition of the brand. Not likely, given Wal-Mart's notoriety, but possibly. Witness all the upscale McDonald's restaurants in Europe.
It will depend on how much commitment Wal-Mart is prepared to put into this new direction. If, as Guy suggests, this is just the whim of a here-today-gone-tomorrow brand manager, it will fail. If they stick to it, they might just pull it off.

Guy Fish

It always seem like more of a ego exercise when companies swallow the "new" luxury brand rather than keeping it as a stand alone. It's as if someone at Samsonite has an inferiority complex. "I don't like the stuff I make, maybe this will make me feel better."

Tom Asacker

Stretching a brand is like wearing spandex. Just because you can, doesn't mean that you should. Welcome back Jennifer. Nice photo!

jennifer rice

And what is a brand? It's a collection of associations that do not necessarily correlate to the industry in which the company operates. IMO, it's easier to create adjacencies to the same target audience than to try to shift your brand to be relevant to a different target audience. Because, as you point out, you can't be everything to all people. I think Wal-Mart's healthcare initiative will strengthen their brand among their existing target audience. They're just creating additional affordable products/services to the same group of people. For more on this subject, here's a longer post: http://brand.blogs.com/mantra/2004/02/positioning_deb.html

Chris Wilson

No matter how you spin it limbs extending past a brands stretch do nothing more than weaken the existing brand.

Like Jack Trout and Al Reis would say,"You can't be all things to all people."

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