There are few other areas in your business that can lead to such as positive outcome or have such a devastating impact on your business. Knowing when and how to either stay on or move away from brand is critical to the long-term health of your business.

Powerful brands maintain their brand equity over a long period of time.  What made them great often keeps them great, but only if they stay on brand and it continues to remain as relevant to their target markets.

The business world is littered with examples of very large and successful companies that moved away from what made them great brands.  AT&T, known as a communications company, moved into computers.  Harley Davidson tried to introduce a line of perfume. Colgate attempted to sell prepared food. Gerber offered a variety of baby foods to older adults.  These are all disasters that demonstrate what happens when a company tries to introduce a product that is simply not within the umbrella brand's ambit.

But moving away from brand isn't just restricted to new product blunders.  It's moving away from what you're known for and goes to the core of your company's value proposition.  It can be a change in the services you provide, the messages you send to the market and indeed the very market you target.  Badly managed, any of these will do your brand and your business harm.

What are the dangers in moving away from your brand?

• Brand damage.  It takes an investment over many years to build a strong brand and a relatively short period of poor brand management to destroy it. You may never recover lost ground.


• Weakening your competitive position. As soon as you open the gate, your competitors will take advantage of it – in many cases, permanently.


• Increased attrition and decreased acquisition of clients/members/customers.


• Weakening your business' long-term value.  Healthy brands bring tangible value to company balance sheet.

Why might a financial services business move away from its brand?

• Trying to be everything to everyone.  A super fund with an industry-based heritage forgoes its industry focus for the lure of more members from a broader market.


• Short-term motives.  A financial planning business forsakes long-term referrals for sales tactics that glean higher immediate profits.


• Too many product extensions.  A bank introduces so many products that its umbrella brand loses all meaning to its customers.


• Success breeds complacency.  A successful insurance company inadvertently drifts away from its brand over time because profit is good, but it's not keeping tabs on the leading indicators of its declining brand health.


• Growth for growth's sake.  A credit union commits a litany of marketing sins in the quest for growth.  Not the least of which to move into life insurance, which it is not known for.


• Size. The larger the business grows, the further a CEO of a mortgage originator gets pushed away from customers and the more out of touch she gets.

A poor (or non-existing) brand management program will allow many of these types of branding mistakes to occur in the natural course of doing business.

As brands have a natural lifespan and exist in an increasingly competitive environment, occasionally they must be refreshed.  Brands must change as the target market changes, yet retain their original values. The key here is staying relevant to your market while respecting your brand heritage – often the very thing that made your brand strong in the first place. 

But branding creates a bond with customers/members/clients, so do not change it casually otherwise you may damage what you have spent years building.  Tread carefully here.

There are also plenty of companies that stayed on brand when their markets were shifting and suffered the consequences.  Levi Strauss stayed on brand even though its market was shifting away from the jeans that made it legendary. Digital Equipment Corporation continued to only offer servers when the market was shifting to personal computers. Yahoo continued to offer a full service search directory when the market was shifting to the ease and speed of more rudimentary search engines (eg. Google). 

What are the dangers of staying on brand (when your market shifts)?

• Loss of brand relevance. If the market changes and you don't, there will usually be consequences.  Your brand must evolve to remain relevant.


• Loss of market share. New or existing competitors that do a better job at being relevant to your target market will pick up some of your clients/members/customers.


• Missed opportunities. Market shifts can present significant opportunities for increased revenue and improved market acquisition that may be lost if your brand is not as relevant.

Why might a financial services business stay on its brand despite major shifts in its target market?

• Eye off the ball.  A super fund doesn't do the right type of research often enough to track and understand shifts in their market. The fund can't react to what it is not aware of.


• Why change a brand position that's always worked?  An insurer figures what made it a success in the first place will see it through thick and thin going forward.  This is particularly the case where the CEO or marketing head has been with a company for a long time.


• Poor brand management skills.  Despite knowing there is an issue, a bank decides to 'dig in', further alienating its brand from its market.

It's certainly true that increased competition, more dynamic industries and rapidly changing markets are stretching brands and putting them under more strain than ever. But if brands are managed under the stewardship of skilled brand managers, they have a much higher probability of taking the right actions at the right time. 

The key is to have brand tracking in place to measure the leading indicators of your brand's health and to understand shifts in your target market. You can then take well-informed action to ensure that your brand continues to stay relevant while continuing to pay homage to what made your brand great in the first place.

Bruce Stafford