Brand today is not ‘something’ in marketing, it is virtually ‘everything’! If we leave the niche markets aside, a majority of the brands compete on similar product qualities, and in the end the final consumer choice to a large extent is dictated by the concept called ‘Brand’. So, corporations which are able to capitalize on this concept, and hold on to their strengths are the ones which are able to extract maximum from the markets, while the majority of others simply flop. In fact, some of these failures are so interesting that having a look at them entails a lot of learning in itself. This article would dwell upon some of the most striking brand failures and the reasons behind these downfalls.

New Coke

The failure of New Coke is perhaps the most prominent failure of a super established brand. After more than a century of its existence, in 1985, Coke decided to introduce a sweeter version called the ‘New Coke’. Simultaneously, it decided to stop production of the older version. This change was carried out to take the sweeter Pepsi head on, which had steadily been eating into the market share of Coke. What is more, the blind tests carried out with the new version of coke revealed that the consumers preferred the sweeter taste. All in place for a perfect launch?

Not quite so. Just two and a half months after its launch, the New Coke production was stopped completely, and the traditional Coke was reintroduced.

So, what exactly went wrong? Indeed quite a lot. The proponents of Coke probably forgot that people who had Coke, associated it with a classic hard taste, and even though the sweeter taste might have been better, the classic taste is what made people come back to Coke again and again. Undoubtedly a case of flawed market research!

RJ Reynolds’ Smokeless Cigarettes

Already the proud owners of some famous brands like Camel and Winston, RJ Reynolds’ invested close to $325 million in developing a smokeless cigarette brand which it named ‘Premier’. This was done at the height of the anti-smoking campaign in 1988. The timing seemed to be just perfect. But then the product simply bombed. After 4 months of its launch, RJ Reynolds’ Premier was withdrawn from the markets. The reasons for its bombing were primarily attributed to a very obnoxious smell and odor.

By the mid-1990’s passive smoking concerns again began to crop up. RJ Reynolds’ spent another $125 million in researching an enhanced version of the smokeless cigarettes. A new product called Eclipse was launched in 1996. It claimed to have far lesser health risks. But again, history repeated itself, and the product never really took off. They blamed it on the health hazards related to the new cigarette which were uncovered after some time, but finer probing posed a very pertinent question. The smokeless cigarette appealed to the non-smokers, who don’t smoke anyways, and the people who actually smoke love the smoke from the cigarette, so where exactly did the market for this product exist?

Harley Davidson Perfume

Harley Davidson had a tremendous fan following. In fact so much so, that true Harley fans could go to the extent of getting Harley Davidson’s logo tattooed on their bodies! So, obviously Harley wanted to extend its brand and make full use of this fan following. Consequently, in the 1990’s it started foraying into other products like soaps, T- shirts, socks and even perfumes!

The outcome wasn’t very difficult to guess, the actual Harley fans were really agitated, while those who weren’t with Harley anyways would never buy a Harley Davidson Perfume, because there were so many better brands available. Harley had failed to realize that it was a masculine and rugged brand, and the idea of a perfume would obviously never fit into that image. Today, Harley Davidson is much more selective in its approach towards brand extension.

Modiluft Airlines

After deregulation in Indian markets, the scope for new entrants in a lot of sectors opened up. Thus was born Modiluft in 1994 as a collaboration between Indian industrial group Modi (who would operate the airline), and the German carrier Lufthansa (who would lease Boeing aircrafts). The combination was good and the timing was perfect, but still the airlines had to be grounded in 1996. This time the problem wasn’t from the customer side, rather there was a rift between the partners, one Indian and one German. Apparently their styles of business didn’t quite match. There were accusations of failure to honor the lease contract, put forth by Air UK Leasing Ltd (the aircraft leasing company), legal issues cropped up leading to strained relations between the original partners, the coordination completely broke down resulting in the inevitable. In 2005, Modiluft was reincarnated on a low cost model and operates successfully today as the second largest low cost carrier (in terms of market share) in India.

For Jokatimes

Guhan M

Mayank Jain

References

- Brand Failures – Matt Haig
- http://www.expressindia.com/

1. Natrajan Says:
   February 11th, 2009 at 8:42 am

   I don’t understand what marketing problem in ‘Modiluft’?

2. Ashis Says:
   February 11th, 2009 at 8:59 am

   Nice one !! good read ..

3. Manish Says:
   February 11th, 2009 at 4:37 pm

   CAMss wid Natti …. article is a good read but even i failed to understand the Modiluft thing !!!

4. Mayank Says:
   February 11th, 2009 at 10:16 pm

   Actually the case of Modiluft is a case of flawed market entry scheme, where they did not foresee the problems arising out of an Indo-German-UK association…..hence the bad marketing!
   Cheers!