For years I’ve been a high priest of brand renovation, battling against the self-fulfilling effect of the so-called “brand life-cycle”.
For far too long BCG has made life-cycle theory fashionable through their “Boston Box” matrix, as a result of which far too many brands with potentially healthy and profitable futures have been consigned first to the unsupported “Cash Cows” box, before being consigned to the “Dogs” box, then to be withdrawn from the market altogether. What a terrible waste of potential shareholder value.
One of the most astonishing renovation stories is Skoda cars. Bought by VW, they were transformed from joke to cult status, from death-trap to top-of-class. Why does a Skoda have a double rear-window heater? To make sure your hands stay warm when you’re pushing it. That’s how it used to be.
In Communist Czechoslovakia, Skoda had some 98% of the local market, but customers had to put up with extremes of unreliability and poor performance. A clue to the low quality of the product is that one third of the workforce was drafted in from the local prison on a daily basis.
VW decided to invest heavily in product development and manufacture, but perhaps most importantly, they worked hard to create a totally different culture, initially bringing in experienced VW managers from other countries to work alongside their Czech colleagues. They built new relationships with key suppliers. There were no more convicts on the assembly line.
Quite quickly product quality improved and, with the introduction of new models and some honest marketing programmes, their reputation started to rise and sales in tandem. In fact, within a few years, in Britain they became the marque with the highest repeat purchase – an amazing 82% of owners going back for more. The Daily Mirror described the whole thing as “history’s greatest comeback since Bobby Ewing stepped out of the shower.”
Have you been involved in successfully renovating a brand that otherwise might have been consigned to history?
For far too long BCG has made life-cycle theory fashionable through their “Boston Box” matrix, as a result of which far too many brands with potentially healthy and profitable futures have been consigned first to the unsupported “Cash Cows” box, before being consigned to the “Dogs” box, then to be withdrawn from the market altogether. What a terrible waste of potential shareholder value.
One of the most astonishing renovation stories is Skoda cars. Bought by VW, they were transformed from joke to cult status, from death-trap to top-of-class. Why does a Skoda have a double rear-window heater? To make sure your hands stay warm when you’re pushing it. That’s how it used to be.
In Communist Czechoslovakia, Skoda had some 98% of the local market, but customers had to put up with extremes of unreliability and poor performance. A clue to the low quality of the product is that one third of the workforce was drafted in from the local prison on a daily basis.
VW decided to invest heavily in product development and manufacture, but perhaps most importantly, they worked hard to create a totally different culture, initially bringing in experienced VW managers from other countries to work alongside their Czech colleagues. They built new relationships with key suppliers. There were no more convicts on the assembly line.
Quite quickly product quality improved and, with the introduction of new models and some honest marketing programmes, their reputation started to rise and sales in tandem. In fact, within a few years, in Britain they became the marque with the highest repeat purchase – an amazing 82% of owners going back for more. The Daily Mirror described the whole thing as “history’s greatest comeback since Bobby Ewing stepped out of the shower.”
Have you been involved in successfully renovating a brand that otherwise might have been consigned to history?
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