2012 was a year filled with organizational, operational, and technological transformations across every retail tier, category, business model, and touch point. If 2011 had retailers scrambling to catch up with consumers, 2012 was defined by proactive and often controversial retail reinventions, many of which promise to gain traction this year.
With the New Year just underway, licensing companies still have a shining shot at getting into a new groove with retailers, but there’s a dirty secret that’s standing in the way of even some of the savviest brand marketers: they can’t figure out their own value. In fact, our retail positioning work this year confirms that sometimes it’s the companies with the most highly-developed marketing machines that have the hardest time figuring out what it all means to retailers.
Some licensors have a condition that I call “delusions of brandeur” – they’re such big brands and are so brand-centric that they haven’t thought about how their brands fit into retailers’ ever-expanding brand platforms. They expect retailers to make connections to their brands rather than taking responsibility for creating the alignments in the first place. In some cases, they assume that the killer direct-to-consumer marketing that they’ve already developed will be “plug and play” for retailers. At a time when most retailers have developed rock solid and highly-individualized brand identities, that is a super risky strategy.
Licensees, on the other hand, are very product-driven and for some, product innovations that are already in the pipeline dictate their strategy. The typical approach is: here’s the new product line, make it work, we can’t turn back, and please, no changes! From there, the process regresses into a “features and benefits” sales pitch to retailers that instantly commoditizes the proposition. Retailers can then easily decide to source the products themselves or find someone else who will. It goes without saying that your brand gets lost when those who represent it dumpster dive into price competitions and tactical conversations.
How to not blow your fresh start in 2013: Reinvent by repositioning
I love to watch the lights go on when companies see how they can drive extreme alignment simply by repositioning what they are already doing – leveraging their existing brand assets, services, products in the pipeline, and even existing marketing, in many cases, and shaping them into a fresh, simple, and retail-relevant message. In my experience, this is by far the most overlooked opportunity among licensors and licensees.
In fact, too many companies are creating new brands, acquiring other companies, creating new divisions, building new product lines, and hiring new people before they have relevantly positioned the assets they already own. Such approaches not only waste resources, they build shiny new additions on top of shaky foundations.
The following are a few of the opportunities you’ll realize, and pitfalls you’ll avoid, by making repositioning the cornerstone of reinvention.
1. You’ll unearth the value of assets that you’ve been taking for granted or even giving away, increasing profitability and conserving resources.
2. You’ll find that many of the bolt-on ideas that you’ve been considering will turn out to be redundant or ill-advised, allowing you to focus on and increase the value of existing assets.
3. You’ll integrate and align anything you decide to add on with your baseline positioning, bolstering your total value proposition and increasing credibility.
4. You won’t have to over-explain the choices that you’ve made – they’ll be natural extensions of your newly-relevant positioning, putting you in a power position as a partner.
Kick off 2013 with a vow to polish what you already have before chasing shiny new objects and you’ll be amazed by your retail results.
This article originally ran on the International Licensing Industry Merchandisers' Association (LIMA) website.