The Brand Avenger 2013 year in review.

I thought I would do something a little different for my 50th blog and provide a year in review for 2013. Over my last 49 articles The Brand Avenger has carefully dissected brand strategy, poor decision making and has scrutinised the controversial areas that have led to outrage from the public. However after spending so much time writing about the wrongdoings of many a brand I simply wouldn't be doing justice without providing a proper review. For the purposes of curiosity I would like to develop this further by providing a breakdown of the top ten brands who should be most worried, brands who don't need to worry despite some horrendous decision making and brands who might be in some danger so are ones to watch in 2014.

All is fine despite some poor decisions

Over the year we have seen just as many examples of poor branding decision-making from established brands as we have seen from smaller, independent companies. One of the first companies we covered for expenditure in celebrity endorsement as opposed to more measurable forms of marketing was Nike. We criticised Google for lack of clarity over data protection rules for email and was critical of Starbucks over tax evasion and lack of ethical practice. Whereas these were all valid concerns it is clear there are still some companies that have enough brand equity to not feel the impact too harshly from poor decision making. Within this 'safe' group I would place Channel 4, Adidas, Amazon, Microsoft, Facebook, Twitter and Coca-Cola on top of Starbucks, Nike and Google. Whether it is all measurable and worthwhile investment or not these companies are spending enough money to protect themselves from the poor decisions. Their sheer size and market strength protects them from feeling the repercussions of poor decisions making more so than the more vulnerable companies in the market. It of course doesn't justify poor decisions but does make it easier to protect against.

Ones to watch out for in 2014

If you have followed The Brand Avenger blogs in 2013 you may have noticed some big brands are missing from the above list. This is not to say these companies should worry about going out of existence anytime soon but it does mean that the following need great years in 2014 as they have a lot to prove to the market.

My first brand to watch is UK insurance comparison company Go Compare. The Brand Avenger covered this company in 2013 after it was revealed they had the most complaints for not one but two adverts to the ASA in the UK. Now one could argue the brand managed to turn negativity into smart and sensible strategy by evolving it's Go Compare advertising but they will have to be extra careful in 2014 to not evoke the same emotional reaction in the general public. It might be great every now and then to raise awareness but it won't be long before the company starts to really annoy customers and jeopardise sales. 

Staying in the UK Gregg's was responsible for some poor decision making in 2013 which wasn't helped by taxation and poor weather. Although still a prominent name on the UK high street Gregg's will need to ensure they stay on top of things this year and come up with new innovative ways to meet the needs of a public with changing tastes and perceptions of high calorie snacks.

The last two companies who need to have a strong and steady 2014 are Apple and M&S. 

M&S came under criticism for customer service following the Halal controversy of Christmas although this wasn't the least of the high street chains worries. Poor food sales and a competitive retail market has led to real challenges for the big UK name. They will need to get their head down in 2014 and focus on revival. HMV and Woolworth's are examples of what can happen if you continue to get brand positioning wrong or if you ignore changing trends in the market. 

Apple have been here before. The weight of expectation must sometimes be crippling however when you have a history of innovation this is the risk you take. It is clear from the early criticism we covered on Apple's innovation they need a big year strategically. The new CEO will be under pressure to deliver so we will certainly be watching this one closely.

The top ten worst brand impacts of 2013

And so all that is left to do is to cover the worst branding decisions of 2013.

10) Asda-Walmart: Stack it high, sell it cheap has long since been the motto for one of the biggest companies in the world. But what we began to see in 2013 was a breakdown in the belief that price is king. Asda-Walmart came under particular scrutiny regarding its treatment of staff. Adding this to a poor performance in the market and you really have to question how long the powerhouse can continue to support the notion that customer loyalty and retention is not as important as managing the bottom line.

http://brandavenger.blogspot.co.uk/2013/11/asda-wal-mart-having-had-much-to-be.html

9) Ryanair: In the Summer we released a blog with a somewhat provocative title claiming that although Ryaniar doesn't care about customers this works fine for their brand strategy. 

http://brandavenger.blogspot.co.uk/2013/06/ryanair-doesnt-care-about-customers-and.html

Now if you have recently viewed the Youtube clip of the dramatic 8 hour delay of the February 14th Ryanair flight from Stansted to Porto you might be inclined to believe that Ryanair doesn't care about customers at all. But for a long time now it is clear that Ryanair has managed to get away with a lack of customer service through positioning themselves as a market leader in low prices.

2013 Has already brought about a renewed emphasis on customer service from the Irish brand. If they want to ensure long-term success it will be crucial for them to continue this. However if they continue to get negative publicity from social media and scrutiny from regulatory bodies they might be putting themselves in real danger.

8) MySpace: I would see MySpace as a work in progress despite an unsure future prior to 2013.

http://brandavenger.blogspot.co.uk/2013/06/flogging-dead-horse-can-myspace-rise.html

Their might still be some life in the old horse yet if Justin Timberlake can work his magic and utilise his music connections. The repositioning of the brands to become more of a creative network for music artists appears to be bringing new life to the brand. However this type of repositioning is very hard to make scalable so it will be interesting to see how the powers at be can continue to grow the brand. I wouldn't expect it to reach the lofty heights it had done so before though.

7) Wonga: What a year for this UK short-term loan provider. On one hand you have a company that is making record profits and is in a clear period of growth. In the other you have a company which is scrutinised for exploiting the poor and high profile figures such as the Archbishop claiming to be coming after you.

http://brandavenger.blogspot.co.uk/2013/07/should-wonga-be-worried-about-its-brand.html

This is not so much a worry about the performance but more so about the context and conditions. Whether or not this will be sustainable will mostly come down to how well (or how poorly) Wonga manage its public perception. 

6) EA should find themselves very fortunate that they can be mentioned twice in Brand Avenger articles, can be nominated for worst company in the year two years running in the US and still be outside the top 5 of worst brand decisions.

http://brandavenger.blogspot.co.uk/2013/02/a-twenty-something-male-strolls-down.html

http://brandavenger.blogspot.co.uk/2013/04/is-ea-sports-worst-company-in-us-or.html

There is a reason for The Brand Avenger's decision to keep out of the top 5 and it is all down to the emotional reaction. EA impact on a large number of engaged and socially media active consumers and so I would argue it is easier for the company to face scrutiny than other brands. There are clearly poor strategic decisions that are being made but can we truly state that a company performing as financially strongly as EA is a company in danger of extinction?

5) Yahoo: Sales were on the rise in August but perception was suffering.

http://brandavenger.blogspot.co.uk/2013/08/is-yahoos-brand-reputation-on-rise-or.html

While it is clear Yahoo have made some massive strides in acquiring brands that will help stimulate long-term growth there are still questions that remain over the strength of the brand. Recent results show positive signs for the future especially when you consider mobile usage but when you consider customers are still turning away from utilising search engine functionality and Google continues to dominate the market you can't help but feel nervous for the big Y.

4) Abercrombie: A disaster year which has led to wide-scale criticism and the public demotion of key senior leaders. When the former CEO decided to chip in with his thoughts on who should be wearing Abercrombie he did more to damage the company in one sentence than many competitors have done by any other means in years.

http://brandavenger.blogspot.co.uk/2013/05/are-woes-of-abercrombie-fitch.html

I still don't see a revival for Abercrombie. All I can say is even if they don't believe in plus size shirts I hope they sell shoes above a certain size because it's going to take a larger than normal trainer to fit the big old foot in Abercrombie's mouth.

3) Groupon: We have seen positive signs under the new CEO however the company continues to struggle when it comes to its position in the market

http://brandavenger.blogspot.co.uk/2013/03/brands-behaving-bady.html

This is going to a big year for the discount voucher site. They need to get their mobile strategy right and understand the right deals to provide their customer base with a positive feeling for the discounter. Failure to do this could result in a nasty decline for a once promising start-up.

2) Billabong: In October we asked want went wrong with Billabong however maybe we should have asked what continues to go wrong for the clothing company?

http://brandavenger.blogspot.co.uk/2013/10/what-went-wrong-with-billabong.html

It's going to take a massive effort and a clear and concise brand recovery plan to save this Aussie export from extinction in the coming years. For a company that has has such a strong standing for so long you have to question where it all began to go so wrong.

1) Blackberry: And so finally we get to number one. The brand that has suffered more than any other this year following poor strategic decision making.

http://brandavenger.blogspot.co.uk/2013/08/kicking-habit-crack-berry-users-just.html

Blackberry had such a strong position and a clear advantage when it came to their association as the business phone of choice. But somewhere along the road as smartphones continued to rise in the market Blackberry has just lost itself along the way. 2014 s going to be a long hard year for the Canadian company. They need to come up with a strategy and come up with one fast. It isn't out of all possibility that by 2015 they could be completely out of the mobile market at this rate.

Who won Superbowl 2014?

It is that time of year again to once again assess the Superbowl and ask the pivotal question on everyone’s minds? Not why the Bronco’s never showed up to the game but was the investment from brands worth it?

http://adage.com/article/special-report-super-bowl/super-bowl-ad-chart-buying-super-bowl-2014/244024/

Some of the companies on the above list need to be held accountable for why they would decide to put so much money into a one-minute advertising spot. But then there are some examples of companies that have managed to utilize the Superbowl to their advantage whilst at the same time creating value.

There will be many different ways to look at the value. Some may determine that success meant an increase in page views, others may look for an increase in units sold or products/services purchased while others may want to determine how much buzz was generated around featured brands.

http://www.independent.co.uk/arts-entertainment/tv/super-bowl-2014-the-most-talked-about-super-bowl-commercials-9102961.html

As you can see from the above T-Mobile were successful in taking a hot topic with the more involved viewer of the Superbowl and tying to the message they were looking to communicate to support the growth of the brand. For this The Brand Avenger much give a lot of credit. Bud light was successful in creating an advert that gathered sufficient social media buzz across Facebook and other sites so they also deserve kudos.

The Brand Avenger would argue that all of the talk around value comes down to one simple and clear fact. To advertise during the Superbowl can cost a company anywhere in the region of $4 million so if you are going to invest that money you better be darn certain it’s going to do something to return for your brand. But what about those brands who still gather attention without having to spend a single dime on the special effects, celebrity endorsements and glitz and glamour that comes with above the line.

That is why for The Brand Avenger the clear winners for 2014 was JC Penney.

http://abcnews.go.com/Business/wireStory/best-super-bowl-ads-game-22362306

Controversy still remains over the use of mumbled tweets but the fact of the matter is JC has raised product awareness and attracted eyeballs to its product while not spending a single dime on the game. It’s a shame the same can’t be sais for some of the other brands who decided to put up millions of dollars for a flashy TV campaign.

Is Twitter dying or flying?

Is Twitter's recent fall in stock value anything to be seriously worried about for one of the largest social media companies in the world? It certainly isn't a small issue for a company or its investors when one fifth of stock value is lost following the publishing of results so what has led to such a stark fall in confidence over the latest period?

http://www.bbc.co.uk/news/business-26059710

Some believe Twitter is over valued, some believe the user growth is not in line with what it should be and some believe the lack of active users leads to little chance of long-term stability.  On top of all of this comparisons will no doubt continue to be made to Facebook. The fact that Twitter's main competitor has five times the amount of users builds into the perception that Facebook is the dominant player in social media. This creates an interesting dilemma for investors when deciding who to plug their hard earned cash into for a lucrative and growing portfolio.

http://www.foxbusiness.com/technology/2014/01/06/analyst-bet-on-facebook-and-google-over-twitter/

Incredibly 90% of Twitter growth can be attributed to advertising revenue so it will be more than a small shock to some that Twitter has yet to define a sensible algorithm to determine relevant customer tweets and relate this data back to a targeted audience. This is of course a significant part of Twitters issues as it means potential business is lost to competitors. If the average owner of a stock portfolio continues to place Twitter in the same bracket as Facebook there will only be one winner in that battle.

http://www.marketingmagazine.co.uk/article/1230188/twitters-value-drops-fifth-user-growth-stutters

We all shouldn't start to get too worried about Twitter in the long-term. The fact of the matter is the company continues to see an strong growth in users (30% compared to 2013) and there are a number of other unique competitive advantages over other social media competitors. The Brand Avenger believes the two most important factors to look is the ability for real-time and instantaneous content to be created and shared and the companies dominance of utilising second screen capability. One of the best videos I can find on the web today to bring this to life can be found at the below link and highlights how many people were tweeting on their second screen (laptop or smartphone) whilst enjoying the Superbowl on their main screen.

http://www.belfasttelegraph.co.uk/video-news/video-super-bowl-lights-up-twitter-29988548.html

We have set it before and we will say it again! The way companies choose to spend their advertising and marketing revenues will change as we move into the next decade. Twitter have a clear competitive advantage in the sense that the public are already using hash tags and Tweets to communicate their feelings about brands. Twitter has an opportunity to potentially use this power to offer a integrated media package to the market that creates an aligned marketing message across TV and social. Alternatively they could just choose to highlight and embrace the value of their own platform for advertising investment, a value of which cannot be denied when you consider examples like the ones mentioned below.

http://www.dailyherald.com/article/20140208/business/702089958/

Twitter is different to Facebook and it already has pole position in a number of critical areas that could help bolster future growth. It's now time for the little blue bird to spread its wings and fly into the next decade as the main destination for lucrative advertising expenditure.

Game over for Nintendo?

Nintendo announcing projected losses of $240 million is definitely not small fry so should we all be worried about the long-term stability of Mario and friends? This will be especially concerning since sales for gaming hardware has increased 28% mostly driven through the launch of new gaming systems from Sony and Microsoft.

http://www.washingtonpost.com/business/technology/nintendos-painful-quarter-spells-real-trouble-for-company/2014/01/17/de531dbe-7f88-11e3-93c1-0e888170b723_story.html

There might not be too many reasons to panic as of yet. Most people would argue that Nintendo has been the main company propping up the sales of the gaming industry since 2008.

http://www.zeldainformer.com/news/apparently-the-gaming-industrys-decline-is-nintendos-fault-360-to-outsell-w#.UuWdvyg4kb0

Could the recent drop in sales really be testament of how the gaming industry is structured more so than an indication that the company could be facing a worrying future? The big names in gaming all enjoy a piece of a pie when it comes to the launch of a new console. Nintendo have carved themselves a successful niche over the years by positioning their brand to appeal to families and groups of friends whilst Sony and Microsoft have aggressively gone after the solo gamer. However as gamers can of course have more than one console hence lining the pockets of more than one tech giant is the recent decline in sales to be expected considering the launches of the other consoles?

Whereas there is a lot to be said in regards to the impact other console launches would have had on Nintendo you would surely expect the analysts who work at the company to have considered this in their projections. However if this is the case why have they the number crunchers had to readjust forecasts? 

Nintendo need to take stock of the situation and react fast to keep up with the consumption habits of the customer and changing trends in the market. One way they may look to do this if through entering brave new worlds such as the smartphone market.

http://www.bloomberg.com/news/2014-01-19/nintendo-pressed-to-exit-hardware-after-wii-u-flop.html

Nintendo’s extensive library of characters could be utilized in exciting new ways through a number of hardware and software capabilities. Nintendo could actually be the first games company to take an innovative and important brave step towards addressing how the consumer of tomorrow will want to consume gaming. It’s not like Nintendo have no history of innovating in the sense of adversity. In short the threat could certainly become an opportunity to contrary to what the good folks at Bloomberg might suggest Nintendo shouldn’t make the move to utilizing smartphone technology whilst fully turning its back on consoles. The true companies who make a difference invest significantly in the future whilst maintaining presence in current markets. If Nintendo are going to see out this storm it will be as important for them to address the console challenge as it will be to be the first to fully shape the future of gaming.

Is China worth it for L'Oreal?

L’Oreal aren’t the first and won’t be the last of the big companies who have had their hands burnt trying to enter the Chinese market through using their marque brands from Western markets. When thinking of China the concept sounds like a great one at face value. A thriving market and prospering economy that continues to grow has resulted in an increase of consumers with significant disposable income. With this in mind why wouldn’t companies who sell high margin, luxury items like L’Oreal not want to exploit the market and grow their brands? However the reality is that the target market just aint buying it

http://www.scmp.com/business/companies/article/1404118/loreal-brand-and-revlon-call-time-china

There are a number of theories as to why companies like L’Oreal might be struggling in new markets. The Brand Avenger would argue one of the key reasons L’Oreal has struggled is the assumption that one single universal brand approach is strong enough to stretch across all markets in both the West and the East. This assumption is a problem that more and more companies will begin to experience as they become more global.  In essence L’Oreal’s decision to target Garnier products in the market with no differentiated approach is either naïve or lazy. It is for that reason L’Oreal this week deserves to be critiqued by the ever-watching eye of The Brand Avenger.

http://www.marketingmagazine.co.uk/article/1226943/why-china-losing-its-lip-gloss-western-brands

Of course its not all doom and gloom for L’Oreal and they certainly are far from taking the decision to entirely remove themselves from expanding into the Far East. Through acquiring local companies in the Chinese market L’Oreal are demonstrating that they understand the mistakes in their previous strategic approach and are preparing themselves to do something about it.

http://articles.economictimes.indiatimes.com/2014-01-14/news/46186240_1_l-oreal-skincare-hong-kong-listed

As the market becomes more and more saturated with imported foreign brands localization will become the key as opposed to globalization.  Put simply companies like L’Oreal will have to work harder to understand the new segments of customers they are exposed to. Through investing in the right infrastructure, researching the market thoroughly and adapting the product offering to meet the needs of the base, investing in the Chinese market might just still be worth it yet for the French facial experts.