October 11, 2012
Consensus Advisors: Fields of Endeavor – Laura Ashley, Apple and the NFL
Through a special arrangement, presented here for discussion is a summary of a current article from Consensus Advisors, a boutique investment and advisory firm specializing in the retail industry.
There are some brands that are hard to kill, even if you try. I know, because I once worked for a well-regarded brand which had this odd sort of death wish, and the recent follies involving the National Football League and Apple got me thinking about that.
In the 1980s and early 90s American women flocked to Laura Ashley stores here and abroad to buy their dresses and home furnishings.
I worked at Laura Ashley in the early 90s, and, while Laura Ashley excelled at design, it turns out that English romanticism and countryside aesthetics do not translate to effective supply chain management. New seasons were frequently launched with woefully late inventory arrivals, or without any inventory at all. In addition, hems and other finish work came undone with infuriating frequency. And yet, women kept on buying and, even with the shortcomings, stayed loyal to the brand.
But even slavish, irrational loyalty can be fleeting. Fashion trends ultimately changed, and Laura Ashley, anchored as it was in the English countryside sometime between the wars, didn’t. The stores are now closed, and the company lives on only as a romantic licensing enterprise here in the U.S.
Leaving the fields of Eton for the gridiron, we come to the NFL, a multi-billion dollar business with a following second to none in the U.S. and, increasingly, abroad. Then they decided to lock out the referees.
For a league which prides itself for putting a first class product on the field, the use of replacement referees frustrated players, coaches and fans and made the league a laughingstock. Being forced to close a deal with the referees union with more urgency, the NFL hopes to get past the late night television jokes and continue to groom its brand for world domination. After further review, that call is confirmed as the best one of the season.
If Apple could throw a challenge flag on its recent iPhone 5 launch, it probably would. Despite selling five million units in short order, an uncharacteristic snafu arrived with the new phone. Specifically, dropping Google Maps for Apple’s own mapping app has left early adopters with maps that don’t necessarily correspond with the situation on the ground.
Users have flocked to social media to complain and make fun of the app’s glitches, which included judging landscape features by their names. For instance, the Madison Square Garden arena in New York shows up as green park space because it is a "Garden.’ Now, that is funny.
Tom Cook, Apple’s CEO, posted an online apology to customers regarding Apple’s own substandard maps software, and directing customers to use other company’s map apps. That is quite a comedown for a company which is almost 50 percent more valuable than the next largest.
While we can’t help but laugh about skirt hems dropping out, referees doing a poor impression of the Three Stooges and maps that have misplaced Stratford-upon-Avon (Sorry Mr. Shakespeare), one must guard against becoming a joke. Today’s joke becomes tomorrow’s also-ran. Companies must be on constant guard against anything that undercuts their message and their brand. Think about that the next time you see Laura Ashley paint at your local home improvement store.
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Discussion Questions
How forgiving are consumers to even the most revered brands? Did Apple’s map problems hurt its standing with its fans at all?
Poll
Even the best brands sometimes stub their toes. The key is how to respond to the problem. If they continually make mistakes, consumers will not be so forgiving. If the mistake is a one time event, and the brand responds appropriately, consumers tend to forgive and forget.
The NFL and Apple will recover. In a few weeks fans will be complaining about the professional refs’ calls, and with a few fixes, complaints about Apple maps will recede.
Consumers have short memories where major brands are concerned. Apple’s map problems are a new hurdle for the company this minute, but no one will remember once the problems are fixed.
The degree to which brand loyal consumers tolerate miscues and mistakes is amazing. Apple and the NFL are great recent examples. The inertia amongst these brand loyal folks seem to allow these select brands to get away with abuses that would dispatch lesser brands at the blink of an eye. However, in the new transparent digital world where the voice of consumers can be heard globally in nanoseconds via social media, brands are less immune to inertia.
The recent foible with the NFL replacement referees galvanized by the Monday Night Football between the Green Bay Packers and Seattle Seahawks, forced both sides of the bargaining table to resolve their dispute in order to protect the NFL brand from further tarnishing. (My opinion is of course compounded by the fact that I happen to be from Wisconsin and a Packer fan!).
As a recent ‘convert’ to the Apple community, I am confounded by what Apple users tolerate and the insulated ‘attitude’ that I continually experience during my ‘OnetoOne’ sessions I participate in while trying to run my business in an Apple computing world. As Apple plies its way into corporate America, they will need to address this brand ‘culture’ in order to succeed. American business will not compromise and change their expectations just to comply with the Apple ‘brand’. The ‘map’ incident will be just the tip of the iceberg as digital transparency will enlighten these issues to a much broader audience.
Apple’s problems are a flash in the pan for them. And they took quick corrective action, so for most people it’s not an issue at all. Most good brands do fine with being lampooned once or twice for screw-up if they fix the problem quickly and keep on providing good products/services.
The Apple situation boggles the mind. Where is the quality control/testing as part of the product development cycle? Don’t they have people in the field testing their features/functionality? I disagree that it has little effect. It creates a lack of confidence in what they are putting out. What’s next — the phone doesn’t work? Oh yeah, who bothers to use the dialer anymore.
For the NFL, billionaires negotiating with part-time, yet full-time responsible employees was just as laughable. The true hypocrisy was having a stance to protect players health with new rules/regulations and then putting high school referees on the field with professionals moving at 2x the speed than they are used to. Dangerous? Yes. Irresponsible? Yes. Goodell may lose his job over that entire series of decisions let alone the ongoing Saints bounty fiasco that continues to get news vs. finally resolving itself.
Does the consumer have a short-term memory for missteps? Yes. But these episodes do erode brand equity and confidence. As a Chicago Bear fan, I’m not crying about the call in the Seattle game. Neither is the Canadian pool winner that got $700k because Seattle was his pick over the Packers to win and didn’t share the pot with 5 others he was tied with going into the game!
The NFL doesn’t have to worry about fans, congress has given them an exemption to monopolistic behavior laws that allows them to demand whatever they want from broadcasters. If you’re the only game in town, it is easy to maintain your brand.
Brand power is a fickle thing, as these examples make clear, but it may also be resilient. When a brand owner screws up, damage to equity ensues. This may be a minor, temporary effect, or a costly, enduring one.
The NFL seems to have sailed past the Ref Replacements episode with minor consequence, beyond a slight weakening of contract negotiating leverage. Apple may have allowed a glimpse of a core weakness afflicting it in the post-Jobs era. Laura Ashley was simply a style of its era whose lifecycle was shortened further by sloppy execution.
The key take-away for me is how few consumer opinions are likely to change as a consequence of a single brand blunder. Apple folk may not be loyal to the brand, but they are fierce defenders of their point of view, even in the face of a confounding experience. Non-Apple users may be just as convinced that their preferences are superior and they will regard a small failure as proof.
This reminds me of another class of brand custodians, political strategists, who seem to live with this reality every day. Today’s candidate gaffe may be tonight’s talk show joke or the deciding factor for swing voters. But 94% of Americans already have their minds made up, one way or the other, and the error and the reporting of the error will do little to change their minds.
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Even the best brands sometimes stub their toes. The key is how to respond to the problem. If they continually make mistakes, consumers will not be so forgiving. If the mistake is a one time event, and the brand responds appropriately, consumers tend to forgive and forget.
The NFL and Apple will recover. In a few weeks fans will be complaining about the professional refs’ calls, and with a few fixes, complaints about Apple maps will recede.
Consumers have short memories where major brands are concerned. Apple’s map problems are a new hurdle for the company this minute, but no one will remember once the problems are fixed.
The degree to which brand loyal consumers tolerate miscues and mistakes is amazing. Apple and the NFL are great recent examples. The inertia amongst these brand loyal folks seem to allow these select brands to get away with abuses that would dispatch lesser brands at the blink of an eye. However, in the new transparent digital world where the voice of consumers can be heard globally in nanoseconds via social media, brands are less immune to inertia.
The recent foible with the NFL replacement referees galvanized by the Monday Night Football between the Green Bay Packers and Seattle Seahawks, forced both sides of the bargaining table to resolve their dispute in order to protect the NFL brand from further tarnishing. (My opinion is of course compounded by the fact that I happen to be from Wisconsin and a Packer fan!).
As a recent ‘convert’ to the Apple community, I am confounded by what Apple users tolerate and the insulated ‘attitude’ that I continually experience during my ‘OnetoOne’ sessions I participate in while trying to run my business in an Apple computing world. As Apple plies its way into corporate America, they will need to address this brand ‘culture’ in order to succeed. American business will not compromise and change their expectations just to comply with the Apple ‘brand’. The ‘map’ incident will be just the tip of the iceberg as digital transparency will enlighten these issues to a much broader audience.
Apple’s problems are a flash in the pan for them. And they took quick corrective action, so for most people it’s not an issue at all. Most good brands do fine with being lampooned once or twice for screw-up if they fix the problem quickly and keep on providing good products/services.
The Apple situation boggles the mind. Where is the quality control/testing as part of the product development cycle? Don’t they have people in the field testing their features/functionality? I disagree that it has little effect. It creates a lack of confidence in what they are putting out. What’s next — the phone doesn’t work? Oh yeah, who bothers to use the dialer anymore.
For the NFL, billionaires negotiating with part-time, yet full-time responsible employees was just as laughable. The true hypocrisy was having a stance to protect players health with new rules/regulations and then putting high school referees on the field with professionals moving at 2x the speed than they are used to. Dangerous? Yes. Irresponsible? Yes. Goodell may lose his job over that entire series of decisions let alone the ongoing Saints bounty fiasco that continues to get news vs. finally resolving itself.
Does the consumer have a short-term memory for missteps? Yes. But these episodes do erode brand equity and confidence. As a Chicago Bear fan, I’m not crying about the call in the Seattle game. Neither is the Canadian pool winner that got $700k because Seattle was his pick over the Packers to win and didn’t share the pot with 5 others he was tied with going into the game!
The NFL doesn’t have to worry about fans, congress has given them an exemption to monopolistic behavior laws that allows them to demand whatever they want from broadcasters. If you’re the only game in town, it is easy to maintain your brand.
Brand power is a fickle thing, as these examples make clear, but it may also be resilient. When a brand owner screws up, damage to equity ensues. This may be a minor, temporary effect, or a costly, enduring one.
The NFL seems to have sailed past the Ref Replacements episode with minor consequence, beyond a slight weakening of contract negotiating leverage. Apple may have allowed a glimpse of a core weakness afflicting it in the post-Jobs era. Laura Ashley was simply a style of its era whose lifecycle was shortened further by sloppy execution.
The key take-away for me is how few consumer opinions are likely to change as a consequence of a single brand blunder. Apple folk may not be loyal to the brand, but they are fierce defenders of their point of view, even in the face of a confounding experience. Non-Apple users may be just as convinced that their preferences are superior and they will regard a small failure as proof.
This reminds me of another class of brand custodians, political strategists, who seem to live with this reality every day. Today’s candidate gaffe may be tonight’s talk show joke or the deciding factor for swing voters. But 94% of Americans already have their minds made up, one way or the other, and the error and the reporting of the error will do little to change their minds.