FastCompany’s recent story “The Biggest Business Comebacks of the Past 20 Years” shared the stories of brands and companies that had returned from the brink to greater success than ever. From Lego to Old Spice, from Netflix to Bacon (yes, bacon), the examples told just the kind of stories we love to think about at IMC: how brands are created, euthanized, and (sometimes) revived, and how new strategies, new partnerships, and new distribution channels makes reinvention possible.
As I read the article, I realized that it also told a strategic story. There seemed to be three different methods these companies and brands had used to come back from the brink.
- Get a New Business Model
Almost a third of the comeback stories used their challenges to reinvent something big about their business. It isn’t easy to risk your business on a new channel of distribution or business model, or on a marketing message unlike any of your peers, but sometimes it’s the only way to survive. A few examples:
- Netflix switched from a mail-order to a digital subscription service, then began producing its own content. That means listening to what customers want even if it isn’t what you’ve built.
- Converse transformed itself from sporting goods to fashion company. That meant creating all-new relationships (with retailers, designers, even customers), but it also opened up a new space where it could be unique.
- Old Spice turned a grandfatherly brand into a millennial favorite with something no other deodorant was willing to use: humor. Sometimes zagging (when everyone else is zigging) is the only way to survive.
- Focus – with the Right New Leader
Another set of companies had grown weak by trying to be too many things to too many people. Turning themselves around meant making one big bet and turning it over to the right leader.
- The New England Patriots under Robert Kraft focused on getting a new stadium that could support growth, then invested in two very focused underdogs: Bill Belicheck and Tom Brady. The rest is (Super Bowl) history.
- Lacoste, like other fashion brands, spread itself too thin through a long list of downmarket products. Its turnaround meant hiring a high-fashion creative director and opening its own stylish boutiques. With focus, the first fashionable sports brand came back to life.
- Disney Animation lost its focus in the early 2000s with watered-down duds. It hired new, focused leadership by acquiring Pixar, whose leaders rebuilt the home of Mickey Mouse with skills that had first learned . . . at (or from) Disney.
- Sometimes it Take Death – or at least Bankruptcy – to Revive
The third group includes companies that were so broken that they actually had to die – usually via bankruptcy – before they could be revived. Bankruptcy not only allowed them to cancel bad contracts but also forced them to think differently – the hardest thing to do with a long-established brand.
- General Motors and Delta both used bankruptcy not just to rewrite their balance sheets but also to force discipline on bloated businesses. GM killed three major auto brands along the way, and Delta found a model that allowed it to thrive in a marketplace of harsh competition and mergers.
- Marvel couldn’t get its head out of its comic book past; bankruptcy allowed it to start over as a film production company, where its wide range of superheroes could succeed.
- Lower Manhattan. 9/11 effectively bankrupted New York’s efforts to prop up its financial district after much of finance had left it for midtown. But just as Hurricane Katrina gave New Orleans a chance to reboot, the tragedies of September 2001 gave Lower Manhattan a chance to restart as a neighborhood for families, creative types, and tourists.
You’d never wish bankruptcy (much less a terrorist attack) on anyone, but sometimes it’s the only way to get people to focus on what works – or could work – when they can’t see it in any other way.
Companies shouldn’t have to die – or almost die – to generate the changes they need to survive. But the financial and emotional investment in the past is hard to reject, and it’s only when they have nothing to lose that most managers will actually do the right, new thing.
Which of these strategies could you apply to your own brand challenges – before it’s too late?