Indeed, branding, like any business endeavour, can pose risks. However, it's important to highlight upfront that strategic steps and measured execution can significantly dampen these risks.
Small vs. Large Companies: Who's at Risk?
Smaller companies, being more flexible, can swiftly change direction if they encounter issues. On the other hand, large, widely recognized companies can face significant adverse effects from branding missteps that can damage public perception and cause considerable revenue losses.
A Case Study: Tropicana's Rebranding Misfire
A good example is the Tropicana fiasco in 2009. Their daring decision to entirely revamp their orange juice packaging resulted in a staggering 20% plummet in sales in merely two months, leading to a massive $30 million loss.
The underlying blunder? The new package design was a drastic departure from their familiar and trusted look. As a result, devoted customers failed to recognize the product on store shelves.
So, could Tropicana have sidestepped this catastrophe? Possibly. A strong marketing campaign may have softened the blow, but it seems a more cautious, gradual approach would have hit the mark. Introducing smaller, incremental changes over a longer timeframe would have been gentler on customers, allowing them to adjust to the new look without feeling alienated.
The Bottom Line
Strategic planning and careful execution are key in branding. By navigating potential pitfalls intelligently, businesses can manage branding risks effectively and enjoy a smoother journey in the marketplace.