ZIBS Blog

These days we are seeing quite a lot of co-branding in the ice cream isle. Tie-ins with innumerous candy bars (Godiva, Snickers, Twix, M&Ms etc), SpongeBob, Squarepants, Care Bear, and Disney’s Alladin have all graced the shelves.

However, what is of interest regarding brand essence is found in the superpremium ice cream category. This category is dominated by two brands: Ben & Jerry’s and Häagen Das.

Nestle and Unilever are going at it in the $32.4 billion ice cream market. Nestle merged with Dreyers in 2003 to create an ice cream empire which includes Dreyers, Edys, Starbucks ice cream, Nestle, and Dole fruit and Häagen Das. Dreyers had purchased Häagen Das from General Mills in 2004.

Unilever which owns Good Humor, Klondike and Beyer purchased Ben & Jerry’s in August 2000 for $326 million. Overall, Unilever has 2000 brands of ice cream and the category accounts for about 10% of its revenues.

Unilever thought it was doing a good thing purchasing Ben & Jerry’s. However, one thing it seems to have overlooked is the impact of brand essence. Brand essence represents the core values of the brand, and for the pre-acquisition Ben & Jerry’s this brand essence was quite strong. Ben & Jerry’s was run by two quirky guys that loved ice cream and also had a strong interest in social responsibility. The firm was well known for its environmental advocacy and social conscious sourcing from its headquarters in Vermont. It was seen through the eyes of the consumer as counter-culture and idealistic.

Häagen Das, on the other hand, was known to be simply a high-indulgence ice cream without any of these social responsibility values.

What happens when a massive global corporation purchases a “mom & pop” type of brand? The brand essence suffers from incongruity. As you can see from the chart Ben & Jerry’s is sliding in market share in comparison with Häagen Das, so this brand essence contradiction could be an underlying factor in the brands market performance.

A similar issue happened with Beatrice. Beatrice, a food giant in the 1980’s, found that utilizing a corporate brand often was counter productive, especially on craftsman type of products where the corporate identify was would smother that of the child brand. For small dairy farms the corporate brand’s positive elements would be offset by its negative elements. Beatrice found this all out the hard way and has since vanished.

Acquirers in the M&A world would best learn from these experiences and be sure to measure brand essence to uncover divergent elements in the target brand which would wipeout other potential synergies.

Sources:
Nestle Investor Seminar June 2004, Presentation
Mintel Ice Cream Report June 2005

Posted by Greg Thomas at 03:26 PM | Permalink | TrackBacks (0)

Nike and Apple have teamed up to be your ultimate running buddy. A variety of new Nike running shoes are available in stores (or lately to be in stores) that come with a small cavity in the foot bed in which to place a transmitter. The transmitter, made exclusively for your iPod nano, is available in Apple stores, online or brick-&-mortar. The transmitter relays the distance traveled and “talks” to the iPod so that when you’re gasping for air and about to run into that Krispy Kreme for a little respite and reprieve you are gently reminded that you have only 1.2 miles to go. This is where the ability to kick it up a notch by playing your “power song” will propel you to steer clear of the donuts and stay on track until the finish. Further garnering the power of stick-to-itiveness is the tracking capabilities you can monitor on your iMac before and after your run.

The innovative part of this new product/service, aside from the actual cool-factor the iPod and Nike brands bring to the table, is the user interface Nike runs on nike.com to complement the product/service. The extension of the experience with the brands may be the key factor to making this product stick with customers. The key differentiation for this UI is the attention to design. It’s intuitive and easy to understand and interpret. Both the aesthetic and functionality make you want to get up off the couch, pull on those Nike shoes, strap on your iPod nano and run like the wind, just to see it working!

The real innovation here is the continuation of the Nike brand and iPod brand using a synergistic approach to building a brand experience. The value derived from the experience for the runner is enabled to be an emotional one; thus, a bond is created. And then to further develop that bond (or nurture that customer relationship) Nike built an engaging community encouraging ongoing interaction, input, creativity, and, ultimately, (and here’s the key, branding folk) a relationship.

We’ll have to wait and see if it success ensues. From a brand angle it sure seems like it will be off and running in no time flat.

Posted by Dana Page at 12:52 PM | Permalink | TrackBacks (0)

How to get [business] people all riled up.

Talk about the following: Innovation, Branding, and Design.

Of course you don’t ever have to actually suggest a plan of action for making those key ideas and buzz words a part of your corporate culture or business strategy, but rather just sprinkle them in. A lot of people have been doing a lot of sprinkling these days. Talk, talk, talk. Very little action. We’ve seen what these “in” ideas and words can create in the case of P&G or IKEA or Target or Apple [And the list goes on] but really, how do these exemplary businesses turn a couple of big ideas and words into an action and an executable strategy that can sustain? How does a brand successfully leverage design to create innovation manifesting itself into a cutting-edge, desired, and obsessed-over brand?

Look no further than Mr. Nussbuam’s new magazine venture, INside Innovation. This magazine will “teach managers how innovation really gets done”. [Check it out for yourself: it goes live tomorrow night, June 8, 2006.]

What a great concept. You know Bruce Nussbuam as the BusinessWeek authority and guru on all things business, design, and innovation. Giving structure to what the majority sees as obvious and yet ambiguous is a behemoth task. But kudos to Mr. Nussbuam for taking on the challenge, for his expertise and the knowledge to surround himself with folks of the same caliber should prove inspiring and intriguing and will surely incite much debate. And, oh, how I love a good debate!

Speaking of which…

How to get [design] people all riled up.

Undermine their role by holding a contest rather than a client review from an employed design team/firm. Check out DesignObserver’s blog for the latest debate on this one. [Make sure you’ve got some time to read. You’ve been warned.]

Posted by Dana Page at 02:22 PM | Permalink | TrackBacks (0)