By Mark Artus, CEO
Zombie brands are simply those that have failed to demonstrate their currency to consumers, and the new digital economy is only going to make the challenge more pressing, argues Mark Artus
The late Rodney Fitch, a huge champion of design, believed that shopping was the purpose of life and that design should help to enrich everyone’s shopping experience. He was certainly right from my perspective, but over the last few years the tectonic retail plates have shifted and will continue to reverberate for some time. Simply put, we are now living in a new digital world, and this has fundamentally changed the way we now want to shop. The good news is that innovation feeds on disruption, so we are at a seminal point in the evolution of the retail experience… but will it be for the better?
Each day we head through life surrounded by businesses and their brands. However, recent estimates predict around 100,000 zombie companies and brands operate worldwide. Zombie brands are those which have lost their purpose or meaning to us, brands such as Kodak, Mothercare, Warburtons. These brands are on life-support, their sales are probably ﬂat lining and they aren’t generating the proﬁtability required to grow.
There will be many internal reasons for this that cannot be seen, but there is one that is very clear: these companies have lost their relevance to us, and have failed to ensure that their brands are meaningfully different in a competitive marketplace.
These companies had the intellect and capability to build their brands in the ﬁrst place, so what happened? Why did things start going wrong?
In my opinion, the tectonic plate shift that has occurred has fundamentally changed the rules of retailing and branding, so boardrooms needed to adapt accordingly, but many have struggled with this.
Take the grocery business. It is hard to imagine that they are still following the basic rules invented in France over 40 years ago, and yet whilst customers’ shopping habits have been changing for some time, some retailers still expect shoppers to trudge around the aisles that are suited far more to store efﬁciency than they are to the shopper journey. And this is wherein the problem lies.
Massive super stores have built amazingly complex systems over this time to ensure that we get the very best when we need it 24-7. The algorithms to achieve this kind of distribution must be mind blowing and require these big companies to build ever more complex procedures and silos, but these juggernauts mean that it is hard for these procedures to change as fast as consumer preferences. We do like the freshness, the convenience, the quality, the variety, but did we mention that we also really like the experience? The ‘big shop’ is declining, but that isn’t just down to lifestyle factors; it’s also because the ‘big shop’ is a rather boring affair. Talk to anyone about some of the big players and they will tell you that something has been lost, that the drive for efﬁciency has adversely impacted on the personality and the emotion of the experience. The line “every little helps’ had a real purpose once upon a time, but we all now wonder who is being helped – us or the shareholders.
It doesn’t have to be this way. Retailers such as John Lewis, Waitrose and Next have demonstrated that engaging customers in this brave new world is achievable – it just takes courage and innovation, looking at the world through the eyes of their customers and giving them what they want – whether that’s same-day delivery or consistent, unbeatable quality. Brands such as Dove, Virgin, Apple and Land Rover, meanwhile, continue to build customer loyalty with products that resonate with consumers; that engage and excite us – functionally, intellectually and emotionally. So how do these companies do it? It’s simple, really – although not simple to achieve by any means. They do it by having brands that are relevant and meaningful; by having conﬁdence in business models that don’t depend on discounting to attract customers; and by building (and nurturing) long term relationships with consumers.
Today we have the perfect storm: a struggling economy, city pressure with its demand for short-term results, and a fundamental shift in our shopping habits. But out of crisis comes opportunity, and this is deﬁnitely the case in retail. Those who can work out how to appeal to us at an emotional level, who can make us feel good about ourselves as we shop, and who turn a necessary chore into a pleasurable experience (whether online or in-store) are surely the companies who will continue to be relevant for years to come.