Many retailers go through an exhaustive brand revitalization process only to find that they must do it again within two to five years. Even immediately after revitalization, they often have a vague sense of "something" not being quite right. They're still losing market share and not making customer connections. When they find that profits and sales start dropping, they have no choice but to go back to the drawing board. Why? The revitalization was probably superficial—design changes, marketing changes, but no real fundamental change. In reality, their retail brand has lost its relevance. There is no reason to believe. The customer doesn't believe, the employees don't believe and management doesn't know what to believe. Identifying the problem is one thing, but, how to fix it?
The goal should be to get it right the first time. Those retailers that are successful at revitalization begin by uncovering the real reason to believe in their brand. This ultimately results in successfully making believers of their customers and employees. The successful retailer is able to adjust to changing market conditions without going back to the drawing board. The brand's dramatic difference does not change with market fluctuations. The dramatic difference creates and sustains the long-term brand loyalty. The key: Nail it the first time around.
When a retail brand has lost its "reason for being," it is often because the company's perception of the brand differs significantly from the customer's perception. This is usually most apparent in differentiation. This "gap" in brand perception makes it incumbent upon the retailer to undergo a fundamental revitalization. The goal: to uncover that unique and compelling new brand identity, the "Reason to Believe"; then, live it and convey it in a consistent manner across all employee and customer touch points. This is what will ultimately change perceptions.
Brand perception problems need to be followed right to the root of the problem. A revitalization of any retail brand, to be effective, must go to the heart of the operation. Retail brand revitalization requires extensive in-depth analysis, research and objectivity. Every retailer that will survive in the experience-based economy will have a unique proposition…a reason for being. Research will bring it to light. Rebranding and repositioning the entire operation with a compelling new identity will breathe new life into the organization and reaffirm its reason for being. If executed properly through all channels, the new retail brand positioning will resonate with management, suppliers, employees and customers alike.
The goals of successful revitalization are as follows:
- Execution of business strategies into a compelling brand identity
- Integration of brand communications across all channels
- Integration of internal/external branding programs to increase employee commitment and customer loyalty
- Delivery of emotionally connecting and relevant brand experiences for the customer
Internal Branding: An Essential Component
The new brand identity must have "buy in" from employees, and employee training must be implemented to instill a clear-cut understanding of new directives and goals if it is to be successfully implemented. Aligning the employees and getting them on board with the corporate brand is the first order of business.
In a recent National Retail Federation survey, both Nordstrom and REI were listed as top retailers for customer service. Since both Nordstrom and REI were also at the top of the list in Fortune magazine's "Best Companies to Work For," this is not a coincidence. Successful companies understand that a crucial element of connecting the customer to the brand is accomplished through motivated employees who themselves understand and "buy into" the retail brand identity. Every employee, front line or not, should be viewed as a retail "brand evangelist."
Nordstrom encourages its employees to act as if "it's your name on the door." In turn, employees are empowered to make decisions that might improve customer service. Starbucks' "baristas" are treated as true "partners" in the company. They are given hours and hours of in-store training and a personalized, "Total Pay" package including compensation, stock, benefits and savings. A recent company survey indicated that people like to work for Starbucks because they like "to work in a place where I feel I have value." REI employees call their brand "A way of life" and encourage outdoor activity for their employees to achieve a work/life balance, provide gear discounts, free gear rental, and gear grants for personal outdoor challenges.
Clearly, if employees fully embrace a revitalized brand identity, experience it, and believe in it, they will effectively convey it to the customer. Clearly, retailers like Nordstrom and Starbucks have given their employees and the customer Reason to Believe.
Collaboratively, retailers and their brand consultancies can define those unique attributes of the brand that has real meaning to both the employees and the customer. These attributes, or "pillars" of the brand, are those elements that describe the unique qualities of the brand. These elements, communicated across every channel within the retail operation, have the ability to connect with employees and customers on a personal, emotional level.
Once defined, these attributes need to be embodied and embedded throughout all levels of the company. From the CEO down through the retail ranks, from product mix to advertising, in-store communications, signage and POP displays, one overall identity and message must resonate. Caveat: if the CEO of the company doesn't embrace the brand, live it and make it a focus of the entire organization, all of the revitalization efforts in the world will fall flat. Employees who become brand evangelists are one of the most powerful tools in the retailer's arsenal. Furthermore, the retailer's employees can, in turn, make evangelists of the customers by embodying the brand well and by making their customer service second to none.
REI: A Case Study
Once the brand identity has been defined and embraced, it can be incorporated throughout all retail touch points. The new identity gives employees, suppliers and customers an authentic Reason to Believe. The "reason" is real and accepted. Therefore, the perception will be real, accepted and effective.
REI is a brand revitalization success story. A short time ago, the 70-year-old outdoor retailer, based in the Pacific Northwest, had very loyal but aging customers. They identified the problem: the operation failed to connect with younger generations of customers. It was very important to REI to remain true to its heritage, while revitalizing its brand for a more contemporary audience.
After much research, and collaborative work, a new proprietary brand identity emerged—one that fully expresses its rugged, outdoor culture and connects with the customer. REI is now very much a lifestyle brand. The retailer's new identity was extended into a comprehensive visual branding system by integrating its outdoor culture with modern vernacular across all channels of communication. A strong internal branding program was also executed. It included employee training and an Employee Rewards Program. Result? Employees embraced the new brand identity and became ardent evangelists for REI. Their enthusiasm and strong representation of the REI brand has made evangelists of their customers, in turn.
REI then turned its attention to the retailer's customer touch points. Store planning, packaging, exterior trade dress, environmental graphics, apparel/gear marking systems, and all other customer communications became aligned with the revitalized brand identity. Certain private label products were enhanced to match the new retail brand identity. Management was given a brand management platform, a brand standards manual and a customer acquisition strategy to make certain the new identity would be consistently used in every aspect of its communications. These blueprints continue to serve the retailer well, as REI executes its expansion plans into the future.
Result? Strong, favorable customer perception that aligns with the retailer's brand identity. Employees who are truly brand evangelists, and customers who have likewise, become brand evangelists due to consistent, deeply satisfying, personal experiences with the REI brand over time.
Result? Upon completion of this comprehensive brand revitalization, REI posted a 200 percent increase in profit during an economic downturn and became debt free for the first time in 40 years. The revitalized brand is now in a strong position to take the company forward into the future.
REI enjoys a solid reputation among its competitors and is now undergoing a period of strong expansion into other regions of the United States. Its customers are devotees because they have a clear understanding of what the REI brand is, and they have experienced it on a deeply emotional level over time, cementing their loyalty to the retailer.
Strong retail brands have the ability to face any level of competition, thrive during any economic fluctuations, and grow and expand into additional markets. Over time, many retail brands must adjust with those conditions in order to remain relevant. These adjustments are much less disruptive if a brand has utilized that dramatic difference to establish a strong bond with customers and employees. The companies that don't will continue to experience internal disconnects with their employees, and ever more apparent disconnects with their customers.
Remember: the customer's perception is reality. If that perception is one of irrelevance, it will become increasingly difficult for that retailer to survive and thrive in today's competitive marketplace. While companies may recognize the need to revitalize, they should also recognize the imperativeness of it being comprehensive. If these retailers give their customers, employees, suppliers, managers and investors a real reason to believe, they will have a fighting chance in today's economy. If not, they will continue to fade into insignificance. That is, until they accept the "real reason to believe" as something to really believe in.
David Lemley is president of Lemley Design, a retail brand consultancy specializing in creating holistic branded customer experiences for retailers. Mr. Lemley can be reached at 206.285.6900, or by visiting his firm's website, www.lemleydesign.com.