The living graveyard of failed extensions
I talked about the over-crowded extension graveyard in my book Brand Stretch. Now I learn that this graveyard actually exists for real in Ann Arbor, Michigan. Thanks to Chris Middleton of Futures Coaching for the tip-off about the article in The Guardian.
The article describes this place as follows:
It appears to be a vast and haphazardly organised supermarket; shelves are crammed with thousands of packages of food and household products. There is something unusually cacophonous about the displays, and soon enough you work out the reason: unlike in a real supermarket, there is only one of each item. And you won't find many of them in a real supermarket: they are failures, withdrawn from sale after a few weeks or months, because almost nobody wanted to buy them. The storehouse – operated by a company called GfK Custom Research North America – has acquired a nickname: the Museum of Failed Products.
So, if you are ever in Ann Arbour and looking to kill a few hours, you can browse this extension graveyard and see for real the likes of "Fortune Snookies, a short-lived line of fortune cookies for dogs", Pepsi AM Breakfast Cola and, yes, Colgate Ready Meals.
So, what can we learn from the extension graveyard, to reduce the very high probability that your next brand extension will end up there as well? The sub-title of my book was "Why 1 in 2 extensions fail, and how to beat the odds". The article actually says that the failure rate could be even higher at 90%.
Add real value
Brand teams can get too big for their boots, and fail to give enough respect to the competition in the market they are entering. They think they can win by offering limited added value versus what's on the market, thanks to the strength of their brand name. For example, Heinz tried to launch in to chilled soups with their Farmer's Market range, but didn't really add much value versus the category leader Covent Garden who had great quality, range and in-store presence.
Think business model, not brand equity
Too much time is spent by marketing teams asking "Can the brand stretch into market x?" If you have a strong brand, it is likely to be elastic, in theory. Could Lynx (Axe outside the UK) stretch from body spray into shaving? Of course it could, on paper. The brand had a great concept and one of the best testing adverts the brand had ever made.
But this is the wrong question. The right question is "Can we make ANY MONEY in shaving?" This question asseses your "ability to win". And here, the answer was a resounding no. Unilever lacked the manufacturing capability in shaving, and sub-contracted to a Chinese company who made a very average product. And the brand was up against the marketing might of Gillette. There was no sustainable business model in place, and the launch ended up in the extension graveyard.
Have a memory for mistakes
Again and again I see companies with a limited "corporate memory" who end up repeating the mistakes. As the article says, "Most surprising of all is that many of the designers who have found their way to the museum have come there to examine – or been surprised to discover – products that their own companies had created, then abandoned. Product developers are so focused on their next hoped-for success – so unwilling to invest time or energy thinking about their industry's past failures." Companies should keep their own extension graveyard so the can learn from failure.
In conclusion, to avoid ending up in the extension graveyard, focus your brand stretch efforts on ideas where you can add genuine value for the consumer, and for the business. And, think about setting up your own "museum of failed products" to learn from past mistakes.