If you were to ask people to identify the brands that they view in negative terms, chances each one would readily name at least one.
The reasons why a brand loses its reputation can be varied: a botched product introduction … bad corporate leadership … a poor response to a crisis.
But the net effect is usually the same: The damage takes only a short time to occur, and it can take years for the brand to recover (if ever).
Which brands are viewed as the “most damaged” in the United States right now? Recently, the staff at equity analysis firm 24/7 Wall Street put their collective heads together and came up with a group of nine brands that they feel qualify for the dubious “top honors.” They are:
- Best Buy
- Blackberry/Research in Motion
- J.P. Morgan Chase
- Martha Stewart
I find this list pretty much spot on. Most of them would probably be on anyone’s list:
Best Buy – Its big box stores function well as a place to “showroom” appliances and electronics for consumers … who then head home to purchase the same products online at lower prices.
Blackberry – Speaking personally as an owner of a Blackberry smartphone, is there any brand whose products have been more disappointing to its loyal users than this one? I doubt it.
Boeing – The highly touted Dreamliner 787 passenger jet has been delayed for years. Many consumers appear to be nervous about the model’s design, and recent developments portend … more delays.
Groupon – Groupon’s place in business history may be as the ultimate example of a dotcom-era “glorious failure.” Its business model, wherein merchants sign up for a scheme that’s guaranteed to lose them money, had to be “too bad to be true.”
JCPenney – I’ve blogged before about the predicament of this department store brand. In a stunning series of missteps, attempting to attract a completely different demographic of shopper while simultaneously dissing its loyal customer base turned out to be a sure recipe for damaging the Penneys brand – possibly irreparably. The odds are better than 50/50 that this store chain will now follow Montgomery Wards into retail oblivion.
Martha Stewart – Take an iconic business celebrity and send her to prison for insider trading. Meanwhile, her lifestyle media company is hammered by social media (Pinterest and all the rest), while television programming is splintering into more and more micro-segments thanks to the Internet and an explosion of new programming options for viewers. Is this brand even relevant anymore?
The remaining brands – Apple, Hyundai, J.P. Morgan – are ones that I feel have more inherent strengths and should be able to bounce back from recent setbacks. Provided, of course, that they make all the right moves and avoid any new pitfalls.
What are your thoughts? Would you nominate any other “damaged” brands for inclusion on the 24/7 Wall Street list? (I thought of Sears for one …) Feel free to share your thoughts here.
4 thoughts on “Taking Stock of America’s “Most Damaged Brands””
Apple? It may seem “damaged” on Wall Street because of the (precipitous) decline of its stock price. But that’s been largely because of concerns over its ability to maintain previous levels of explosive growth. Apple certainly has some serious competition—and challenges—these days, but I wouldn’t put them in the same category as Martha Stewart or JCP.
I think Wes touched on a critical distinction. The reputation of a company on Wall Street is not necessarily what “natural persons” feel about a company or a product. The complex global relationships of holding companies, markets and supply base further confuses the picture of relevance.
For an extreme fictitious example: While a Wall Street (natural) person might pick a new car or major appliance based on the reputation of its service contracts, a natural lower middleclass (NLMP – which by now is almost all of them) person will make decisions based on tangible, nickel-and-dime criteria. The same goes for reputation and what it means. The factual decision horizon of a NLMP probably never reaches beyond the limits of family tradition, good or bad experiences, and the conclusions drawn from it, right or wrong. What both, Wall Street and Jane & Joe share is a surprisingly high degree of irrationality.
The hordes flocking to ‘bargain’ stores to buy higher priced (per pound) large packages bear witness of that fundamentally religious/emotional relationship people in all income brackets have with their purchasing decisions.
So there is your reputation. Maybe it’s all about selling redemption anyway. (Which we never needed in the first place.)
And we are supposed to believe a study from any Wall Street company … Why?
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