Al Ries and I don’t see eye-to-eye on Megabrands

The 22 Immutable Laws of Branding by Al Ries is one of my favorite branding books out there.  In fact, it was one of the first books I read when I started full-time at P&G.  But though I generally have a ton of respect for Ries, I don’t see eye-to-eye with him in his latest AdAge article entitled “The Pitfalls of Megabranding.”

The reason is that Ries has the wrong definition of a “Megabrand”

Now let’s be clear; I agree with the basic premise of the article in that sku proliferation is a major problem in Consumer Packaged Goods.  Ries argues that brands are introducing too many flavor variations, such as the “11 flavors of Wheat Thins.”  These are more choices than a person needs, since they often just want the original flavor.  But that is a discussion for another post entirely.

What I want to point out is how Ries, one of the leading branding experts in the world, gets the concept of Megabrand wrong.  Here are the definitions that Ries uses for a Megabrand throughout the article, including how a “Megabrand” comes to be:

  • An innovative new product gets turned into a megabrand in a series of stages that can take decades.  
    • Stage 1: A company introduces a new brand that pioneers a new category. The brand stands for something specific and becomes red hot. 
    • Stage 2: No category can keep expanding forever. At some point, sales level off, so companies figure they need to do something to accelerate their growth, so they introduce line extensions.
    • Stage 3:After awhile, the numerous line extensions have undermined what the brand stands for. So the company decides to turn the extensions into brands and the brand into a “megabrand.”
  • “The whole idea of a megabrand is to strip the brand name of any actual meaning and turn it into a Paris Hilton. Famous for being famous.”

So the argument Ries makes is that a megabrand is a series of line extensions, including new flavors or skus within the core category, and that these extensions are done to provide “more choice.”  He even points out how P&G made a megabrand out of Olay and is doing it with Gillette at the moment. 

But I think Ries missed the mark on megabranding for two core reasons:

  1. Megabrands are not about new flavors, sizes or variants within the same category:  Ries is right about Goldfish, Wheat Thins and Gatorade having too many flavors.  But the fact these brands have multiple flavors and sizes within the same category is not a “pitfall of megabranding.”  A megabrand has nothing to do with having lots of sku’s….that is just about being a big brand with lots of sizes
  2. A megabrand is not about stripping the brand name of actual meaning…in fact it is just the opposite:   A Brand Manager can’t just wake up one day and say they are going to turn their brand into a megabrand.  It is a long process where you first have to create a distinctive equity and then you need to see what categories that equity would translate to.  Take Dove for instance, which proved the New York Times wrong when it emerged as a megabrand.  For years their bar soap stood for moisturizing.  They were able to extend that distinctive equity into deodorants, skin care and hair care because consumers gave them permission and believed in their equity.  And that is why Ries was right that Special K, Olay and Gillette are megabrands.  They have distinctive and ownable equites that can give them an unique position in categories they expand to.

Ries is generally dead-on with almost everything he writes about branding, positioning and marketing.  And he brings up a great debate when he says brands are bringing out new varieties just for the sake of new varieties.  But when it comes to saying that a meganbrand is just new flavors and line extensions without meaning, he is just plain wrong.

Comments

  1. says

    Good job of countering Ries on this one, Dave. While he makes some great points, he tends to follow his own theory out the window.

    One interesting side note on this, check out the NYTimes today on the new premium M&Ms.

    http://www.nytimes.com/2008/08/08/business/media/08adco.html?_r=1&oref=slogin

    We have a bag here in the office today and they are tasty, high-end candy. We argued about whether they were right to brand this as M&Ms or should have gone with a new brand. Someone made a good, simple point: “If they weren’t M&Ms no one would even know they existed.”

  2. says

    adapt to change, listen, utilize resources, be value added, have a compelling story and build a loyal long term sustainable relationship through the experience and quality of whatever it is you are leading, rock on!

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