I’m always fascinated with marketing decisions made by companies. Companies spend large amounts of money to give their brands a certain image. Sometimes these are incredibly successful. Sometimes these are incredibly unsuccessful. Sometimes changes to a company’s logo seems like a simple change, but that can be a million dollar decision. Perhaps the example that stands out the best to me is when Pepsi changed their logo.
That change cost the company one million dollars. I’ve never taken any marketing or advertisement classes, but this kind of thing is fascinating to me. It doesn’t seem like it’s that big of a difference, but these things are incredibly thought out. You don’t believe me? Check out this document: Pepsi Gravitational Field.
Another Pepsi product, Tropicana, changed their logo around the same time as Pepsi did. But their change didn’t go over as well. Everyone knows Tropicana by their orange with a big straw stuck into the side. That was recognizable for people. When the company changed their logo and image, flattening it out and making things look a bit more simple and classic, people didn’t like it.
The NYTimes ran an article about the backlash to the change back in 2009 (along with an analysis of other logo issues with other companies). People were so upset with the logo change. NYTimes said,
Some of those commenting described the new packaging as “ugly” or “stupid,” and resembling “a generic bargain brand” or a “store brand.”
I haven’t done any kind of real research to verify this, but if I remember correctly before Tropicana changed back to their old logo they had seen 20% less sales in response to the new logo. Logos are important.
(Side story: When Starbucks changed their logo, zooming in on the two tailed mermaid and removing the text, I was curious about how much they paid for the change. I tried to look it up online, but I couldn’t find how much they paid for it. So I decided to email Starbucks and they emailed me back saying that they didn’t pay anything extra because they have a full time graphic design department and so they didn’t pay anything extra for it.)
So what happens when your company is struggling and you need an overhaul of your branding and marketing? Hire a former Apple Retail Chief Ron Johnson. Johnson is considered the brain behind the iconic Apple Stores and the Genius Bars. Before Apple he was responsible for the successful rebranding of Target, bringing in the Michael Graves line to help them with their image. His resume was pretty much impeccable.
J.C. Penney was not on top of their game with their CEO Mike Ullman, so he stepped down and they hired Ron Johnson for over 50 million dollars. Because of his incredibly successful history, I personally believe that Johnson was a bit too confident in himself. When he came in he fired many of the top J.C. Penney executives while bringing in his own people from Apple.
His tenure with J.C. Penney simply could be described as overly aggressive. He didn’t pay attention to any of the history of J.C. Penney. He ignored what brought in the current customers. He believed that he knew better than what studies were showing. He worked from that classic Apple attitude of “I know what customers want better than they do.”
What followed for J.C. Penney was a record loss of revenue. Johnson’s attempt to make J.C. Penney cool to younger audiences only proved to alienate their normal middle-aged customers. J.C. Penney never became a cool place to hang out and visit, which he tried to model after his Apple Store logic. Basically he pushed all of Penney’s loyal customers out by getting rid of their favorite brands and replacing them with dozens of new ones that they and younger crowds both didn’t like.
Ultimately Johnson was a miserable failure for the company and as of the beginning of this year he was fired and they brought in their old CEO Mike Ullman. Now they are trying to count their losses, and reset their image.
They recently released this commercial:
It’s no secret they messed up. Now they just want to get back to where they were, which wasn’t great but it’s better than where they’re at now.
Interesting way to market themselves. I guess we’ll see if J.C. Penney continues to fail or is able to rebound a bit. I’m also curious to see how much they’ll change the inside of their stores after Johnson kind of modernized it. Personally, being there somewhat recently with my wife, I think it’s a lot better than the way it used to look. But then again, I’m writing this on my MacBook with my iPad and iPhone right next to me…