Brand Failure - Concepts And Causes

By
S. Ramesh Kumar
YX.R. Murthy

May 1996

Please address all correspondence to:

S, Ramesh Kumar/Y.L.R Murthy
Assistant Professor
Indian Institute of Management
Bannerghatta Road
Bangalore 560 076
India
Fax: (080) 6644050

BRAHD FAILURE _ CQHCEPTS AHU CAUSES:

Considering

the

proliferation

of brands

in

the

Indian

context and the failure rates brands have, it will be of interest

to

see

why

brands

fail.

Since

brand

failure

is

widely

prevalent phenomenon the reasons for the sane night be very many,
Explanations available in research show two broad
thrust

in

accounting

for

brand failure-

The

areas

of

set

of

first

explanations have an organizational/strategic focus.

The

second

have product/brand focus.

The

first set i.e., the organization

focused

explanations

for failure are as follows:

Abel's

well-known work on "Strategic Windows" mentions market

redefinition,
products
contended

as

new technologies, demand for totally new

the

that

reasons for product failure.

there is limited time for

which

types

Further
a

it

fit

of
is

exists

between the market's requirements and the company's capabilities.

A

product from an organization will be successful only

as

long

as the market-organization fit is managed well.

Hamel

and

Prahlad

did extensive work on

failure.

Their

account of the anatomy of strategic failure is as follows:Failure

results

from

unseen

competition or underestimating

strategic

intent

their resources.

of
This

among other things leads to competitive surprise,

lost

battles and eventual exit from the market..

Ganesh
cultural

tries

types.

to

fit all Indian

into

Some of these like "The goose that lays

eggs" (eg: Ponds) and "The growth loop

are successful.

organisations

golden

organisations" (eg:

The other types like "Humpty Dumpty" (eg:

Box) end up as failures.

six

BPL)
Metal

Here we see an attempt to track product

failure to organisational culture.

Chaudhari 4

Anjan
abroad.

In

examines

failure in

India

India 25% of 'project' failures are

as
due

well
to

as

input

problems, 41% due to management bottlenecks such as

incompatible

technology,

22%

marketing
that

poor

assessment

problems.

during

the

acquisitions
failures,

of

competition

and

He quotes a 1987 HBR study

period

1950 - 80 more than

which
50%

of

due
opined
all

the

by 33 leading European and American companies

75% of unrelated requisitions were failures.

project-appraisal

oriented

approach to

strategic

to

were

This is

failure

or

success.
The

second

set of explanations that have

brand/product

focus are now discussed.

Hamel
failure

&

Prahlad

seek

answers

in their product
to

oriented

four questions:

(i)

approach
Did

we

to

learn

anything to improve the product for launching it next time?

(ii)
3

Did we have reasonable expectations from the market?

we quickly recaliberate and try again
opportunity

warrant

answer to all

another

try?

(iii)

Can

(iv) Does the potential of

They

contend

that

if

the questions is a 'HO' only then can the

the

product

be termed a failure.

Hugh Davidson

analyses brand failures in the United Kingdom

and

concludes that most brands that fail are

are

products that are not significantly different from the

already available.
failure
eye

me-toos.

on

ones

He lists several behavioural reasons for

of new products - (i) hurriedly launched

being

Me-toos

the competition rather

than

the

the

products,

the

customer

(ii)

launching products simply because it is company policy to

launch

a certain number every year (iii) inability of brand managers

speak

up

against

development

products

that

are

rushed

through

to
(iv)

of vested interests around a new brand's launch

Overestimation

of

strengths

like

company

(v)

reputation

(vi)

Inability to look at changes in the environment because one

gets

too involved in brand development.

Rajan
failure

Chibba 7

in

a novel approach

calculates the Delta Habit Factor.

of

predicting

This is composed

the

rating that a product gets for 6 dimensions : (i)

the

duration

ocassions

for

of consumption of the product (ii)

the

use

of

the

brand
of

changing

evolving

new

product (iii) changing sharing

4

habits

of

the product (iv) changing frequency of

(v) Changing frequency of

the

use (vi) doing new things.

purchase
This leads

to the conclusion that inability to change usage / buying

habits

is the reason for brand failure.

After examining the literature available the authors of this
paper

have seen a need to categorise brand failure among

brands based on the commonality of reasons.

as

new approach towards understanding

classification
nor

is demonstrative, but is *

representative.

Indian

This is to be
brand

seen

failure.

neither

The

exhaustive

After studying several instances

of

brand

failure in the Indian market the authors are of the opinion

these

could be classified into 7 broad types.

could

be

cultural
brand

attributed
reasons

to

:-

(i>

These

Unrealistic

(iii) wrong positioning (iv)

that

failures

features
falling

(ii)

in

the

extension trap (v) lack of viable niche /segment (vi)

Me-

too strategies (vii) lack of attention paid to the life cycle

the product.

i)

of

These are discussed below:

Unrealistic

features:

Unrealistic

features

are

those

which lose their novelty after the "launch phase" or those

which

consumers are unable to associate themselves with.

home
"3-D"

theatre brand, VIDEOCON's picture~in~picture,

TV

psychology,

are examples.

According to the basic

"MERLIN"

the

HIKEYTASHA's
principles

of

an individual gets a feeling that he is involved

in

two

different

activities simultaneously because

system's

ability

fraction

of

to

switch between two

second).

of

the

activities

Consumers will find

it

human

(within

difficult

to

sustain their attention on two programmes on the same screen

hence

the

"POLAR"
yet

very

proposition

(fans)

another

of

"p-in-p"

becomes

which introduced fans with remote

example

to

show

that a feature

and

"myth".

controls

which

has

is

been

successful in one category need not necessarily be successful

another.

NATIONAL PANASONIC'S "Top Dome" TV model

had a

in

number

of channels but without the "S-Band" which is a pre-requisite for

television.
take-off

"KARAOKE" features of audio models

is another example which shows

which

technological

did

not

features

may not find favour with the target-segment.

ii)

Cultural

aspects

(reasons):

"Ms"

cigarettes

exclusively for women at a time when westernisation is

across

the

metres is a good example to

show

how

launched
spreading

inspite

of

"liberated" attitudes a brand could fail if it is pitched agianst

culture though the cigarette was strategically positioned for the
"liberated
The

professional" woman and not the "glamour-clad"

celebrity

chosen

melancholic roles.
was

was

also an actress

who

is

one.

known

for

"TANG" an international brand of orange juice

positioned in India as a breakfast drink.

Eating is one

of

the most deep-rooted aspects of a culture and changing eating and

drinking

habits

in

society is

probably

one

of

the

most

difficult
in

tasks of a marketer ("Kellogg" the multinational giant

cereals

is currently attempting it in

drinks/foods
examples.
aspects

is

another

'GREAT SHAKE"
of

category

which

India).

Soya

offers

based

number

from Godrea tried to sell the nutritive

a soya-based soft-drink in

vain.

Soya-based

products did not make a significant impact on the market

of

food

inspite

"packing" the protein aspects of soya in its granules.

the category of bread (branded) took two decades to get

by the masses.
number

of

and

only in the recent

times

it

is

competition. The British concept of lemonade (clear lime

drink)

("SPRINT"

palate.

CAMPA-LIME')

was unsuitable

to

Even

accepted

"MODERH" is a brand which has been around

years

of

for

facing
aerated

the

Indian

Wafer-choclates ("KRISP", "BREAK" from Cadbury) have not

made in roads into the chocolate market.

iii) Wrong Positioning:

Positioning a brand in the minds of

the

consumer is a major marketing decision as this is linked with the

perception

of

consumers.

Bad

positioning

can

ruin

good

product and a creative positioning could revive a sagging brand..

"THRIL"

a cola soft-drink positioned the product as a

drink with a number of celebrities.

a

time

even

"SAHDALWOQD

when
MUSK"

cola

market

soap from

space-age

The brand did not survive at

was

the

in

its

growth

manufacturers

of

phase,
"MYSORE

SAHDALWQOD" is another example which can be linked with illogical

positioning.

For

decades consumers have been viewing the brand

as

"feminine, delicate and soft".

associated

with

toothpaste

had

proposition.

"macho"

the
It

brands

Musk is a fragrance which

the

world

"spreading action" as

eight

over,

its

have been difficult

POND's

unique

for

is

selling

consumers

to

perceive this proposition (when competitors were taking different

routes
the

like cavity prevention, freshness etc.).

"Choco-cheer",

relaunched version of "Cadbury" drinking chocolate

catch

up

with the youth segment for

which it

was

"CROWHIHG GLORY" positioned as a soap for hair did

impact
of

not

positioned.

not leave

on the minds of the consumers (especially among a

competing and attractive propositions in the soap

'EZEE'

did

positioned as a liquid detergent a number of

an

number

category).
years

back

did not address a viable segment.

iv)

Brand-extengion

positioning

warn

trap:

Ries

and

Trout, pundits

marketers of brand-extension

trap,

of

that

is,

making use of a brand (which has been successful in one category)

by

extending

it typically to

another category which

little linkage with the original category.

has

Consumers who

very
have

all along associated the brand with a particular product may find
it

difficult to extend it to another category.

"EHFIELD"

which

was a successful player initially in two-wheelers did not make an

impact

with

strong

equity

"BAJAJ s"

its television sets.

in

chocolates

did

Even "CADBURY"
not

succeed

foray into lighting and "BATA's"

which
in

has

biscuits.

"HORTHSTAR"

fabrics

. . .8

are

other

examples.

wheelers)

there

positioningwill

have

another

ay

In some of
be

these cases

certain

strong

But a marketer of consumer

reasons

global example is

the

two-

apart

products

to analyse a brand's equity before

category.

("ALLWYH's

from

(especially)

extending
case

of

it

to

"XEROX"

failing to make a mark in computers.

v)

L&k

Q a

profitable,
for

met

segment

niche:

products.

A number of brands

are

on

of

specifically
adopting

this

successfully but there are a few brands which have

with much success over the years.

most

Focussing

small segment is an effective strategy

premium

strategy

viable

not

It can also be noted that

the successful brands in a number

of

categories

like

soaps, consumer electronics, cycles, footwear, two-wheelers which

attempt

niche

marketing

are

parallelly

successful

in

other

segments.
In
been

the baby powder niche market, "Johnson and Johnson"

successful but a

number of well known brands

have

probably because the niche has not developed much due to

reasons.

"MOTHER

failed.

Even

targeting

lower

CARE",

"GLAXO", "POHD's"

are

initially

not very successfully.

failed
several

brands

the global brand "RAYHBAH" (sunglasses)

price segments after

has

which
is

now

skimmming

the

higher

segments

While the

market

for

herbal

hair-care products have boomed in the recent

times,

the

market

segments

for

herbal

dentrifices

have

not

developed
9

inspite of ethnic traditional association with herbs, "VTCCO"

is

still

of

niche

player

in India inspite

of

several

years

existence.
v

i)

Me~tc?Q" Strategies:

A brand which has made a pioneering

ft

impact cannot always be copied by competitors who adopt

strategies.
of

After

noodles

the

emulated

success

the

of

"Maggi"

strategies

several

with

little

too"
brands

success.

"ROTOMAC" and "BRIL" have not achieved the success of "REYHQLDS".

Hone

of the follower brands tasted

the success of

"RASHA"

in

the "concentrate" soft-drink market. "HMT's" strategies have made

very

little

dent

lemony

drink

number

of

When
to

on

into Titan's quartz

market

share.

the lines of "Limca" failed

to

brands which have imitated "PAH PARAG"

"TRIPP"

take-off.
have

a pioneering brand has made an impact, it may be

compete

consumer.
these

with

the

Marketers

brands

brand in

the

perceptual

could succeed over

become

complacent

over

period

(automobiles, textiles, computers are examples).

discretion

has

to

be exercised in

nondurables

failed.
difficult

field

pioneering

of

brands
of

the
if
time

More

strategic

and

"impulse"

categories where failure rates are higher.

vii)

Stagfi

which

are

in tile, product life

catch

New-concept

in the introductory stage of product life

likely to fail.
to

cycle:

on.

products
cycle

are

"MAHARAJA" introduced dish-washers which is

yet

"Hegdey

and

Golay"

introduced

range

of
18

watches in the late seventies when the iiarket was at

introductory stage.
because

it

purifier

"HEW DELHI" magazine failed in the

preceeded

the magazine

boon.

the

eighties

"STERTAB"

water

product from TTK (in the form of tablets) was not

well

received inspite of promotional efforts.

In the case of established products (or brands) product life
cycle

necessitates changes over a period of time.

"PILOT"

which were once sought after are no longer in the lead.

market

matures,

either

in

it is necessary for a brand

to

terms of technology, product design

"FORHANS"

tooth-paste

after the

relaunching

pens

As

update
or

the

itself

image.

route).

(eg:

"BINNY"

which was almost a generic name in textiles once is not among the
top players.

"KORES" once a dominant brand in photo-copiers

has

lost its grip over the copier market.

CONCLUSION:
Brand success and failure occur due to a variety of reasons.
The

above

examples

demonstrative.
failure
brand

of
many

research
thereby
This

is

on

of categorisation

Often

of

failures

only the most important

is

reason

for

the

article.

a brand has been highlighted in

this

times

reasons.

fails

due

to

multiple

this topic could nake the

making

the

theory

of

categories

categorisation

a provisional schema far

merely

Further

water

more

the categorisation

tight

rigorous.
of

brand

failures in the Indian Market.

11

 11
REFERENCES
1)

Abell,

Derek,

"Strategic Windows", Journal

of

Marketing

Research, July, 1978.

2)

Hamel

G,

and C.K. Prahlad,

"Strategic

Intent", Harvard

Business Review, May-June, 1988.

3)

Ganesh S.R., "Strategic Orbits and Strategic Repositioning"

Indian Managenent April 1994.

4>

Chaudhari Anjan, "Parry the Pitfalls', A & M 28 Feb., 1995

5)

Haste 1

and

Expeditionary

C.K.

Prahlad

Marketing,

"Corporate

Imagination

Harvard Business

and

Review, Jul

Aug., 1991.
8)

Davidson,

Hugh

J.

"Why most new

consumer

common

brands

fail", Harvard Business Review, Mar - April, 1976.

7)

Chibba,

Rajan " Guarding against brand

failure", Economic

Times (Brand Equity supplement), Oct 20, 1995.