Brand euthanasia. Part 1
February 24, 2015
By Gonzalo López Martí – LMMIAMI.COM
- A brand is, broadly speaking, a two-pronged concept.
- Intellectual property + reputation.
- (The latter includes notions such as awareness, visibility, credibility, good will, trustworthiness &, duh, purchase intent).
- The survival and profitability of a brand depends on its power to enforce intellectual property plus its ability to protect & expand reputation.
- This week we will discuss intel prop.
- Well, it’s defunct.
- Gone.
- Kaput.
- Why?
- Because China & India.
- That’s why.
- In Chindia nobody can hear you cry.
- Roughly half of the world population lives in Chindia.
- If you add the Latin American block, Indonesia, Pakistan, Bangladesh, Nigeria & Russia, the sum adds up to two thirds of all living, breathing, shopping earthlings.
- In these fast-growing nations, needless to say, your intellectual assets are fair game.
- If some Red Army general or his cousin likes your song, your movie or your patent, he’ll take it.
- In broad daylight.
- No wonder Chindia is an ocean of blatant knock-offs.
- All we westerners can do is watch & whine.
- To no avail.
- The ability of western multinational companies to license and monetize their brands is extremely hamstrung in Chindia.
- Some big ones, say, Coca-Cola, have made headway at an enormous, grueling effort.
- The price?
- Allowing the Chinese politburo to be their business partner.
- A business partner who closely monitors and influences their operations.
- With two conditions: substantial profit reinvestment & massive transfer of technology.
- Now that’s a steep price.
- The profits you make in Chindia stay in Chindia.
- In short, Western companies doing business in Chindia are being played.
- And fleeced.
- Big time.
- Exhibit A: the Apple Foxconn entente.
- Just so you know, Apple’s entire output of iPhones & iPads is manufactured by Foxconn in China.
- Who needs who more?
- How long until Foxconn decides to launch Apple products under another brand (if they are not doing it already)?
- These would not be knockoffs.
- These would be, literally, Apple products with a different logo on them.
- Point is, as soon as the locals decide the carpetbaggin’ capitalist chaebol have been duly milked and squeezed, they’ll be thrown under the bus.
- Bye bye gaijin, you’ve overstayed your welcome.
- We’ll keep your know-how, your factories & your industrial secrets.
- And don’t try to push us around with international sanctions: we got nukes.
- I know, I know, chaebol is a Korean word & gaijin Japanese but you get the pic.
- Can we blame the Chinese for taking a page from our very own business manual?
- Course not.
- We should be flattered.
- By the way, do Xiaomi & Huawei ring a bell?
- How about Micromax?
- Hint: they are smartphone brands.
- Never heard of them?
- You will.
- Soon.
- In the meantime, google them.
- And buy some stock.
- OK.
- Back to the so-called west.
- In our neck of the woods (that’d be the US, Canada & Western Europe), IP still can be somewhat enforced, for the most part (IP is shorthand for intellectual property).
- The rule of law still protects it.
- In real life, that is.
- The moment you turn your head into the vast virtual/digital realm, protecting intellectual property becomes a bit of an exercise in futility.
- Infringement is rampant & commonplace.
- Chasing IP pirates around is like herding squirrels.
- Billions of squirrels.
- IP attorneys, brace yourselves for what’s coming our way.
- Seems like you’ll be very very busy in coming years.
- Or hopelessly unemployed.
- We’ll see.
- However it doesn’t mean brand managers, graphic designers or corporate identity theoreticians will be out of work anytime soon.
- Quite the opposite.
- Keeping up will be the challenge.
- The life cycle will be a constant rollercoaster ride.
- Euthanize your brand (before others do it for you).
- Create a new one.
- Repeat.
- Brands are dead.
- Long live branding.