Repositioning for growth

Are you getting the most from your brand? Three companies tell GB why repositioning led to a major acceleration in their growth

A great product or service will speak for itself – to an extent. But sectors evolve, and a brand that was relevant and thriving five or 10 years ago may not fit as neatly into today’s market.  Targeting a new audience with your offering, or honing your brand identity, could be the catalyst your business needs.

Needless to say, falling revenue is one indication that your brand may need a new position. But even if your growth curve is going in the right direction, talking to customers can produce some valuable insights. What do they really think of your brand? Is your image what you want it to be? Repositioning involves some tough decisions and is not an exercise to be undertaken lightly, so you need to ensure that any realignment of your brand really is a change for the better.

 

Growing Business spoke to three entrepreneurs who each held onto their brand’s name but changed identity – with impressive results. Here they tell us how and why they took the plunge and about the impact it had on the business. Is it time for a brand overhaul?

Best Western
Standing out in the marketplace
Best Western In brief
The Problem:

Lacking a unique identity, the company needed to differentiate its brand from other large hotel groups with chain propositions

The Solution: 

A relaunch campaign with the message ‘Hotels with Personality’, celebrating individuality of each member hotel and targeting ‘independently minded’ people

For hotel group Best Western, repositioning followed the realisation that the brand needed to differentiate itself.  The rise of boutique, independent hotels in the UK suggested that Brits were increasingly seeking out places with a bit of character. The senior management team realised that Best Western’s structure made it possible to tap into this.

Each hotel in the group is independently owned, and hotels range from 12th century castles to those that grow their own produce, those with deer parks and golf courses. This enabled them to celebrate the independence and variety of hotels within the group with a new position and strapline:  ‘Hotels with Personality’. “Because every hotel is independent, every hotel has its own personality, and we had a real opportunity to stand out against the formulaic hotel chains and say something very different about ourselves,”  says  Tim Wade, head of marketing at Best Western.  “I think the position appeals to a British mindset; we like our independent retailers and restaurants, so it was really tapping into that.”

Rather than going for traditional demographic segmentation, the new position targeted “independent-minded people, who don’t want the same experience everywhere”, adds Wade. “We already had the product; it was really about getting people to take notice or look at it from a different perspective.”

The relaunch was supported by an integrated marketing strategy, kicking off with Best Western’s first ever TV ad campaign in the UK, which was supported by experiential activity.  “We took a roadshow called  ‘Britain’s Got Personality’  around five UK cities. People got on stage and sang and danced and did whatever they wanted to celebrate their personalities.”

Entries were filmed and uploaded onto YouTube, where they attracted 50,000 hits. Viewers then voted for their favourite and the winning act will perform at the Best Western sales and marketing conference in September. “This was the first time we’d done something of this scale and integrated it into social media, and got press coverage around that,”  says Wade.

Additionally, much work was done to get the hotel owners more engaged with the brand – one of the biggest challenges. New toiletries branded with  ‘Hotels with Personality’  were made available for hotels to buy and a new website was launched.  “I think the brand’s really got into our entire business,” says Wade. “Everything we’re doing now involves thinking about how we deliver it with the brand in mind.”

Sales have increased by nearly 30% year-on-year, with corporate sales also up significantly. “The repositioning campaign has surpassed our expectations on a number of levels,”  says Wade. “We’ve had real growth – and we can time it to when the campaign launched on 15 April on TV.”

However, he warns that the brand repositioning was a  “huge project”, which should not be undertaken without thorough planning and research:  “You’ve got to make sure your positioning is right and really get the people in the business behind what you’re doing.”

Once the strategy was devised, it was tested with consumers at focus groups to establish whether the new positioning was really relevant and appealing to customers.  “This repositioning campaign has had great resonance with our target audience as our sales have increased the most year-on-year in our 30-year history,”  adds David Clarke, CEO of Best Western.  “It has been a highly successful campaign and ensured that Best Western is a group that stands apart from our competitors.”

The Foundry Reclaiming independence The Foundry in brief

The Problem:

Although a respected brand within the visual effects industry, following its acquisition by a large US firm in 2007 its new ownership began to hinder deals

The Solution:

A management buy-out, followed by repositioning the firm as an independent, small, quirky, British company has resulted in major commercial deals, fuelling growth

Award-winning visual effects software company The Foundry repositioned itself after a management buy-out (MBO) backed by venture capital firm Advent  Venture Partners in 2009.

In 2007, the business – which was founded by Simon Robinson and Bruno Nicoletti in 1996 and began life selling plug-in tools for visual effects systems – was acquired by Digital Domain, the LA post-production facility set up by James Cameron during the Titanic project.

Digital Domain had developed its own internal visual effects  ‘compositing’ system, Nuke, and enlisted The Foundry’s expertise to commercialise the product. In an industry mostly staffed by freelancers, one product typically becomes the adopted standard, and through a combination of hard work and serendipity,  The Foundry has since established Nuke as the leading desktop compositing product in the feature film effects space.

At the time, the current major player Shake was no longer part of the core business of its owner, Apple.  “They had ceased any real further development on the Shake platform,”  recalls Robinson,  The Foundry’s  ‘chief scientist’.  “We live in an industry which is hungry for innovation, so it was a ripe time to bring in a new product and promote it as the new rising star.”unlocking growth

However, by 2009 it made sense for the firm, which had taken over all further development and sales of Nuke, to reclaim its independence.  “Although we’d been very successful at what we were doing, we weren’t actually a key part of Digital Domain’s strategy. They’d managed to achieve the successful commercialisation of their internal product,” says Robinson.

At the same time, the MBO unlocked many new growth opportunities for The Foundry, including further contracts for Nuke, which Robinson believes would not have been possible while the business was owned by a large post-production house in LA.  “It was actually beneficial to us at that point to divorce ourselves from Digital Domain, because there were a number of companies who were probably a little reluctant at the idea that they would be giving money to a competitor,”  he explains.

“Also, if you were another post-production facility, you might wonder whether the product was really being driven for all of the customers worldwide, or whether the effort at any point would be subverted into what Digital Domain wanted. Independence from that made a huge difference to people’s perception of us.”

Repositioning, following the MBO, focused on  establishing  The Foundry as an independent, small, nimble, innovative, fun and  “quirkily British”  company.  “Once you are divorced from a very large American corporation, you can promote these ideas. And people like it, because the industry is seen as generally being fast-moving, flexible, innovative and quirky in its own way, so we fit into that,” says Robinson.  “We worked hard to ensure we promoted ourselves as a successful, British-owned company.”

This new position within the market has prompted a significant sales boost, with companies including Industrial Light and Magic (a division of Lucasfilm) and Weta Digital (co-founded by Peter Jackson) purchasing site licenses of Nuke  “where they were previously hesitant,”  says Robinson. It has also opened the door to IP licensing deals to commercialise other products that have been developed internally by major post-production companies, including: Mari, the texture painting system created by Weta Digital; Katana, a lighting and shading product by Sony Picture Imageworks (SPI) and a new product by Walt Disney Animation Studios. 

“These purchases [of Nuke] have had a snowball effect, which has significantly contributed to our current standing and probably facilitated the relationships with SPI, Weta and Disney, through which we’ve obtained technology that is driving us forwards,”  says Robinson.  “To our knowledge, Disney has never done this kind of IP licensing deal before. And it’s quite remarkable, then, that a small company above KFC in London can be their first.”

Indeed, The Foundry’s Soho offices can’t boast the glamour of an LA studio, and people are often surprised to find the business is based in London rather than California. However, this fits with the  “non-corporate look and feel”  – and appeal – of the company.  “We don’t have flashy offices with marble floors,”  says Robinson.  “We spend money on the things we feel we should spend money on because we’re a bunch of engineers at heart, who like to make stuff.”

Lucy Cooper, head of marketing, says customers appreciate this.  “One of the main things they buy into is the fact that we’re accessible,”  she says.  “Lots of our customers will probably have had a conversation with the CEO at some point, or can pick up the phone and talk to a person, and that’s something they don’t necessarily get from a larger software vendor.”

The Foundry has nurtured close, collaborative relationships with customers, which in turn drives product development and keeps the company  “in the loop”  on what film-makers are looking for. Development of in-house software is still going strong, and six of  The Foundry’s 90 members of staff (up from 47 in 2009) are now employed as full-time researchers, looking into new ideas. This  recently resulted in a new product called Ocular, which was developed when Weta Digital asked for advice on how to deal with Stereo 3D footage on visual effects masterpiece Avatar.  The product won an iAward last year, while The Foundry’s image processing plug-in Furnace won an Academy of Motion Pictures and Sciences Award in 2007.

Today,  The Foundry is a very profitable business,  “even though we’ve got large development teams now working on software,”  says Robinson.  “All of this new software is going to be driving our growth over the next couple of years and beyond.”         

                   

ST. Tropez Shaking off negative associations St Tropez in brief

The Problem:

An outdated brand with unwanted ‘Wag’ associations, St. Tropez looked to re-energise the brand in 2006

The Solution:  

Making the brand synonymous with beauty again and getting the key retailers on-side. New packaging, imagery and website         

When Michelle Feeney became CEO of St. Tropez in 2006, she realised that while the company’s range of self-tanning products was loved by consumers, research with the customer at key stockist Boots revealed the brand was outdated and had attracted some unwanted associations.

“The brand had the wrong image. The public thought the packaging was tired and the brand had become associated with  ‘Wags’ and too much tanning,”  explains Feeney, who was brought on board by private equity firm Lloyds Development Capital (LDC), which acquired the firm for £70m in 2006.

Feeney, who previously launched Crème de la Mer and worked with Tommy Hilfiger in the US, had recently returned to the UK after 11 years at Estée Lauder in New York, where, as vice-president of global communications for M.A.C Cosmetics, she helped grow the brand from $65m to $1bn at retail, and launched it in more than 40 countries.

Impressed by the quality of St. Tropez products, she saw massive untapped potential for the brand and encouraging similarities with M.A.C. Again, she was faced with the challenge of growing a niche brand while protecting its cult appeal.  “Our job was to evolve the image and not alienate customers,”  she says.  “I wanted regular customers to say it was even better and new customers to think  ‘that looks interesting’.” 

With the right positioning, Feeney saw scope for new product development and valuable brand equity in the St. Tropez name.  “To have that name synonymous with beauty is very valuable, because immediately it conjures up luxury and glamour,” she explains.  “My vision was to evolve St. Tropez into a beauty brand with a heritage of tanning, because tanning is a finite market.”

She has since expanded the product offering, with a range covering  “everything brown, gold, shimmery or sparkly”. However, it took a while to get the retailers back on side.  “They’d also lost faith in the brand because the packaging looked tired, the marketing was non-existent and there was no new product coming through,”  she says.

Strategic sales:

Central to her vision was a new distribution strategy. When Feeney joined the company the same product line was being sold everywhere, be it in Debenhams, Boots, or in a spa. Customer research with Pragma identified several key target groups: busy mums; girls who live for the weekend; one time users for a special occasion, and the more everyday customer.  “We looked at where that customer might want to buy us, and how we could be the best in those environments,”  says Feeney.

To facilitate the transformation into a beauty brand, Feeney approached Debenhams with the idea for a St. Tropez beauty counter (there are now 10), where cosmetics such as bronzing powders could be displayed, and beauty rooms where they could do spray tans. Boots and spas remain key stockists, and the brand has since expanded into Superdrug and Sainsbury’s.

The packaging, imagery and website have been modernised, while product innovation includes an award-winning  ‘Aromaguard’ technology, to disguise the tell-tale ‘self tan’ smell.  “They’d had the same visual for 10 years since the brand was started – a woman in a hat; it was sort of iconic,” adds Feeney, who re-shot this with top fashion and beauty photographer, Solve Sundsbo.

Glowing results:

The beauty concept has helped to distance the brand from negative associations in the self-tanning sector.  “In the premium cosmetics world I had always enjoyed very positive competition: Chanel, L’ancôme – that keeps you on your toes and raises the bar. With St. Tropez, the biggest challenge I was confronted with was negative competition, telling you to be fake,”  Feeney says.

Another key challenge was behind the scenes.  “The company had worked extremely hard to sell the product, but they weren’t beauty professionals, product developers or packaging specialists,”  says Feeney, who has enlisted a number of new senior managers, including her former brand manager at M.A.C UK.

Sales rose 33% to £60m last year – with no advertising. Growth has been driven by consumer PR and the brand’s new standing in the market.  “That’s all I’ve ever built brands on,” insists Feeney.  “It’s all about your reputation and word of mouth; and your packaging has to speak for you too.” 

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