I read an article on Brandweek today about Unilever’s decision to sell its laundry care division in North America, which includes popular brands such as All, Snuggle, Wisk, Surf and Sunlight. According to Unilever’s spokesperson, Anita Larsen, the sale will allow Unilever to focus its efforts on growing its core brands. I can understand that much, but what concerned me as I read this article was the suggestion that Unilever’s decision is in line with a current trend of large corporations ditching brands that aren’t market leaders.
Apparently, the new strategy is this: if a brand leads the market, keep it. If a brand is second or lower in market share, get rid of it.
I certainly hope this is not a pervasive brand strategy that companies are following. Have marketers forgotten that the power of your brand comes not from being first in the market but from being first in consumers’ minds? If all companies followed this new brand strategy and flee markets that they aren’t currently dominating, then we’re in trouble. Just because your brand is not the leader, does that mean you should abandon your efforts and investments? Should you not pursue strategies and tactics to gain a stronger position in the realm of consumer perception? Should you not pursue creating a differentiator or an entirely new market where you can be number one?
I’m not saying that selling its North American laundry care division wasn’t a good move for Unilever. What I’m questioning is a growing trend among large companies to abandon brands that aren’t number one.
What do you think about companies running away from tough markets to focus solely on their strengths? In terms of Unilever, how many versions of Dove soap can they possibly make? Know what I mean?
Leave a comment and share your thoughts with Corporate Eye readers.
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