Obama vs. Romney is starting to look like Mac vs. PC, a case of reverse branding

Anybody else notice how political advertising has usually the opposite objective of consumer product advertising?  What I mean is political ads are usually focused on trying to rebrand the candidate's competitor as something negative vs. trying to sell the benefits of their own candidates.  For example, Romney has branded himself as a job creator, but the Obama team is focused on branding Romney as untrustworthy.  

Like any good marketer their anti-Romney campaign keeps pushing 'untrustworthy' as the primary theme or essentially trying to develop a reverse brand equity, and the marketing campaign supports this benefit statement with several different platforms of reasons to believe that help reinforce the equity, such as:

1) Suggest Romney will say anything to get elected and switches viewpoints when its convenient

2) Suggest Romney was responsible for outsourcing US jobs while at Bain

3) Suggest Romney lied about when he left Bain and may have committed securities fraud by doing so

4) Suggest Romney is hiding his money in tax havens because he is refusing to show his historic tax returns

This effort has forced Romney to spend a good portion of his time denying these charges, which just makes him look defensive and less trustworthy, especially because he has stubbornly refused to show his tax returns - the only proof of his innocence.  While its unfair, Romney started his campaign with a deficit of trust, not only because he's running against an incumbent, but also because the reality working against him is that many American's have a mistrust of the Mormon religion because different scares many people even in this day and age.

While I will not openly support or condemn these attacks on trust, the execution of the campaign is brilliant from a marketing strategy standpoint and follows the perfect formula for reverse branding and ingraining the equity/benefit in consumer/voters minds. A clear benefit that strongly resonates, supported by a clear reason to believe, and then when that reason to believe's shelf life expires and it's impact/breakthrough starts diminishing, rotating to new reasons to believe that all ladder back up.

Outside of politics, marketers rarely get a chance to reverse brand a competitor.  Though the best consumer product execution of this strategy was by Apple in their infamous series of Mac vs. PC ads:

Is it just me or is Obama vs. Romney starting to look like Mac vs. PC?  Reverse branding works when supported by enough reasons to believe.

Why is Proctor & Gamble advertising P&G?

As a former P&G marketer I'll admit that I have a lot of P&G loyalty, but every time I see one of the P&G Olympic advertisements I scratch my head.  It's not because I don't like the ads, you have to be heartless not to feel the emotion when they air the "Thank You, Mom" campaign...



...it's just I want to understand the end game for P&G.  There's no doubt the ads are emotionally moving, but the brand recall is all about P&G a large corporation that consumers have no emotional connection to, as opposed to say Pampers or Tide, which have a ton of emotional equity built up in the hearts and minds of consumers.

In short, I want to know what is the company's long-term strategy.  I say long-term because if the company was just trying to boost sales of its current business, there's no doubt it would have a higher ROI throwing this money behind an ad that builds up one of its leading billion dollar brands.

Such as these ads:





If I had to guess, the logic is that the overarching ads focused on P&G provide the backbone of the campaign and help tie all the individual brand ads together, but I'd actually suggest that the overall ad dilutes the individual brand ads because at some point they all start blending together in the consumer's mind.  Either way, its tough to try to build an emotional connection between a billion dollar conglomerate, and even if you do, then you still have the uphill battle of educating consumers on which brands are even made by the company.  Love the "Thank You, Mom" ads from a heart strings standpoint, but have a tough time believe its providing the company the biggest bang for its buck

Is Pepsi the "next generation" of yogurt?

Early this week Pepsi announced it is entering the Yogurt market via a joint venture partnership with German dairy company Theo Müller.  The joint venture will be run as the Müller Quaker Dairy and called Müller by Quaker and will begin by being sold in the northeast US.  It appears that they will offer at least 3 different types of yogurt: conventional, Greek, and Fruit Up (fruit mousse in top of the yogurt that gets stirred in).  The yogurt will be packaged in a square contained with one corner filled with an ingredient that the consumer can mix in; including caramelized almonds, tiny chocolate-covered crunch balls and granola.

Pepsi, which in addition to its traditional beverage business also owns Quaker, Gatorade, Tropicana, and Frito-Lay, is looking to diversify its portfolio as the soda category continues to be squeezed by health trends and the company looks to jump start long-term growth.


Why Yogurt?
Yogurt offers Pepsi three advantages.  First, its a fast growing category (+9%) that outpaces traditional grocery categories as its alined with consumer health an wellness tailwinds.  Second, it gets Pepsi into a new section of the store - the dairy aisle.  And third, Pepsi could likely leverage its refrigerated Tropicana DSD network to capture significant cost scale.


Will it be successful?  
Pepsi research suggests that Americans consume ~12 pounds of yogurt a year, which is half as much as Canadians and only a third the amount of Europeans.  Pepsi attributes this gap to the US category offerings being boring vs. international offerings: “It’s been an ‘I gotta have it because it’s good for me’ kind of a product . . .The 'wanna have it' was missing” according to Dr. Mehmood Khan, who oversees PepsiCo’s global research and development and was interviewed in a recent New York Times article. According to that article, Müller by Quaker will fill the current product offering void by offering a a new variety yogurt with its own unique texture that is between Greek and conventional yogurts.  The product will be marketed under the tagline "European for Yummy".  


While General Mills (Yoplait) and Dannon make up 50% of category sales, much of the recent category growth has been driven by Greek yogurt brands Fage and Chobani.  The fact that these smaller brands have gained traction and shelf space would suggest a brand backed by a CPG manufacturer with the clout and deep pockets of Pepsi would also be able to muscle its way into the category assuming the product is truly differentiated and delicious.  It also wouldn't be surprising to see Pepsi bring its soda strategy to life in this category by supporting the brand launch with an enormous advertising budget as well as running a significant amount of promotions focuses on BOGO's and bulk discounts.  The yogurt category has seen plenty of innovation over the past several years and I believe many category consumers are willing to experiment with new brands and flavors, but the category will remain highly competitive and unlike soda its wont just be a two horse race.


In conclusion, I believe Pepsi can clearly make a splash in the category and will help fuel overall growth.  However, I have a hard time believing the brand will climb higher than a #4 share behind Dannon, Yoplait, and Private Label, and may even have a hard time in the short-term outselling some of the hot Greek Yogurt brands.  One could see the brand, perhaps, ultimately reaching a 10-15% market share over the next 3 years.

Who let the Red Lobsters into the Olive Garden?

Darden Restaurant Inc, the operator of Red Lobster and Olive Garden, has opened three Red Lobster - Olive Garden combined store locations in smaller cities that they believe cannot economically support standalone locations.

As the picture below shows, the locations have two separate entrances entrances and dinning rooms, but reportedly share a bar area, kitchen, and bathrooms. Customers in one dinning room cannot order from the menu of the adjoining restaurant.

On the surface the strategy appears to make strategic sense, reach new customers by creating economies of scale to control costs and deliver incremental revenue.  Nevertheless, I question the overall strategy.  I would argue both restaurant chains have lost they way from their historic brand compasses and now currently suffer from a lack of authenticity.  For example I would venture to guess that many middle class Americans question how fresh the seafood at Red Lobster really is, while Olive Garden is hardly seen as real italian.  The fact that consumer sentiment has drifted from these initial positions is due to business decisions putting profit in front of brand equity.  The two in one concept further plays up the chain aspects of both brands and helps continue diluting their authenticity.  Then there is the old marketing rule that if do two things well enough it means you don't do anything great.

While Yum brands has executed this strategy on many of their fast food and QSR brands (KFC, Taco Bell, Long John Silvers, and Pizza Hut) with a major difference versus Darden's full-service restaurants being that they usually have joint dinning rooms, which enable families to all order different foods and then sit together delivering a benefit for the customer.

Applebee's "it's not a science show"

Give Applebee's credit.  It seem to understand its consumer and isn't trying to convince people it's something its not...For those that haven't seen it, Applebee's recently launched a new set of tv ads creating parodies off of the latest foodie trends - namely farm to table, heirloom, etc - in an effort to connect with their core consumer who are just looking for reliably good food at a good price.


I like the first ad better than the second ad because it hits home harder on the primary benefit that the food is a "good value and taste good" - because that's really why a consumer would choose to go to Applebee's.  Nevertheless, despite the parody, the ads still help portray Applebee's as using fresh ingredients - which is a nice halo benefit.


While I love the drama of the ads and believe they truly hit on relevant consumer insights, I have two concerns with how effective the ads will be in driving traffic. First the parody drama is a bit long, so there is a risk their core consumers may tune out the ad before the core message, and second, there could be strong brand linkage at the end of the ads. 


Overall though, bravo Applebee's, bravo...

Best Buy have a showroom problem?

It's no secret that Best Buy has had many business challenges lately as the chain faces declining sales and potential door closures.  Many analysts have pointed to showrooming for online vendors as one of the major culprits of Best Buy's woes.

Showrooming is the concept that consumers browse a product in a traditional brick-and-morter store, only to purchase it online at a cheaper price.  The primary case study of showrooming has aways been consumers browse and compare TVs in person at Best Buy and then ultimately purchasing online at Amazon where they traditionally haven't had to pay sales tax.

A recent analysis of the Stevenson Company’s TraQline market studies by the Consumer Electronics Association shows that while showrooming may be allowing Amazon to cannibalize customers away from Best Buy, its actually other brick-an-morter stores that appear to be more of an issue.

The study suggests that when it comes to purchasing a new TV, 48% of all TV shoppers visited Best Buy to browse the TV section.  Of these shoppers, over half (56%) ultimately purchased a TV at Best Buy, while 44% ultimately purchased somewhere else.  So where did these consumers purchase their TVs?  The TraQline data suggests that of the shoppers who visited Best Buy, but purchased a TV elsewhere: 

• 31% purchased at Walmart
• 9% purchased at Costco
• 8% purchased at Amazon
• 7% purchased at Target

So, while Amazon is siphoning of 8% of purchasers and one would expect that number to continue climbing, the data clearly indicates that Best Buy has larger challenges than showrooming for online vendors.  The data suggests Best Buys value equation is less compelling than many competitors.  As Best Buy continues to lose shoppers to multiple competitors that consumers feel offer better value, it needs to reexamine its overall value equation and better define its proposition for consumers.

Walgreens meet Boots

Walgreens announced it is buying a 45% ownership stake in European pharmacy giant Alliance Boots GmbH for $6.7 billion, with an option to buy the entire company before 2016. Together the two chains will operate more than 11,000 drugstores in the U.S., Europe and Asia, under the Walgreens and Boots banners.  While investors appear concerned with the deal as Walgreens stock slide 6%, here's why I like the deal:

• Allows Walgreens to bring Alliance Boots' strong private label stable of products to the U.S., including No7, which is the United Kingdom's leading skin-care brand. Its interesting that while the US drug store industry average private label penetration rate is only about ~14% (30% in healthcare), industry sources suggest Boots PL penetration rate is > 40%. Now some of this delta is due to differences in consumer psychology, but nonetheless, Boots' products and expertise should be an infusion for Walgreens. Walgreens has executed this strategy, albeit on a much smaller scale, following its acquisition of Duane Reade, a New York City based drugstore, which brought them "Delish", a premium private label food brand. So this move allows Walgreens continues to build its stable of exclusive brands that both have good consumer pull and high margins, while enhancing its value equation as according to SymphonyIRI’s recent Brand and Retailer Loyalty survey, >80% of consumers feel that store brand products are equal to or better than national brands when it comes to quality and packaging, while 95% feel that store brands provide a better value than national brands.
• Makes Walgreens the largest single purchaser of prescription drugs in the world, creating significant buying power to increase margins on the the most profitable part of the store already
• Creates the largest global pharmaceutical wholesale and distribution network with more than 370 distribution centers delivering to more than 170,000 pharmacies, doctors, health centers and hospitals across 21 countries
• Boots also gives Walgreens access to emerging markets like China.

Now it's tough to say from an outsiders perspective if Walgreens paid too much for the deal, but the merger at least opens up a realm of both top and bottom line possibilities.

JC Penney Changing Course?

After only 8 months on the job and in the midst of JC Penney's rebranding/turnaround efforts, Michael Francis, president, responsible for merchandising, marketing, planning and allocation, product development and sourcing has "resigned". Francis who was handpicked by CEO Ron Johnson based on their experience working together at Target had been Target's Chief Marketing officer prior to moving to JC Penney.

As President at JC Penney, Francis was technically responsible for the marketing of a controversial new pricing plan that aims to get rid of hundreds of sales events, as well as, merchandising and product development. However, many outsiders claim it was actually CEO Ron Johnson who was the architect of the new pricing plan. With the turnaround under performing expectations and JCP backtracking on a portion of their strategy, the resignation appears to be a way to buy time with investors - although shares did drop 6% after the news of the resignation became public. In the same press release, Johnson announced he will take direct responsibility and oversight of the company’s marketing and merchandising.

Three things pop to mind with this latest twist in the JCP saga:

(1) Turnarounds/brand restages are never quick and easy, business results usually get worse as a company invests in the future and consumers adjust their habits/practices. Being a public company sometimes creates a barrier to delivering long-term sustainable change because of this short-term pain.  JCP should expect at least 3-4 quarters of pain at minimum assuming they're doing everything right, and a lot longer if they are mis-firing on their strategy.

(2) Turnarounds must be based on significant consumer insights and must pivot off of a solid brand foundation as opposed to try to leap to a totally new brand equity - in other words the best brand restages are evolutionary not revolutionary. Additionally, the relaunch need to be communicated in a manner that consumers understand and in a fashion that's consistent with the consumer insights its based on. It appears to me that JCP is trying to leap too far too quickly and would be better served making a series of pivots.

(3) The CEO is not usually the best person to lead a consumer driven marketing strategy because they are usually the person in the organization farthest removed from the actual consumer.  Here's to hoping that Johnson relies on people closer to the consumer to help guide the strategy and commercialization.

The JCP turnaround efforts will be a fascinating story to continue to follow as its likely to be a long/winding rode for the near future

Pampers "Vertical Chair Climb"

I really liked new Pampers diapers TV commercial comparing a baby conquering his/her first chair climb to an olympic sport:

"The Vertical Chair-Climb. It's not an Olympic sport, but it takes real effort and it takes a diaper that fits their every move. Pampers Cruisers with 3-way fit adapt at the waist, legs and bottom for up to 12 hours of protection and all the freedom to play like a real champion. Pampers. Proud supporter of babies' play"

Not only does this ad immediately grab your attention, but it does a great job of letting the creative communicate the product benefit and reason to believe in a compelling manner, without beating the consumer over the head with a hard sell by packing in branding or forcing in too much of a technical product demo.


In fact the ad is far better than the following ad that's in the same "Olympic" campaign, which overdoses the viewer with very heavy branding and a few rather long technical product demo,

While the two ads communicate a similar message, the first ad does a far better job capturing a the views attention by starting with the 'drama' vs. branding and staying true to a single minded benefit and one clear reason to believe.

Only a Honda is a Honda, or is it?

Honda has recently launched a TV campaign trying to differentiate Honda from it's competitors with the tagline "Only a Honda is a Honda". The tagline is great, but does it really say anything? Or is it trying to draw a point of differentiation where none exists?

Honda rose to prominence in the U.S. in beginning in the 1970's with an equity built around affordable, dependable, and fuel-efficient cars. This strategy helped differentiate it from the American Big 3 and win market share. At the same time, Honda was able to separate itself from its compatriot, Toyota, because it leveraged a slightly sporty look supposedly born from its founder's racing history.

Fast forwarding to 21st millennium, American, European, and Korean cars have all essentially caught up with Honda/Toyota's reliability and fuel efficiency - essentially eliminating a big portion of what had made Honda a Honda historically. Not only that, but the Korean car manufacturers have enhanced the pressure on Honda/Toyota by continuing to undercut price, while offer a superior warranty and even including some historic luxury items in at base prices - thus creating a highly competitive value equation to help overcoming their weaker historic brand equity. Thus not surprisingly, Honda’s U.S. sales which were more than doubled the combined U.S. sales of Hyundai and Kia as recently as 2007, were only 1 percent higher last year.

So, when Honda says "only a Honda is a Honda" in their latest TV ads its moving into damage control mode.

While the ads don't mention any competitors by name they do make remarks implying that Honda is still the most reliable car on the market. For example one line claims that just because the competitor's warranty is reliable, it doesn't make the car dependable - clearly a reference to Hyundai's famous 10 year warranty. However, it's notable that Honda makes these assertions in a very vague and understated fashion - suggesting it may no longer have the ability to legally claim superiority. While Honda's brand equity gives it a reservoir of credit when it comes to dependability, the gap to all other car companies will continue to deteriorate as other manufacturers catch up. Thus, Honda must look to evolve its point of differentiation in order to remain a leader in the long-run.

Investment Thesis - Making Toys R' Us fun again

Toys R' Us was founded in 1948 and went on to become the biggest toy retailer in the US. But by the mid-2000's, Walmart, Target, Amazon, Big Lots, and Dollar Stores had jumped into the game and all cut prices on toys forcing many toy stores out of business. Facing declining sales Toys R Us was taken private in 2005 by KKR, Bain Capital and Vornado Realty Trustin a $6.6 billion deal.

Under private ownership, Toys R' Us tried to remain a relevant player in the toy industry by increasing private label and exclusive toys at the retailer. The company also bought KB Toys, eToys, and F.A.O. Schwarz. The company also converted ~25% of its locations into combined Toys R' Us and Babies R' Us stores. These moves were an effort to protect itself from competition and drive traffic into the stores.

However, these points of difference have not proven sufficient to fully stop the bleeding. The competitive pressures facing Toys R' Us continues to intensify and as its Private Equity owners consider an IPO, its time for consider options for future growth of its toy business. More specifically, given Toys R' Us is being cannibalized by both low cost vendors as well as more convenient vendors and the shift to a more exclusive assortment mix and co-locating doesn't appear to be sufficient, the company needs to find an additional factor that will draw customers into the store.

A solution is to dramatically change the in-store customer experience in order to build a stronger point of difference from competitors, to help limit price competition. One potential game changing move would be to turn the center of the store into a large play area taking the best of the playground and combining it with the best of Chuck E. Cheese, while merchandising toys around it. This play center could even potentially be turned into a revenue generator via ticket purchases. Not only would the play area would operate as a traffic driver, but also a testing ground by taking the toys out of the box and let the kids (and adults) play. For anybody who can remember walking into the original New York City F.A.O. Schwarz as a child, it would also help bring back the magic toy store once seemed to have.


The concept of "shoppertainment" has been proven out on plenty of smaller scales.  For example, Jordan's Furniture, a Boston based furniture founded in 1918 and now owned by Warren Buffett, applied this principle in one of their stores by building a Motion Odyssey Movie (MOM) theater/ride in one of there stores in 1992 and then later added an Imax theater in a different store in 2002. These moves not only created an instant traffic driver, but also a clear point of difference that couldn't easily be duplicated by its competitors.

Toys R' Us growth can come from expanding their mission from selling toys to entertaining children in and out of the store.

JC Penney offers "A Not So Square Deal"

As part of JC Penney's turnaround strategy they launched a new "Fair and Square" pricing plan at the beginning of 2012. The chain that for decades relied on multiple promotions, percent-off sales, and coupons to drive incremental consumption, has decided to put an end to all of those promotional vehicles in an effort to become less reliant on trade activity. 


This new strategy seemed to make sense given they ran 590 distinct sales in 2011 and drove 70% of its revenue from products sold at least 50% off full retail price. Rather than slowly peel back on the number of promotions, JC Penney decided to go cold turkey and rip the band-aid off with its "Fair and Square" plan, which simplifies their pricing strategy around three levels: "Every Day", "Month Long Value", and "Best Price". The "Every Day" or EDLP price was also lowered 40% vs. the prior traditional high-low pricing strategy.


The only problem is somebody forgot that consumer habits are hard to break and consumers, especially consumers of brands with weak equity and low consumer loyalty, also have very low brand engagement. The low engagement means that consumers are unlikely to realize you changed your pricing strategy in store or in your tv ads, but they will notice you no longer have sales or coupons.  Therefore, even if the absolute price in store is the same or lower, the consumers perception of the price point may actually be higher or they may not be motivated to visit your store without the promotional stimuli.


Hence, nobody should have been surprised when JC Penney announced its latest sales figures: "Comparable store sales for the first quarter declined 18.9 percent. Total sales decreased 20.1 percent, which includes the effects of the Company’s exit from its outlet business. Internet sales through jcp.com were $271 million in the first quarter, decreasing 27.9 percent from last year."


CEO Ron Johnson reacted to results by telling investors “We have work to do to educate the customer on our pricing strategy and to drive more traffic to our stores”.  Anytime a business leader or market says we have to "educate consumers" that should be an immediate red flag. I'm not a believer that consumers can be "educated", and even if they could, its going to be extremely expensive. 


If a new product or retail customer experience aspect isn't intuitive enough for consumers to figure out in a 10 seconds glance, then its not going to sell very well to mainstream mass market. This is why any good new product or brand building strategy has to start with a strong consumer insight and be brought to life in a simple manner that is intuitive.


Now, just months after the launch of the new pricing strategy, Johnson is admitting JC Penney made some mistakes. First, they layered back in 5 extra best priced Friday events, and second, announced that "We're moving away from the word 'month-long value' because no one really understood that, to calling it what we intended to do, a sale . . . Our marketing isn't doing the work . . . We've got to get our pricing across"


While this moves will likely help some, I for one am doubtful this will fix all the woes. As coupons and deals, spur incremental purchase not only because of the low price, but also because they make consumers feel like they are outsmarting their peers and adding time limitations drives consumers to act versus month-long promotions that don't feel as special.

Presidential Symbolism

I'm just as fascinated by presidential politics as I am by brand building. With the upcoming presidential election, I'll be sneaking in the occasional posting on how the candidates are building their own brands, or in both candidates cases partially re-staging their images. As the campaign heats up, pundits will be analyzing every last word the candidates say, while Obama/Romney will each will look to twist the other's misspoken words against them. This got me thinking on the importance of leveraging classic American symbolism to convey a message, while both leaving the pundits no place to run and elevating themselves to Presidential status. To this end, below is a reposting from a blog I started (though only had one post) on election strategery.

ORIGINALLY POSTED ON FRIDAY, AUGUST 20, 2010

Mosque Mess

Overview: On August 13, 2010, the President spoke about the proposal to build a mosque two blocks from the site of the September 11 terror attacks.

What Obama said: "Muslims have the right to practice their religion as everyone else in this country...And that includes the right to build a place of worship and a community center on private property in lower Manhattan."

These comments have been criticized by many on both republicans and democrats alike because they either disagree with his opinion that the mosque should be built - a CNN poll finds nearly 70% of Americans oppose the mosque - or they worry that his image will take another hit as he becomes further linked with Islam.

While I am one of the 30% of Americans that agrees with Obama and appreciate his want to do the right thing, I believe there was a more appropriate way to address the situation given the sensitivity of the subject.

What Obama Should have Said: "On January 20th, 2009 when I was sworn in as the President of the United States I put my hand on the bible and I took an oath . I took an oath, solemnly affirming that I would preserve, protect and defend the Constitution. And that oath, obligates me to preserve, protect and defend freedom of religion for all Americans."

While the substance of the message is the same, by invoking the power of the presidential oath, the constitution, and finally the bible, Obama's message would have carried more weight. In changing his approach, he would have left less rope for his critics to run with and lifted him above the messy debate.

What Apple can teach marketers

Everybody recognizes Apple advertisements as some of the best in the business.  They grab your attention, they're distinct, and they entertain.  But more importantly, they flat out are some of the most persuasive ads you will ever see.  That's because Apple has the best product demos in their TV advertisements of any company out there, by far, hands down.  Nobody is better at taking a complex new technology and making it look both simple and relevant to everyday life.

The first 4 iPhone Ads:


A few iPad Ads:



The ads communicate one simple clear product benefit and then leverages a series of product demos as reasons to believe in the benefit.  The art of the product demo is in the story telling as the ads always show the product doing tasks that you'd never imagine phones or computers could do, yet doing them in such a simple fashion that it leaves the viewer wanting more.

Now the reality is that the advertisements are based on the same consumer insight as the brilliant product design - make it so simple a 3 year old can understand it.  It sounds crazy to design the latest technology with a 3 year old in mind, but Apple's on to something in making products so intuitive (If you've ever seen a 2 or 3 year old pick up an ipad and just start entertaining themselves its mesmerizing).  Too often consumer goods manufacturers try to over engineer products, when the majority of consumers will chose the simple option nearly every time.  To Apple's credit they've unlocked this better than anybody else both in their product design and advertising.

Without a doubt the discipline Apple displays in its advertisements to not only keep them simple and relevant, but more importantly staying true to the product's primary benefit deliver a persuasive sales pitch.

Gap, heading down the wrong road?

Gap's struggles over the the last few years are no secret. In 2010, the Gap division has a total revenue of $5.8 billion, well below its pre-recession revenue peak of $6.2 billion in 2007. Unfortunately, 2011 isn't looking too much brighter for the Gap division, as North American stores report a same-store sales decline of (9%) versus year ago, while many of its competitors reported stronger than expected sales. These declines are despite the fact that Gap Inc. reportedly spent $70.5 million to advertise the Gap brand over the past year, according to the Kantar Media unit of WPP.

Given these troubles, its not a surprise that Gap management has been trying to shake things up in order to reignite growth. First, Gap tried refreshing its brand image by altering its longstanding logo - this effort turned into a public relations fiasco by causing a significant consumer uproar. Within what seemed like a matter of hours, Gap reversed course and restored its old logo, but not before proving just how out of touch the fashion giant is with its core consumers.

Now Gap is back at it again, trying to put a brand-aid on its sales challenge. Gap announced last week it would refreshen its image as the "People's Brand"

http://www.nytimes.com/2011/04/08/business/media/08adco.html?_r=1

The effort is being led by Gap's new chief global marketing officer, Seth Farbman, a former advertising executive from Ogilvy & Mather Worldwide. Farbman describes the “a people’s brand” positioning as a focus on fun, optimism and value for money.

Hmmm...does this positioning raise red flags to anybody? Thinking about this positioning from both a consumer and marketers perspective "Fun, optimism and value" sounds like the company may be confusion its Gap brand with its Old Navy brand. Doesn't Old Navy owns fun and value (at least in the mind of this consumer)?

So, why is Gap treading on its own tracks? Farbman claims “This is not a five-year turnaround strategy . . . This is a right-now.” Farbman is correct in that Gap needs to “set a clear point of view for the brand”, which it has clearly lost over the past few years; but Gap is losing sight of the bigger picture by not thinking about the longterm equity of both Gap and Old Navy.

I would venture to say Gap has struggled in its consumer positioning for a few reasons. First, Gap over-expanded its brand, which has caused it to lose some of its specialness. Second, as Gap Inc.'s other brands Old Navy (position: fun and value) and Banana Republic (position: sophistication and style), have effectively sandwiched the positioning of the Gap brand in the middle making it harder to find a unique space to own.

To get back to a position of growth, Gap needs to get back too its roots and focus on the basics.  Instead of trying to chase what it is not, Gap should embrace what it is - America's brand.  What made Gap so iconic in the first place.  The positioning should be optimistic and patriotic, with a focus on selling a modern take on the classical American lifestyle (bring on the swing dancing and all) - in summary a middle class version of Ralph Lauren.