The Dilemma of Brand Contradictions

All this has been good business for decades, and a strategy also found outside fast moving consumer goods. But we are starting to see some cracks in this multiple-brand strategy in the form of brand contradictions, as more parent companies find themselves marketing more brands that directly contradict each other's value proposition. It could soon become harder for leading consumer companies who have enjoyed a close marketing relationship with their consumers to communicate anything coherent and meaningful from an entire corporate brand perspective.

This tension at the corporate level may be forming because of a changing focus from product qualities that were important decades ago—value, reliability, and popularity—to what is becoming more important today:health, wellness, beauty, and environmentally friendly. The reason these product qualities have greater appeal now is not only because of our aging population, but more importantly, who is doing the aging, and how they want to age. That is in part why Global Insight is forecasting 5.5% annual growth in the consumption of just medical services from 2007 to 2010, and about 8% annual growth in personal care and health-retail channels for the same period. Here are some examples on how demand for these more personal product qualities is creating some odd situations in the trade:

Honest Tea's Sweet Ride

As you read this article, there is a case of Honest Tea somewhere, sitting next to a case of Coca-Cola in one of their distributor's trucks. What makes this odd is that on some Honest Tea's labels there is the message, "Honest Teas are sweetened with a touch of organic sugar or honey—never high-fructose corn syrup. The result is a subtle flavor and a sixth of the calories of the super-sweet tea-flavored drinks." While not a direct attack on Coca-Cola, it does gently attack the most popular sweetener found in soft drinks. Why are the two being shipped together? Some Coke distributors started distributing the product to offset sluggish sales of their core brands.

Beauty and Coca-Cola

Coca-Cola is also working with L'Oreal to create a beauty product that will target "active and image-conscious" women over the age of 25. The tea-based drink will be called, Lumae, and will contain ingredients helpful for skincare. The oddity here is that the path from refreshment beverage to beauty is not short, especially after years of cola companies positioning themselves among the buzz of calories and taste. But the direction Coke is taking is clear, and the health trend it is riding is even clearer.

The Philosophy of Fuelosophize

PepsiCo is also finding some brand contradictions in Whole Foods, where it quietly began testing a new high-energy protein drink late last year called, Fuelosophize. The initial experience of working with the health-food giant must be strange for the beverage-maker. Not only does its namesake not work where an increasing number of shoppers buy their groceries, but it also can't rely on slotting fees there (the practice of paying retailers to shelve their new products). Just to show how far the company is trying to move away from its traditional cola and snack value proposition and more towards the growth, CEO Steve Reinemund reportedly said before he retired that he wanted PepsiCo to be known as the corporate leader of the wellness movement in America.

The Gold Rush of Organics

The sustained demand for organic foods has naturally created a gold rush of sorts for traditional consumer goods companies to either develop their own offerings or acquire existing organic brands. This has caused all kinds of potential brand contradictions. For example, General Mills decided not to put its ubiquitous logo on Cascadian Farms, the organic cereal it acquired. General Mills must have calculated that the parent brand, which has done so well for decades, might turn some consumers away. However, Heinz, the producer of popular condiments used to add flavor to all different qualities of beef, recently came out with organic ketchup. It might work well, but the problem with established brands developing organic alternatives is that the organic version can make the established version appear inferior.

Shifts in Packaging

As bioplastic companies get closer to commercializing full lines of biodegradable packaging materials on a large enough scale to make a real difference at the shelf (and in landfills), there is a marketing risk to those companies that won't be able to convert their entire portfolio soon enough, if at all. Perhaps the first bioplastics will not be as strong as what they are trying to replace, or the materials may initially cost more, or won't be as microwavable. Regardless of the challenges, brand contradictions might emerge similarly to what is happening in organics, where companies are forced to have some of both because of all the consumers they are trying to satisfy. From a parent brand perspective, all this won't be impossible to communicate; but in a marketing world that has devolved messages to the most simple, it won't be easy.

Cracking Brand Architectures

Building brand architectures (i.e., the practice of structuring brands within a single portfolio by defining each brand's relationship to the corporate brand, and to the others) should be providing some guidance for navigating all these brand conflicts. But are brand architectures really working? Are they even sustainable in rapidly changing markets? Brand architectures may have just made sense in more stable markets when the product qualities consumers valued were more predictable.

In Al and Laura Ries' book, The 22 Immutable Laws of Branding, the authors describe something more basic, and perhaps more useful, to what many marketers are now facing with their expanding portfolios and shifting consumer product values. Here's what the authors say about one of the laws – the law of the company: "The issue of how to use a company name is at the same time both simple and complicated. Simple, because the laws are so clear-cut. Complicated, because most companies do not follow the simple laws of branding and end up with a system that defies logic and results in endless brand versus company debates. Brand names should almost always take precedence over company names. Consumers buy brands, they don't buy companies."