Will your brand die any time soon?

Three leading academics at Monash University have produced an innovative approach to the lifespan of brands that will be featured very soon in the renowned Journal of Business Research.

The academics have put forward the idea that it is normal for brands to die!

Professor Mike Ewing, Dr Colin Jevons and Associate Professor Elias Khalil say that the idea of brands being invincible is a myth. Their study argues that brands have a finite life span, and companies that expect them to last forever are just not being realistic.

The Monash study argues that every brand moves through stages: from birth, through growth, to maturity. The final stage, death, should be seen as a natural part of this life cycle. And every brand, no matter how big, is vulnerable. Remember Ansett, Oldsmobile, Atari?

According to the researchers, consumers drive the rise and fall of brands. They say two factors influence people’s decision to buy: firstly, the product’s use value, or ‘constitutive utility’ (basically, what it does for them); but more importantly, its ‘symbolic utility’ – what it means to them.

Brands are driven largely by this symbolic utility: people buy them primarily to feel good about themselves. The power of symbolic utility depends on two elements: the ‘boredom effect’ (meaning the product’s novelty starts to wear off after purchase), and the ‘status effect’ (which relates to who else buys it).

The status effect packs the most punch – and this can be both positive and negative. If people you count as part of your social circle (‘reference group’) buy the brand, its appeal will increase. But if people outside that circle (‘trespassers’ or ‘social climbers’) start buying it too, the shine will quickly start to wear off. This ‘trespassing’ effect is a major cause of brand demise. As more outsiders lay claim to a brand, its status falls. Once its appeal drops, demand also dwindles.

The researchers suggest that brand extinction can be stalled by clever revitalisation and repositioning strategies, but in the long run, this is just delaying the inevitable. While it’s impossible to accurately predict exactly when and how a brand will kick the bucket, it’s only a matter of time.

For marketers, planning ahead is better than living in denial.