It is easy to imagine why a brand might pursue this sort of activity. For Corona, sales that come from the RTD bay are almost certainly going to be incremental. It’s a similar argument for Kit Kat and cereal. Few of us find our sales targets easy to hit, so who wouldn’t accept the opportunity for a boost?
But I wonder about a hidden cost. Might consumers who have loved and respected Corona as an authentic and credible beer expert start to think less of it once they see the RTD? Might they think less of Kit Kat now the brand is on their breakfast cereal? It is hard to measure, and unlikely to affect sales or profits this year or next. But in the longer term, is this a good idea?
Some would argue there is something more important in the meaning of the Corona brand than just “great beer”. Yes, it does have additional emotional resonance and meaning, but I still wonder if its beer expertise and authority is lessened by this stretch. The same goes for Kit Kat.
I think it is safer for brands to focus on what they are truly about, to operate within their core proposition and expand only where relevant into adjacent spaces. For example, Innocent expanding from smoothies into juice made obvious sense.
The same principles apply in retail. The shops that have done well have been the ones that are best at being themselves. When Morrisons does Market Street well, it wins. The same goes for Asda and price plus optimism. Sainsbury’s with food ideas. Aldi and Lidl with relentless value. M&S with meal solutions and treats. Waitrose for cooks. Tesco the great all-rounder. The best work is done by those who innately understand what their brands are about, and modernise to deliver the brand promise better and better.
Ultimately, it’s about consumer understanding. Analysts may look at the demographics where a brand is weaker and, of course, the temptation is to focus effort there and drive towards “fair share”. But there’s a reason a brand is weak amongst some groups. It’s because consumers have preconceptions, almost always rooted in long-term realities.
We can try as we might to change their minds through marketing or innovation. But if a new activity or extension is not consistent with how we had previously behaved and talked, it will be hard for us to make real progress. An old boss used to use the Oscar Wilde quote: “be yourself – everyone else is taken”.
Brands can’t just do nothing and wait for the money to roll in. But it is critical to fully understand what your brand means to consumers and shoppers, then work carefully within the constraints of this understanding.