“A dog, crossing a bridge over a stream with a piece of meat in his mouth, saw his own shadow in the water and took it for that of another dog, with a piece of meat double his own in size. He immediately let go of his own, and fiercely attacked the other dog to get his larger piece from him. He thus lost both: that which he grasped at in the water, because it was a shadow; and his own, because the stream swept it away. ”
Greed may be good according to Gordon Gecko, but in most marketing scenarios, greed isn’t so good. The examples are too numerous to list, but here’s a few:
When the only car Volkswagen sold in the United States was the Beetle, it was the best selling imported car in the country. (Well, I guess they did sell those vans the hippies used to ride around in the 60’s too). But having the best selling foreign imported car wasn’t good enough for VW was it?
Here’s how they solved their “problem”. They produced several other models, including the Rabbit, The Thing, Golf, Jetta and Sirocco (also spelled Scirocco). Of course, these new models eventually diluted the brand image of “Volkswagon.” (By the way, who in the hell picked these new names? Apparently someone who had taken too many bong hits. I doubt if much marketing effort went into the name selection.) Only the recent re-introduction of The Beetle has helped VW make a respectable comeback.
Another company that gave in to greed was American Express (which had just a few credit cards to offer that owned 27 percent of the market). Then they got greedy and introduced a plethora of new cards including: Senior, Student, Membership Miles, Optima, Optima Rewards Plus Gold, Delta SkyMiles Optima, Optima True Grace, Optima Golf, Purchasing, and Corporate Executive, to name a few. The goal, according to the CEO, was to issue twelve to fifteen new cards a year. As a result, American Express market share dropped to 18 percent.*
Levi Strauss did the same with blue jeans. In order to garner a “wider” market, Levi introduced a different styles and cuts, including baggy, zippered, and wide-leg jeans. At one point, Levi’s were available in twenty-seven different cuts! Yet over the past seven years the company’s share of the denim jeans market fell from 31 to 19 percent.*
Military examples are even more ample. What if Hitler had not fallen victim to greed when he attacked Russia? (That’s scary to think about). Fighting a war (or a marketing war) on several fronts with thinning supply lines is tough and the chance of success is minimal.
One example of “marketing greed” (and idiocy) that I vividly remember— is that of Jack Daniels’ Beer. (They closed the brewery later that year.)
In 1997 (when I was managing the sales efforts of the Dick Broadcasting stations now owned by Citadel in Birmingham) we received an avail request for Jack Daniel’s Beer.
Yeah, that’s right— Jack Daniel’s Beer. I recall making the comment to the AE’s handling that account for WZRR and WJOX that the product “didn’t have a prayer”.
Jack Daniels’ image doesn’t coexist with the word “beer”. It could have been the greatest tasting beer in the world, but that was irrelevant. The name killed the product before too many frat boys could pass out from over-consuming it (try to buy Jack Daniels’ Beer today.) The Jack Daniel’s Beer example is a perfect example of what is called a “line extension”… which rarely, if ever works). If Jack Daniels wanted to get in the beer business, they should have at least created a new brand name (sans Jack Daniels name) to have any chance of succeeding.
Proctor and Gamble do a great job of avoiding line extensions and creating separate identities for their respective products.
It’s great to think about expanding, but line extensions or getting too greedy sometimes leads to cannibalism and loss of market share. Something to think about… ask RCA how they did in the copier business. Don’t get too greedy without studying some failures of the past.
*From The 22 Immutable Laws of Branding: How to Build a Product or Service into a World-Class Brand, by Laura Ries, Al Ries. © October 1998 , HarperCollins.