Exploring how legendary brands can be upturned
[As seen in Global Retail Brands Magazine May 2021]
You have heard the “nothing is impossible” motivational speech from athletes, agencies and philosophers, but do you know one of the most iconic examples in Private Brands? You have to leave the world of food and grocery, and transport yourself to fashion industry, where this own brand triumph is having its 30th year anniversary. It is a notable achievement for any retailer, when you can transplant a successful CPG brand with a Private Brand and do it without any pain, without any repercussion from the consumer. But this is what happened in July 1991, when it was announced in the New York Times and other news agencies.
“Gap To Drop Levis”
Levis was a truly iconic brand, one that every consumer knows, and in the 1990s one that almost every consumer had in his or her closet. It is legendary, ubiquitous, and its roots in America are deep, and in turn, almost every fashion retailer sold the brand.
The Gap with its 1110 stores at the time (now around 3000), was one of those retailers who sold Levis and it was, not surprisingly, their #1 selling brand.
But even with Levis brand equity and power, it didn’t differentiate The Gap, and it didn’t provide uniqueness to the store’s experience, not to mention margin to the bottom line. This idea of developing an own brand to supplant a Legendary Brand didn’t happen overnight, and the decision to drop it didn’t happen overnight, but it was a heretical idea nevertheless.
In the late 1980’s, Levi’s accounted for about one quarter of The Gap’s entire sales, and this was down from 100% when The Gap store and eventual chain was launched in San Francisco. So, when you are trying to displace a brand that is dominant, it takes planning, courage and a strategy, and most of all, it takes the will to be the owner of your own destiny through differentiation and innovation.
Iconic Brands And Their Fragility
Consumer Packaged Goods and big CPG-led iconic brands are well aware of their fragility, and this is why they hire/train smart people, invest in innovation, and cultivate their brands through the constant churn of new media. In fact, they often seem one step ahead. Just look at the recent talk of CPGs hiring chief TikTok Marketing Officers to guide how brands are channeled through the most emerging apps like TikTok, but also through new media and marketing environments. Even with that, there are two things big CPGs and iconic brands cannot control:
- They cannot control the retailer, even though in some instances they are trying also to upturn this relationship (with Direct-To-Consumer).
- They cannot control changing consumers, some who are hell-bent to not follow the brand choices they inherited in their own families.
A brand like Coca-Cola, a classic American brand just like Levis, is a cautionary tale in this “fragility” too, as consumers are becoming healthier and they find Coke’s core product less appealing. In fact, their late CEO and business icon himself, Roberto Goizueta, anecdotally once said in the 1980’s that it would be Coke’s grand, mountain-top vision to be bubbling out of the drinking fountains and water faucets in every school in America, a vision that sounds downright comical today. Big brands are fragile.
The Impossible Is Happening
To displace a brand like Levis takes a lot of things as we noted – vision, strategy, planning, determination, and in some cases, even a little desperation, but what CPG brands are next?
Can we see a day where brands like P&G’s Pampers in diapers or Tide in Laundry Detergent are displaced by retailers? Could they ever be less loved by consumers? Could they be displaced by Challenger Brands with smaller media budgets who have savvier innovation, or could they even be edged out by retailers’ Private Brands?
I think it is possible, and the 30th anniversary of The Gap delisting Levis should be just another inspirational tale for own brands and Challenger Brands alike. As a further point of inspiration as to what is possible, just look at what continues to happen at a retailer like Costco and their Kirkland Signature brand.
There could be nothing more important to a human being than their own senses (sight, sound, touch, taste and smell), and losing even one of your senses can shake a person’s soul. Costco has such trust in their Kirkland Signature brand that they market their Hearing Aids within their portfolio, and there couldn’t be a greater testament to the relationship the brand has with their members/shoppers. Own brand hearing aids…….yes please.
Private Brands are doing the impossible, and it is happening in many categories across the world. If you are looking to make this possible in your business, then I would love to hear from you directly. In the meantime, happy 30th to The Gap, one of the first to take a legendary brand which was 100% of their sales down to zero, and do it through their own ingenuity and branding.
Perry Seelert is retail branding and marketing expert, with a passion for challenging conventional strategy and truths. He is the Strategic Partner and Co-founder of Emerge, a strategic marketing consultancy dedicated to helping Retailers, Manufacturers and Services grow exponentially and differentiate with purpose. Please contact Perry at firstname.lastname@example.org