1. De-Branding as Re-Branding and the Bogeyman of ‘Internal Equity’
By Drew Letendre, BrandingBusiness
Copyright© Drew Letendre 2015
Contrary to reasonable expectations, some of the most important work branding firms do,
does not involve building or refreshing brands, but simply finding brands to retire or
replace—usually with other, existing brands from within a client’s portfolio. I hesitated over
the word ‘simply,’ because it’s rarely simple. Part of what makes ‘brand retirement’ difficult
is the intractable bogeyman of ‘Internal Equity’—that, and the entrenched business cultures
that create and sustain it.
Internal Equity as used here, is a euphemism for ascribing false or exaggerated brand
status or brand value to products, by their internal ‘stewards’. Internal equity is the brand as
conjured and perceived from within, rather than as measured from without. By ‘stewards’
I’m thinking here of product developers, marketers, sales people and owners of the P&L
centers, who believe they are dependent on these ‘brands’—as they see them—to achieve
organizational KPI, sustain their business units and keep their jobs. While this may be the
case to some degree, the problematic part is this: the untested assumption that the levels
of awareness and perceived value ascribed to these items, accurately reflects how they
are perceived and valued by customers. The protagonist of our story is internal equity as a
facile assumption of equivalence between internal perceptions and valuations of a brand
and those of the marketplace.
To be sure, it is not always the case that a product’s custodians are wrong in their
assessments of brand status or value. Sometimes they have very clear, accurate and
evidential knowledge of a brand’s real worth, its market value. In such a case, the internal
and external assessments match because the company actively builds, supports, tracks
and ensures the product’s brand value. They’re intentional about it. They make it happen
as a matter of thoughtful planning and execution. But more often than not, the
phenomenon of Internal Equity turns out to be a case of brand myopia. This is both
understandable and easy to explain: saturated day in and day out by the same brand
messages, names, logos and contact with the product itself, internal brands (as I’ll call
them) take on a large and compelling life of their own. From there, it is an easy ‘leap over
logic,’ to mistake internal familiarity (awareness, understanding and value) for external
perceptions and valuations.

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The problem with internal equity becomes more apparent when we move into the realm of
‘brand architecture’—how a business manages and deploys its valued strategic brand
assets to catalyze business performance and/or achieve strategic ends. A familiar tipping
point is when a company or BU portfolio becomes a populous, chaotic collage of acquired
product logos, with no clear organizing principle—the dreaded ‘NASCAR jacket’ syndrome.
When companies realize that they need to reduce, reorganize and re-deploy their product
portfolios in a manner that better serves strategic business aims and/or sales and
marketing activities, the logical first step is to identify and weed out the pseudo-brands
from the true brands—retiring them and re-assigning the products ‘behind’ them, to: (a) new
brands of their own; (b) to other existing brands within the portfolio or (c) converting them to
described products, endorsed by the parent brand. To be sure, the ‘calculus’ for making
decisions between these alternatives can be complex and will vary on a case-by-case
basis (and is beyond our scope, here). However, this formidable program of activity has its
inspiration and warrant in the Principle of Brand Parsimony: to create and manage the
smallest number of competitive brands that can be actively and effectively managed,
leveraged and grown.
What we have found in our work is that many of the acquired items in a client’s portfolio are
not (nor ever were) brands in any robust sense—things that are promoted, familiar and
understood, that are beloved or reviled or both. They are usually mere trade names,
sometimes trademarked, sometimes not. Yes, they have logos, type treatments, palettes—
all of the ‘outward and visible marks’ of a brand. But, there is no marketing budget, effort or
‘apparatus’ to support, manage or grow them. While the products behind them may be
bought and sold—may even be quite profitable—they have no real brand equity. They are
not, in a word, brands, and thus cannot leverage such value for themselves, nor impart
such value to the acquirer’s brand.
Still, as we have said, they can and often do represent ‘hard’ value to the business ‘behind’
the acquirer’s brand—they may represent steady, quiet streams of revenue that feed the
acquirer, without having or contributing brand value—the proverbial ‘Cash Cow.’ It could
even be that having or building a brand around such an item—calling attention to it,
associating it with the parent brand—would compromise its (behind-the-scenes) financial
role. In such a case, there is obviously no point in giving these items the infrastructure
necessary to make them into and sustain them as brands. It makes more sense to retire
their ‘brand accouterments’ and quietly merge them into a relevant product line brand
(where they can flourish or continue to flourish as saleable units) or leaving them as-is, with
their connection to the acquiring corporate brand left invisible.
This still begs the question: how do we distinguish the bona fide brand from the pseudo-
brand? By what criteria does one determine whether or not a successful, beloved product
is also an authentic, valued brand or is simply a ‘counterfeit,’ a mere trade name, not well-
known beyond the halls of the business it originates in? The obvious but expensive answer
is to conduct formal research into what customers and prospects know, don’t know or think
they know. Budget constraints often rule out this option, especially if the need is to make
determinations about large numbers of brands.

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So, while quantitative testing, with statistically significant sample sizes, is almost always
preferable, it can also be costly—prohibitively so. What’s the alternative (apart from
defaulting to the status quo)? BrandingBusiness has developed a research instrument to
answer the Internal Equity question efficiently, effectively and economically.
Based on logic, experience and professional consensus, we have identified a set of
dimensions (performance criteria) that help us assess brand status (awareness and equity)
indirectly. To get to such a point, we do not ask for ‘projections,’ ‘estimates’ or ‘best
guesses’ about a given brand’s market value, level-of-awareness or equity. Rather, we ask
questions which admit of quantitative answers, along dimensions that we know can tell us
something significant about brand status and value, that allow us to make intelligent bets—
things like: product history (number of years in existence), clientele (number of active
customers); competition (total number of competitive products in the market); promotional
support (whether or not a brand has a dedicated marketing/advertising budget or not—and
how much, etc.), number of positive or negative citations in industry publications, to name
only a few.
We used this tool to good effect with the Process Systems (PS) division of Saint-Gobain’s
global Performance Plastics business. PS designs and manufactures fluid management
technology—advanced tubing, pumps, valves, manifolds, gaskets and seals—for highly
specialized, often demanding applications.
Using the BrandingBusiness brand equity protocol, we assessed their portfolio of over fifty
SKU’s and identified just four genuine brands among them, around which the total offer
could be re-organized, simplified and more effectively marketed and sold. In the end (or in
the new beginning), we: re-purposed these four brands as functionally-defined ‘lead’ line
brands; refreshed their individual identities, re-named and/or re-assigned some of the
individual products under them; and in the end, evolved them into the new ‘brand
infrastructure’ of a more navigable, equitable and saleable portfolio.
DL