There
are no shortage of definitions for the term “brand equity.” You probably
have your favorite. This is one of mine, especially in the context of
the Penn State brand: “A
brand’s power derived from the goodwill and name recognition that it
has earned over time, which translates into higher sales volume and
higher profit margins against competing brands.”
The
reason I like this particular definition when it is applied to the
brand of Penn State is because of words like “goodwill” and “name
recognition” and “earned over time.”
Clearly
the Penn State brand, with Joe Paterno at the helm for over 45 years,
wielded the power that came from goodwill while garnering name
recognition, which in turn lead to higher sales and higher profit
margins – that in the university world translates to an increasing level
of enrollment and an increasing level of monetary donations from
alumni. All of which makes the competing brands green with envy for
sure.
At
its peak, which for all intents and purposes was anytime right up until
the world found out about Jerry Sandusky – the Penn State brand
possessed a tremendous amount of brand equity.
Yet as we now know, this once seemingly invincible and impenetrable brand, has been reduced to a mere shell of its former self.
A History Lesson
We
all know the line about history and what can happen when one fails to
learn from it. And history is replete with brands who, for one reason or
another, have failed or fallen victim to issues – some not even of
their own doing, which resulted in severe loss in brand equity.
- In 1982 Tylenol suffered a massive blow to its brand equity when seven people died after taking Extra Strength Tylenol laced with cyanide. After recalling 31 million bottles and losing more than $100 million, Tylenol rebounded and recovered to eventually regain 100% of the market share it had lost.
- In 2004 Martha Stewart was found guilty of conspiracy, obstruction of an agency proceeding, and making false statements to federal investigators. Needless to say her brand equity and all its various offshoots, took a major hit. Her brand recovered eventually, her daytime TV show is in its sixth season, and this fall she will have a new cooking show on PBS.
- On July 4, 2011, revelations surfaced that News of the World – owned by Rupert Murdoch’s powerful News Corporation, hacked into voicemail messages of murdered British schoolgirl Milly Dowler. Just three days later it was announced that News of the World would be shut down.
These
are just three examples of major brands suffering severe damage to
their hard-earned-over-time brand equity. Each of the brands recovered –
well except in the case of News of the World but obviously Rupert
Murdoch’s News Corp brand is alive and kicking despite the closing of
News of the World.
But
none of these brands needed to recover from the kind of damage that is
being inflicted on the Penn State brand. The reason being none of these
brands’ fall from grace, if you will, involved the sexual abuse of
children and subsequent cover up by the very people who A) built the
brand and B) were entrusted with maintaining its goodwill.
How
can the Penn State brand possibly survive this unprecedented – a word
that’s used a lot in talking about Penn State these days, loss of brand
equity?
In
the case of Tylenol for example, the problem was identified and
corrected as fast as humanly possible. Yes it took a great deal of time
to reestablish trust with the public but as you saw, it did happen and
can happen again for Penn State.
Or can it?
What Does The Future Hold For The Penn State Brand?
As
I sit here today I honestly do not know if the public will ever regain a
level of trust with the Penn State brand. It’s quite possible I would
have said the same thing back in 1982 about Tylenol. But I was only 17
and had a can of Spam for a brain, so.
But right now, do I think the Penn State brand can ever recover, I honestly don’t know.
Much
of my uncertainty has to do with what is still emanating from Happy
Valley. There are still far too many brand advocates/brand ambassadors
of the Penn State brand still steadfastly refusing to admit something
went terribly and tragically wrong.
There
are far too many who are entrusted with maintaining standards of the
brand – the board of trustees for example, who refuse to admit to the
public, much less themselves, that such atrocities were being committed
right under their very noses.
And
if those entrusted with the brand’s health and future cannot first
bring themselves to this fact, how can the brand ever hope to rebound
and recover? If they don’t think anything went wrong in the first place,
why would they ever think they need to repair and restore the brand?
Joe McDonough, VP/Executive Creative Director at Masterminds, a full-service agency with
a focus on brand integration, says it comes down to brands realizing
the responsibility that comes with achieving such lofty brand equity
status.
“The
more respected, more credible the brand, the higher the stakes and the
more critical it is to treat the public trust as the cornerstone of your
brand’s foundation,” says McDonough.
McDonough,
who has worked on such big name brands as MGM and Pinnacle
Entertainment, says the keepers of the Penn State brand made a fatal
mistake in the face of the crisis.
“When
the powers-that-be decided to go into damage control mode instead of
pursuing the ethical, or in this case – lawful position, the stakes were
raised to double or nothing,” he added. “Imagine if PSU had actually
gotten away with covering this up?”
Crisis
management consultant Dr. Ken J. Brumfield says the problems transcend
the playing field. “It’s not the football culture, but rather the senior
executive team culture that got them here,” says Brumfield, author of
the book “S.E.T. CULTURE: What Every Organization Needs to Know Before
Crises Occur.”
What Can Brands Learn From Penn State?
According to Brumfield there are three distinct things the leaders of Penn State need to do to rebuild its tarnished brand.
- Change the culture from the top down
- Make better decisions
- Seek outside help
Of course these are a lot easier said than done.
Changing
the culture means first admitting the culture was bad in the first
place. As I mentioned previously, I’m not so sure the leaders of Penn
State would openly admit their culture was bad.
As
for making better decisions, that of course comes down to who is making
the decisions in the first place. With all but one of the board of
trustees still in place, if not power, making better decisions than
those previously made may not be so easy.
And
as for seeking outside help, setting up advisory boards, etc. – that
too will depend on if the leaders of Penn State deem such an action
necessary and warranted.
For
his part, McDonough believes the best thing a brand can learn from Penn
State is that despite all the years one spends building trust with the
consumer, it can all come apart in the blink of an eye.
“The
public’s trust is hard won and easily lost. In this day and age it’s
the public who bestows the value of your brand upon you – they assign
which rung on the brand consideration ladder you grasp – but the hold is
tenuous and needs only the slightest negative momentum to send you
tumbling down,” he says.
“Now that ‘all media is social’
and every conversation can become a public forum that trends in the
millions for even trivial snippets of reality TV flotsam – the need for
stewards of brands of every scale to maintain actual credibility – not
just the veiled appearance of it, is paramount.”
Source: Live Science
No comments:
Post a Comment