Goodbye brands: Nostalgia is not enough

Sarah O’Carroll
January 18, 2013
news.com.au

SOCIAL media was flooded with outpourings of grief this week over the closure of music retailer HMV and mobile retailer Crazy John’s.

Music lovers lamented HMV where they bought their first CD, which after almost a century in business is on the verge of becoming history.

But as tearful comments appeared online, music lovers continued to download the latest album from iTunes or stream it from Spotify.

The closures of childhood brands evoke feelings of nostalgia but it’s not enough to keep them afloat.

“Brand nostalgia is more about the person than the brand itself,” said Simon Rowell, managing director of Brand Intellect. “It’s an association with their childhood.”

But the truth is people don’t really care about brands and if they did they wouldn’t shut down.

“Brand nostalgia disappears pretty quickly and unless a person is directly affected by it because they worked with the company, then brand nostalgia doesn’t last long,” said Mr Rowell.

“It happened when Ansett closed down years ago. There was a fair bit of nostalgia but people forgot very quickly.”

“Brand euthanasia only happens when brands are unprofitable or unpopular or both or they’ve become that over the years,” he said.

“If a vast segment of the community really loved these brands they would still be thriving.”

Naren Sivasailam, senior industry analyst at IBISWorld said that the music industry has suffered over the past five years and it was no surprise that HMV was calling in administrators.

Music is often a trigger of nostalgia, as is chocolate, which was seen when Darrell Lea closed down.

“It’s nostalgia more than anything,” said Mr Sivasailam. “To see these brands go conjures up a lot of emotion. People cared for these brands.”

But with online shopping revenue predicted to grow by 9.1 per cent to reach just under $11.8 billion in 2013, Mr Sivasailam said that high street brands need to change quickly to stay alive.

“It’s not the death of the ‘high street’ yet. The majority of people still shop on the high street and will continue to for some time,” said Mr Sivasailam. “But traditional retailers will need to increase their focus on their web offerings.”

Customers’ attitudes are tested when it comes to putting their hand in their pocket and paying for goods or services and that’s when loyalty becomes real or imaginary, said Mr Rowell.

Even “high involvement brands” that people become really attached to – such as motor vehicles – are going under.

Yesterday the violins were out for Ford’s Falcon and Holden’s Commodore which will likely be phased out within months of each other in 2016, marking the end of two iconic brands.

“These are quite loved brands but not enough to keep them viable,” said Mr Rowell. “If brands aren’t flexible and adept to change nowadays they’ll disappear because things are changing a lot quicker now than they did.”

Last year brought similar tales of nostalgia when Rosella and Allans Billy Hyde called in the administrators.

Who will follow HMV and Crazy John’s?
A report in the UK found a further 140 UK retailers are in danger and will probably follow HMV into administration in 2013.

The brands most likely to disappear are those affected by shoppers moving to online such as specialists in music, games, books, news, stationery and health and beauty.

Predictions have already been made for the big brands that will fold in 2013. 24/7 Wall St has listed ten American brands that will go bust in 2013. Among them are:

American airlines: which filed for chapter 11 bankruptcy in November 2011, and despite planning to emerge as a viable airline, 24/7 Wall St predicts it will go under.

Research In Motion: which we know for the Blackberry. The company once owned the smart phone market for businesses but has been hammered by Apple, Samsung and HTC because it was too slow to move into the consumer market.

Avon Products: The global beauty product has a number of troubles including losing focus of its core business, compliance issues in China, restructuring and change of management

The Brands we said goodbye to in 2012:
Rosella
Allans Billy Hyde music
Darrell lea
Payless Shoes
Retail Adventures
Gunns
Hastie Group
Game Australia
Australian convenience foods group
Ojay
Comet
HMV (2013)
Crazy John’s (2013)
Jessops (2013)

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