Can an old brand that is in decline be rescued and revitalised?
It is possible but it won’t be easy.
When sales fall and profits disappear, it means erosion of the brand’s appeal has set in.
Rebuilding the brand profile will be tedious. The problems that caused the decline must be fixed before rebuilding can take place.
That means creative destruction. Tough decisions must be made to cut out parts that have failed or are no longer performing to expectation.
The difficulty of the task can be compared with reconstructing an old, decaying building whose parts are worn out instead of constructing a new building. Or launching a new brand which comes with no baggage, no negatives.
An example of a major global brand that underwent creative destruction and then reconstructed with a new management creative team is Gucci.
It had lost its exclusive appeal after it went into wholesaling. Family quarrels in the 1980s further tarnished its name. Today, it is back as the biggest-selling Italian brand in the world and the pinnacle of chic.
British luxury fashion brand Burberry suffered image problems after it changed designs to appeal to a wider market in the 1990s but rebounded under new management.
Jaguar is making headway in restoring its reputation for building prestigious and sporty cars after Indian investors bought over the British carmaker from American owners who were more familiar with mass production cars.
But the demise of giant British retailer Woolworth and Arthur Andersen, once one of the world’s “Big Five” accounting firms, is evidence that the destruction of brands goes on all the time, regardless of how dominant they were.
Some brands disappeared through self-destruction, especially during the dot-com boom in the early 2000s when companies inflated their value to ridiculous heights and imploded with the burst bubble.
Self-destruction, however, is more common with political parties because of the nature of competition in such organisations.
Their leaders fight each other all the time to climb to the top of the pile. In the process, they abandon good sense to expose the poor decision making and character flaws of their rivals until no voters in their right mind would want to vote for them again.
In Japan, the Liberal Democratic Party (LDP) that ruled nearly uninterrupted for half a century imploded over policy failures and factional rivalry. In Malaysia, Parti Bersatu Sabah (PBS) disintegrated in infighting after winning an unprecedented fourth consecutive state election.
Several other political parties in Malaysia are at risk of breaking up because of intense internal leadership tussles, replete with police reports of corruption and other wrong-doings.
Today, these once-powerful political brands are struggling.
They are like soiled white paper which some may find easier to discard than to clean it up.
Ironically, politicians are the very ones who build their individual brand images on public declarations of upholding integrity, delivering performance and ensuring commitment.
For corporations, creative destruction happens continuously. They close down or sell off businesses that lose market share; they create new businesses to stay in step with market shifts. The objective is always to grow their revenue and maintain their leadership position in the market.
Political parties are no different. They are all about leadership.
They must continually reconstruct to put in place appeal elements that are stronger than the competition, consistently and all the time.
Countries are no different. They brand themselves to strengthen their appeal to compete for tourists, trade, foreign investments, skilled workers and technology which ultimately translate into economic growth, jobs, income and a better standard of living.
The idea of country branding and imaging is as old as advertising, which dates back thousands of years, and first used by ancient empires to cultivate a common identity among their people and promote patriotism. The stakes are much higher today as globalisation expands trade and investment, and escalates competition between economies.
Products made in countries that have created a strong brand identity for themselves carry an extra aura. Goods they produce are perceived to be the best in the world, gaining worldwide acceptance quickly, and commanding premium pricing invariably.
Resulting from that, these countries have become synonymous with quality which, in turn, reinforces the perception that whatever they produce must be the world’s best.
Thus, mention the United States and you will think of cutting-edge information technology. Germany to most people means high performance cars. Italy stands out for unmatched lifestyle artistry; France for the world’s most expensive perfumes, Switzerland the world’s best watches, Japan the most innovative consumer products.
Malaysia has earned an image as a modern and progressive country.
We are a middle-income country with a vision to achieve fully developed nation status. We are known for many products and services that have enhanced our image. We are admired as the most developed of the developing countries.
We have modern skyscrapers, airports, seaports and highways.
We have many five-star hotels and world-class conference facilities that have hosted high-level international gatherings and attracted major world leaders. F1 races are staged at Sepang.
With more than 22 million tourists annually, Malaysia is a prominent destination on the international tourism map.
The country’s multicultural diversity offers a unique experience for foreign visitors.
This ethnic mix immediately distinguishes Malaysia’s brand identity from the rest of the world, and it is one of the country strengths constantly mentioned by foreign students who enrolled at Limkokwing University of Creative Technology. The campus in Malaysia hosts 9,500 students from 145 countries, the majority non-Malaysians.
Overall, Malaysia has 70,000 international students, according to the Higher Education Ministry, which make the country an important regional tertiary education hub.
With about 350,000 foreigners who seek medical treatment at our private hospitals, Malaysia is also gaining a reputation for quality healthcare.
People visit countries they feel are safe. People do business with countries they admire. People go to study in countries they trust. People admire people who achieve things.
All these say something about this country.
On the flip side, however, is Malaysia’s declining competitiveness. We are behind all the important East Asian economies in global competitiveness rankings.
In the World Bank’s Doing Business Report 2010, covering the period from 2008 through May 2009, Malaysia emerged at 23rd placing, below even Thailand which was ranked much higher at 12th.
Foreign direct investment fell from RM46 billion in 2008 to RM4.2 billion between January and May this year.
If we are losing market share as a country, we should be honest enough to admit that some things are not right and then look for the solutions.
Is this country seen to have lost its way? Or still clinging to outdated ways of doing things?
The current Malaysia – Truly Asia theme used in the overseas advertising campaign has generated interest and facilitated recall by tourists planning a choice of vacation destinations.
The kicker has communicated Malaysia as a melting pot, with diverse cultures, delectable cuisines and friendly people who originated from all over Asia. To Westerners, Malaysia is a microcosm of Asia.
However, the Truly Asia theme has increasingly been blurred by similar messages promoted in tourism campaigns mounted by other Asian countries, such as India, Singapore, Hong Kong and the Philippines. The exotic mix of diverse ethnicities, food and cultures is everywhere in Asia.
Moreover, the emerging economic powerhouses of China and India now dominate the media and public consciousness in the West, which has further eclipsed Malaysia’s distinctive branding as an Asian holiday destination among international tourists.
We need to move on. Otherwise, every time we talk about Truly Asia, countries like Singapore will get a free ride.
Is the administration seen to be progressive, innovative, efficient, productive, fair?
If the government is perceived well, automatically a lot of things would fall into place and turn out well.
Beyond that, Malaysia needs to design a national brand strategy that provides for an integrated approach to position the country positively in the minds of people around the world.
The strategy will show Malaysia moving forward very quickly, very efficiently, very purposefully.
It should identify products that we will use to promote overseas aggressively and creatively. These products will give us the right profile and the right imagery, and carry the right message, be they surgical rubber gloves or budget air travel services or the Malaysian brand of education. They will show Malaysia as a sophisticated, an innovative country.
A lot of our characteristics already are those of a developed country. But any national branding strategy, to be successful in the long-term, must be dynamic.
If creative destruction is needed where the characteristics are no longer working or have lost their appeal, then it must be made.
Outdated structures, rules, control systems and decision-making processes must be abandoned. Revamp and reconstruct are the only ways to beat the market in a competitive global environment.
Tan Sri Dato’ Sri Paduka Dr Lim Kok Wing, the Founder and President of Limkokwing University of Creative Technology, does not fit into any ordinary mould that would describe most entrepreneurs.
His journey has been closely linked with the economic and social development of Malaysia.
Only 6 percent of the population aged 20-24 in Least Developed Countries was enrolled in tertiary education compared with 23 percent in other developing countries and 57 percent in OECD (Organisation for Economic Cooperation and Development) countries.
— UNCTAD Least Developed Countries Report, 2006
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