A "brand" is one of the most valuable assets a company can have. Think about the products you buy, and you'll realize you're willing to pay more for a brand you trust. Brands are powerful, but they're not invulnerable. I've been learning a lot about what makes -- or threatens -- a brand from seeing a brand in crisis, having spent two days with the Firestone Tire Dealers as a speaker at their national meeting.
When I got on the plane to come to this meeting, I wasn't certain the Firestone brand would survive. But I now suspect the Firestone brand is a lot stronger than the average person can see just from the headlines. The reasons it is stronger are ones anyone trying to build a brand -- or a company -- can learn from.
Firestone is in the midst of a massive tire recall. The recall is not only costing millions of dollars, but has generated huge media coverage, congressional hearings, and class-action lawsuits.
Moreover, to the general public the Firestone/Bridgestone company did not appear to handle the recall and the media coverage well. Firestone is definitely under fire. But there's more to this story than has made the headlines.
First, let me state that I have no knowledge about the quality of the tires being recalled. I'm not a tire expert. But I've just talked to dozens of people who are, and their response has been a great deal different than I expected.
The people who attended this meeting are independent tire dealers: they do not work for Firestone. Almost all sell a range of tire brands in addition to Firestone. Some have the "Firestone" name on their stores. All are directly affected by Firestone's fate.
Before I got here, I expected these dealers to be angry, uncertain, questioning their future. They weren't. To my surprise, this group of over 3000 were almost universally loyal and certain of Firestone's recovery. Why?
First, because they had direct experience with the tires being recalled. Over and over, I asked dealers how many of the recalled tires they'd seen problems with in their stores. Repeatedly, I heard the same response, "None, and this is one of the best-selling tires I have." Only one dealer had personal experience with a similar problem, and that tire had more than 70,000 miles on it. So their own experience with the tires did not support the things they heard on the news.
As importantly, they not only knew the product, they knew and trusted the company. A majority of Bridgestone/Firestone's after-market tires are sold through what they call their "Family Channel" -- independent dealers, mostly small businesses. Firestone reserves some tires, including some of their best-priced tires, to sell only through independent dealers. In an era where large manufacturers cut out small retailers, Firestone has stuck by them. It's easier to be loyal to a company that has been loyal to you.
So what can you learn about building and protecting a brand from the Firestone crisis?
- Brands are built on building good businesses, not just good products: Business practices that treat your employees, your distribution channel, and others fairly will build the strength of your company, giving you increased loyalty to the brand.
- You can't control how your brand is perceived by the public: The power of the media to influence the perception of your brand is huge. You have to work hard to keep customers and resellers intensely loyal.
- Brands aren't built overnight: Some new companies believe they can build a brand through massive advertising campaigns. Brands aren't built on name recognition alone. That's a fleeting and very vulnerable market distinction.
- Have sufficient financial resources to withstand the unexpected: Since even established brands can be vulnerable, you have to be able to weather tough times.
Perhaps most importantly, you have to do what I call "wear clean underwear." In the final analysis, the future of any company is based on what they do (or don't do) "under" the image. Doing the right thing and having integrity in your business practices is the best protection of all.
Rhonda Abrams writes a widely read column on entrepreneurship and small business. Abrams is also the author of the well-regarded business plan guide The Successful Business Plan: Secrets & Strategies. She has started and built three companies, including her publishing company, Running 'R' Media, and her newest enterprise, RhondaWorks, which plans to offer a comprehensive online interactive business planning center. Visit Abrams at www.RhondaOnline.com.
Copyright Â© 2000 Rhonda Abrams