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Case Study: Skinner Baking Builds a Brand

The sales team pushed back, worried that branded Danish would diminish the locally baked feel of the product. "There are a number of large retailers that could have a significant problem" with branded baked goods, Dinnin said. "We're risking losing their business. Why would we change what's been working so well?"

Good question, given that the company had yet to approach its supermarket customers to discuss the change. In fact, Skinner Baking had done no market research to support the plan. All along, it was clearly Jim Skinner's desire to see his family's name on store shelves across the country that was driving the strategy shift. The meeting ended with the sales staff still on the fence.

A few weeks later, Skinner called another meeting. Greenberg flipped on an overhead projector and unveiled a six-slide PowerPoint presentation titled "What's in a Name?" The slides had headings such as "Encourages repeat purchasing" and "An identity associated with a promise and reputation." The presentation moved on to the drawbacks of lacking a brand: "Zero name recognition" and "Neutral consumer mindset associated with 'generic' products." Dinnin and his two regional managers started to come around. They were relieved to hear that prices wouldn't rise. Those $3.99 strip Danish and cinnamon rolls wouldn't suddenly reappear as premium-priced branded products.

But there was still one nagging doubt. "What happens if a supermarket doesn't want the brand?" they asked. Would customers simply walk away from Skinner Baking and turn to another unbranded supplier? Skinner couldn't promise that wouldn't happen. The best he could do was reassure the group that his gut told him such an outcome would be unlikely. "If they've been an account for 15 years and seen success," he said, "selling them shouldn't be that hard."

And that was that. Over the next year, Greenberg and Skinner's 23-year-old son David, who joined the company as its marketing manager, moved into gear. They decided the Danish packages would simply carry the full name of the company. "If you look at the history of brands," Greenberg explains, "there is often a higher degree of loyalty with a brand named after a person or place." The company would leave in place the design of the black labels, along with the images of colorful fruit, but would add the company's name in large red and orange letters. As supermarkets switched over, the company would phase out the unbranded business.

The label will eventually include "Skinner Baking 108," for the number of layers of dough in each pastry. The pitch line on the package: "Layers upon layers of flavor." The sales team has so far visited a dozen customers, showing up with samples carrying prototype labels. Dinnin says no one has ruled out buying the branded pastries, but no one has signed up yet, either. Jim Skinner isn't worried. Now, he's getting back to the kind of company his grandfather built.

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The Experts Weigh In

A Danish With a Future

The timing is perfect for Skinner Baking to think about the next step in the evolution of the company. There isn't a major national player in the in-store Danish category, and while other companies are playing it safe because of the recession, Skinner Baking is thinking ahead and setting itself up for future growth. This should result in a huge competitive advantage as the economy rebounds. I understand the sales staff's concerns, but customers aren't fooled. If something comes in a package with any kind of label on it, they know it wasn't baked in-store. They just want a product that tastes good.

Heather Henstock
Editorial director
Modern Baking
Chicago

It's Not About Grandpa

This sounds like more of an emotional play than a strategic play. Skinner should have put some money into researching whether using his last name would be the best move. Just sticking the owner's name on the label isn't necessarily the answer. I don't see what's in it for the supermarkets. I'm also worried that the company is pursuing two different missions. For years, it has been producing for other brands. Now, it's all about creating equity in its own name and increasing the value of its brand. Trying to do both at the same time seems to be a bit of a contradiction and can get pretty messy.

Phillip Davis
CEO
Tungsten Branding
Brevard, North Carolina

Everyone Loves a Family Name

Skinner Baking made a bunch of smart moves, starting with choosing a family name for the brand. A family name gives a connotation of having been handmade and of quality assurance. The company was also smart to keep current prices in place; you don't want to scare off retailers, and this allows the option to increase prices as the brand gains traction. I also agree with leaving the current labels largely untouched. The risk of losing customers who are familiar with the label itself outweighs the upside of attracting new people who are curious about a new label.

Brian Wansink
Director
Food and Brand Lab, Cornell University
Ithaca, New York

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Jason Del Rey

Senior reporter Jason Del Rey covers technology, branding, and company culture for Inc. magazine and contributes to the From the Reporters daily blog. Before joining Inc., his work appeared in Newsday, The (Newark) Star-Ledger, and the Staten Island Advance, and on ESPN.com. He lives in New York City. @DelRey