When you’re a hammer most things look like a nail. I am brand strategy hammer. Today’s nail is Brand Bankruptcy.
I worked for 7 months at a company that went bankrupt. The lawyers made money, vendors got cents on the dollar, employees were sent home and the manufacturing plant shut down. Thirty years ago, my father’s secretary claimed personal bankruptcy. Her credit card bills were astronomical. She continued working, I’m assumed with less new clothes.
Bankruptcy is a common state-supported financial practice. Ask General Motors.
Brand bankruptcy happens when there are not enough assets in the brand bank to cover a massive value hit. This is when poorly prepared brands go bye-bye. Tylenol had enough value to recover from the tampering scandal. Chipotle survived its food poisoning debacle. It may even have come out stronger. Coke’s formula change made a run on the brand bank, but it definitely emerged healthier, with more committed customers.
Every brand, every company, is going to have a natural or unnatural disaster. Building brand value and banking it, is what smart companies do. It’s prepper stuff.
Good brand strategy maximizes bank assets. It organizes them. Organize and calculate the assets you put in the brand bank and they grow and grow.