In order to stay fresh, relevant, and dominate their space, brands must constantly reinvent themselves. But does the traditional company structure itself suffocate a brand’s growth and evolution? Does the structure itself create its own roadblocks, choke communication, and suppress innovation?
Traditional corporate structure puts marketing higher in position and status than either sales or customer service. This creates the misconception that marketing knows most about what the customer wants when in fact, sales and customer service are the only two groups in the company that talk to the customer every day.
How did this structural upending happen? For one thing, corporations were originally developed to achieve efficiencies of scale based on divisions of labor and mass production. This worked fine in the old supply-sided economy where companies controlled raw materials and needed to sell them. It was only logical to seek marketing advice as to what products should be created out of those materials and how to advertise them. With this top-down approach, products were pushed through the system. Sales people were viewed as soldiers who executed the marketing plan, and customer service was viewed as complaint resolution.
This attitude was reinforced as universities began to offer degrees in marketing. Even today, you would have few options if you wanted to get a degree in the areas of sales or customer service from a major university. The media and the general public believe marketing alone is responsible for brand creation, growth and health. Yet, without the constant feedback from the customer that comes from sales and customer service, marketing can easily be blinded to the ever-changing market.
But traditional corporate structure has an answer for that – focus groups, sales and competitive analysis. The problem with reliance on these methods is that the information tends to be tainted by the questions, manipulation of the statistics, and following the market leader who may be about to fall off the cliff. These methods tend to be more of a justification for “Why we are doing it the right way,” rather than “What’s getting by us?” A rearview mirror approach can easily distract the company from what’s rapidly approaching in the windshield!
Traditional corporate structure is based on silos which in themselves can create turf battles and limit the free flow of ideas. Job security begins to take precedence over brand longevity. Each silo fights their battles for making their job easier regardless of the consequences to the brand or the company.
Production wants more standard packaging, simplified labeling and lower production costs – even at the expense of uniqueness, perceived quality, and brand promise. Legal wants bigger warnings, longer review periods, and watered-down rhetoric even if it means the ‘buy’ message takes a back seat. Accounting is figuring how much they could save by cheapening the package based on the misconception that sales will not be hurt. Marketing wants more money for advertising because their budget is based on how much they spent last year. Executives can feel pressured to make their mark on a brand to help their career even if it is inconsistent with the general public’s expectations of their brand image and promise. “New is better than good” becomes a slippery slope where the company begins to lose sight of what made the brand successful in the first place.
You can follow the competition, or try to save money, face and status. You can try to protect territory and every kind of perceived liability. Or you can try keeping your brand fresh, current and healthy by elevating sales and customer service in rank and status. Don’t let efficiencies of scale result in deficiencies of sales!
Who Are We.
Having built and sold a bestselling national brand, we appreciate the value of brands and everything it takes to make them successful. Companies are valued by their brand equity. Achieving and maximizing brand equity requires tremendous respect for all your customers, from your wholesaler to your end user.
Starting in our laundry room with no money and no knowledge of the industry, we built the famous Barefoot Wine brand. We learned a lot they don’t teach in school and much of it the hard way. Although our success was in consumer products, our real world experience will be helpful to anyone looking for information and advice about brands.
We have written the New York Times Bestselling Business Book, The Barefoot Spirit: How Hardship, Hustle and Heart Built America’s #1 Wine Brand, which chronicles the history of the famous brand from its inception through its acquisition. Our book is now required reading in schools of entrepreneurship across the country. We hope this book will provide inspiration and encouragement for all those contemplating starting a brand or wanting to improve their existing brand.
Michael Houlihan and Bonnie Harvey
-Barefoot Wine Founders