Canadian companies fail to develop lifestyle brands with personality and this in turn limits their ability to stretch into other categories, according to experts, who warn that such organizations need to up the ante if they hope to compete in the global arena.
Few Canadian firms have long-term vision or the sense to fully consider a brand’s possibilities, says Patrick Rodmell, VP, global marketing at Toronto-based Watt International, a global brand strategy and design company. He believes this hinders a Canadian label’s evolution from product to lifestyle brand. ‘We’re still a conservative, product-brand society,’ he explains. ‘It takes an element of risk to extend beyond that, and we don’t have the kind of renegade approach to branding that appears in other markets.’
But due to the proliferation of brands, he warns, companies need to inject a dose of attitude into their lines if they plan to play in the big leagues. ‘Because there’s so much parody in features of product, we need to think about how to make that emotional connection,’ he says, adding that the most successful Canadian brands will in fact be those pioneers in lifestyle branding. ‘The smartest thing a Canadian brand can do is look at its attributes: Does it have a lifestyle element, and if so, what are the opportunities to leverage that?’
Greg Skinner, principal of youth marketing consultancy Mina, Toronto, agrees Canadians aren’t adept at building lifestyle brands. ‘Part of it is due to the influx of brands from the U.S., and part of it is that the Canadian market isn’t so competitive that companies think they need to deliver really smart brands.’ In Canada, he explains, ads are blunt and focus on product, while European efforts tend to be more clever and coy.
The reason why Canadians are so risk-averse is that they fear brand overextension, which causes brands to stray so far from their core equity they lose their original cachet. It happened to Pierre Cardin, which dabbled in clothing, fragrances, housewares and even plumbing in the ’80s. ‘They licensed the shit out of their name, so they had no control over what people were doing. You have to dedicate yourself to whatever you put out in the market,’ says Skinner.
There are ways to avoid overextension traps. The few Canadian companies that have developed brand personality include Roots, Club Monaco (which has since been swallowed by American fashion house Ralph Lauren) and Indian Motorcycle. So far, they’ve flourished because, for the most part, they’ve stayed true to their brand, which is essential in line extension, according to Mike Elwood, co-owner of Indian Motorcycle, which operates a café, lounge, restaurant and clothing store in Toronto, but began as a motorcycle manufacturer south of the border.
Elwood says he’s meticulous about where he steps with his brand, and admits he has rejected a slew of potential partners offering to slap his label on anything from scooters to ‘crappy’ watches. ‘If we’re going to do a watch, it’s going to be high-end, co-branded and a limited edition of 50 watches,’ he says. ‘That way you protect the quality through a relationship with a quality company, and you protect the integrity of the brand by not selling it to every Tom, Dick and Harry.’
However, Elwood does plan to ride Indian Motorcycle down new paths. He is currently in negotiations with Vancouver-based Intrawest Corp. to open Indian Motorcycle branded retail/restaurant spots in its hotels. So far the company is setting up locations in Collingwood, Ont., in July; Copper Mountain, Colo., in December; and a marina in Sandestin, Fla., in February 2003. Meanwhile, Elwood will also launch a radio Internet channel in mid-June, and eventually publish an e-publication. ‘We’re trying to put across the value proposition of the brand, which is quality, through these channels,’ he says.
A brand’s existing personality can impact its flexibility, points out Max Valiquette, president of Toronto-based youth marketing firm Youthography. Valiquette cites Porsche vs. Ray-Ban as an example. Porsche can glide into the sunglasses business because it already produces posh automobiles. On the other hand, consumers wouldn’t accept a car called Ray-Ban because, in their minds, the label is synonymous with the fusion of plastic and metal bits. ‘Part of it is an issue of what exactly a consumer will let you get away with,’ he points out.
That’s why a brand needs to delve into consumer research and find out exactly what the public thinks, before it pursues line extension. There’s a reason why Gap homeware never took off the way Club Monaco did in that area, says Valiquette. ‘Gap is about simple, basic clothing that’s modern, but quite fundamental, whereas Club Monaco has been about living with great style at a decent price,’ he says. ‘We can make the transition easier, and while The Gap and Club Monaco may define themselves in the same terms internally, brand overextension occurs when you fail to see how your consumer recognizes you.’
Another word of caution from experts: mind the competition. Mina’s Skinner, for instance, doesn’t think Reebok will pull off its branded sports drink – it recently partnered with Clearly Canadian to launch the beverage – because it won’t beat the powerhouses in that market; namely, Gatorade and Powerade. ‘Big brands, like Nike and Adidas, are being killed in niche markets, because you have so many specialty brands that know the market well or provide an interesting alternative to the consumer,’ he explains. It’s a principle Elwood lives by, as he refuses to enter into areas where the traffic is already heavy. ‘For us to have a fragrance, I’m competing against Chanel,’ he says. ‘Why bother?’
While the verdict is still out on Roots’ ability to thrive in the airline and vitamin industries, Valiquette says the brand has a better chance in categories where there’s room. ‘Roots can fill a hole in the airline market, and therefore, become synonymous with quality service at a decent rate.’
Rodmell, on the other hand, thinks Roots should have waited longer before taking off into the airline field à la Richard Branson, the British entrepreneur who took his Virgin record label to the friendly skies. ‘Roots has gone too far too fast,’ he says, adding that risk-averse Canadian companies are watching to see how far Roots can fly.
But even illogical extensions are possible when a company’s brand has ‘soul,’ says Thomas Pigeon, CEO of Pigeon Branding & Design. ‘The soul of Virgin and Roots are reasonably similar: they are about service, quality, integrity and a deep-rooted relationship with the psyche of consumers,’ he explains. Pigeon, who warns that a warped line extension can cast a negative halo on the mothership brand, believes Canadian marketers will jump aboard the lifestyle marketing trend soon. ‘People like Roots are busting paradigms and average marketers will stand up and say, ‘What can I do?”
