Brand is a promise. Can you keep yours?
A brand is a promise. It is so true. Just like every relationship, a person's connection with a brand is built on trust which is hard to gain and easy to lose. And like every relationship, it goes through its phases. Customer needs to know you first, like you next, and then finally trust you. You can not violate that trust as it is your most precious commodity. Companies spend a long time and a lot of effort to gain their customers' trust but sometimes lose it due to their legacy systems.
We discussed before how companies behave like living organisms. In order to survive, they need to find ways to grow. They can’t be stagnant. There are three expansion strategies they follow. First, they can diversify their product offerings. They generally start with one product line and then expand into others while trying to become a lifestyle brand. For example, a fashion company may start with apparel first, move to accessories, and then take on to footwear. Second, they can expand across sales channels. For example, a sportswear brand may start with wholesale, quickly introduce e-commerce and then open flagship stores. Finally, companies can also grow internationally. They generally start in one country and then jump on to other regions through first distributors and then opening regional offices. Every brand I know has followed one or more of these three expansion paths during its lifetime. The biggest challenge they faced was to keep their promises to their customers as they embraced this growth.
Most legacy business applications are designed for certain product categories, channels, or regions. They are developed specifically to serve these niche markets. For example, you can easily find a low-cost plug-and-play business software if you are selling apparel wholesale in the USA market. Yet, these applications will fail miserably if you try to expand into a retail channel or move to another country. For another example, you can find a good retail system that can be deployed globally, yet it would not support your wholesale business. What I generally find is that the companies pick a low-cost legacy system that can do their starting product, channel, and region; and later try to customize it to do other products, channels, and regions - most resulting in failures. For example, a catalog-based company trying to expand to wholesale will have a nightmare trying to model typical B2B Accounts Receivable processes (net terms, cash discounts, chargebacks, etc.) in their legacy catalog applications.
In today's world, a brand can no longer survive offering just one product line in one channel in one country. Unfortunately, they make short-sighted system choices at the start. As they try to stretch their muscles, their business applications fail them. That failure damages the trust of their customers. There goes the promise. Next goes the brand. We cannot let that happen. The solution is to invest early into a single global platform that can handle different product lines across multiple channels.
If you are interested to learn more, please connect with me on LinkedIn, follow me on Twitter, or watch me on YouTube.
My name is Cem and this has been another gem.
