Don’t let your Competition Out-Brand You!

I am sure many of you are familiar with the sad fate of Toys R Us. But, do you remember how it originated it’s online journey?  In the beginning of the Toys R Us online venture, they made a deal with Amazon to be the exclusive provider in their category. At the time, investors were delighted. They were of the opinion, “What’s not to like?” The best-known traditional toy retailer partnering with the most popular e-commerce retailer seemed like a win to them. Typically, this type of venture involves a significant investment in resources, IT and distribution. Toys R Us managed to do it with a handshake, inventory and a brand alliance.


Many believe the downfall of Toys R Us began because it pretty much gave up on branding the company and allowed Amazon to control the brand experience. No longer was the slogan people didn’t want to grow up because they were a “Toys R Us kid,” but rather because Amazon delivered the customer experience online that Toys R Us was famous for in the physical world.


However, what in fact happened was that Amazon’s online market share and branding grew at the expense of Toys R Us. As people increasingly chose convenience, Amazon cleverly navigated that route. Kids no longer joyfully frequented the aisles of Toys R Us stores with wide eyes. Instead, parents went online to Amazon and ordered the same toys as those sold by Toys R Us, but through Amazon… because they could get what they wanted without even leaving their home!


Toys R Us failed to deliver any branding message to its shoppers that would make them desire to shop at the physical store anymore. Once customers got used to the convenience of Amazon, and Toys R Us failed to have any real branding message, it became invisible in the eyes of the consumer and all was lost.


Most Amazon shoppers don’t pay attention to the actual seIler, they simply see the item they are buying is from the Amazon website. Who do you think gets the branding? Amazon.


Toys R Us assumed that if they partnered with the leading online retailer they would end up a winner. Amazon, however, simply wanted access to their inventory to provide a better experience to customers. An experience Toys R Us chose to outsource. In so doing, they sacrificed their brand recognition to Amazon.


For car dealerships, there is a valuable lesson here. Many disrupters entering the retail car industry space want to conquest your customers with promises of a more convenient path to purchase. Just like the Toys R Us/Amazon example.


How can you win at this game? Well, branding is a good start.


Could Toys R Us have survived if it maintained its branding? That’s a tough one as consumer sales shifted online. However, it could certainly have made a difference. Silence and a complete lack of any branding at all certainly did not help!


Good, consistent branding is so important in the retail world. In fact, it can help create a successful business or cause an industry giant to fail. The sad fact is that some dealerships place minimal effort in branding themselves, other than a little bit of traditional and digital advertising and, many times, even those aren’t consistent.


Today, dealerships are being accosted on all fronts. Industry disrupters, and even some manufacturers want dealerships that are somewhat uniform, generic entities.


Dealership’s would be wise to ensure they stand out and develop a brand strategy that is focused on their individual store or group in order to be successful in the future. And that should be on all fronts – traditional, retail and on-the-lot. It needs to immediately be clear to the customer who they are doing business with – not just any Ford dealership but, rather, ABC Ford. In doing so, it’s also imperative to include any value proposition you have to help brand your dealership and differentiate yourself from your competition. Free car washes, loaner cars, pick-up and delivery service – you name it. Make sure your customers know who you are, why they should purchase a vehicle from you, and include this in your branding.


A consistent and strategic branding strategy must be the focal point for all dealerships wishing to maintain consumer confidence and brand awareness.  


Protect and build your brand. Safeguard it. That is the most valuable asset your dealership has. Reinforce it as much as possible and this can help set you up to weather any future storm.

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