After Kodak, Can Old Brands Survive by Re-inventing Themselves?
Kodak is the latest brand struggling for cash and has filed for bankruptcy protection. The photographic pioneer has over 130 years history – and they seemed to have made a successful transition from old school film and cameras to digital when digital cameras started to go mainstream – with the Kodak gallery as just one example of building brand relations with consumers and offering new products and services online. The problem there is a crowded market – newer and more modern looking versions of online digital photo printing companies have emerged and even the rather dull looking Picassa seems to have much more appeal. There are the obvious competitors including snapfish, photobox, digitalab and bonusprint and of course the almighty iPhoto.
It seems that their aspiration to become the new digital printing specialist, and their strategy to sell printers, even without making any money on them, to later gain profits on the sale and servicing of inks and parts, seems to have over stretched them somewhat and they are now trying to shed assets they can spare.
Loosing that Kodak moment
It may now cost them dearly that they did not focus more on increasing their brand value – more than 10 years ago, branding specialist Interbrand ranked Kodak number 16 of the most valuable brands in the world, estimated to be worth around $14.8 billion. Since then, the Kodak brand has fallen in both rank and value. 4 years ago it no longer appeared in the top 300 list with an estimated value of only $3.3 billion.
I am also not convinced by their strategy to become a digital printing specialist – is this really a future-proof market? With the emerging tablet market, reading news, books, etc and viewing photos has become so much simpler and more accessible already, with progress in the digital market how much of a need to print will there be?
Would it not be wiser to use the brand value they still possess and team up with another company to create something innovative and different, still capturing ‘that Kodak moment’?
We will have to see what they do about it now and if this latest move will help them to re-invent themselves with a good enough market share to thrive once again.
An innovation race – can Filofax still compete?
I came across Filofax a couple of months ago when browsing through WHSmiths and I thought ‘must research what their brand strategy is as they have become largely irrelevant with the rise of smartphones and tablets as digital organisers and diaries…’ And just as I sit down now to look into it, I am finding press releases regarding their new strategy. It all sounds very clever and positive… but it does make me wonder if it is a short term fix without a long term vision for the brand.
Jon Morse at Filofax says in an interview:
“With so many working days spent at a computer, we have seen many customers crave the tactile feel of pen to paper. Filofax offers the user a quiet, private moment and a solid hard copy of personal information.
Our strategy is not to compete with technological advances, but rather, to position ourselves as a fashionable, luxury paper-based product for those moments away from the screen. We find many customers using both a smartphone and an organiser.”
Gordon Presly, CEO of the Filofax Group, comments, “Our collaboration with Temperley London for Filofax was a natural development given Alice has a real passion for Filofax and importantly shares many of the qualities of our customers, as a creative individual, successful business woman and mother with a busy and fulfilled personal and work life. We were intrigued to give Alice full rein to create a bespoke collection that would give birth to her vision of the perfect Filofax for others to use when juggling busy lives, yet with a desire to look stylish. We take a long term view to our partnership with Temperley London as part of a wider fashion focused strategy, positioning Filofax as the ultimate lifestyle accessory for creative and self-fulfilled individuals.”
It seems an interesting repositioning strategy to aim at the luxury market – and collaborating with fashion designers such as Alice Temperley is an interesting interpretation of that strategy and allows to set a higher price point to the diaries, creating desire and establishing it as a sort of fashionista insider must have accessory. If this catches on with the young generation, and if their business can be profitable within the luxury sector (perhaps they could where they may sell less but for a much higher price and more margin), it may all be just lovely.
But I am a bit doubtful about the longevity of this strategy. Smartphones won’t go away any time soon. They come accompanied by an army of accessories – some luxury, some tat, so the ‘bespoke’ need in smartphone users is easily satisfied among a lot of different market segments.
Finding a point of difference
What does a Filofax do that a smartphone or tablet app won’t (other than the feel of the paper that you will curse when you have left it at your favourite hangout or in a taxi after a champagne reception at an exclusive art gallery…)?
With applications such as Evernote, where you can collect voice memos, notes, photos, videos, anything really and it is synced to your computer, with those invited to share the documents, and backed up, I can’t shake the suspicion that Filofax is going to be a victim of technology just like so many other brands that have vanished from our high street.
It is amazing how the brand has managed (and keeps doing so) to cling on to the executive and gift market – one can hardly describe this with ‘by re-inventing themselves’. It is more of a sense of familiarity, tradition and safe choice for the ‘more mature’ generation, but if they are sufficiently enthused brand ambassadors to pass on that passion for a paper diary to the next generation is to be seen. This Filofax site gives some great insight into the passion of the brand followers.
Hesitation – for and against the brand
I can’t see myself carrying one around a Filofax as well as my smart phone. It used to be quicker to just leaf through a paper diary and jot a note down but the latest models of smartphones are so interactive and easy to use, it takes longer to find a pen that writes than it takes to instruct SIRI.
As for the ‘creative individual’ – I do not leave the house without one paper based product which I use for gathering thoughts and observations; my sketchbook. But it would be hopeless as a diary and I would not see the point in spending a premium on it as a fashion item. When it comes to a sketchbook, for me personally, it is content over form.
However, there is the element of social and business etiquette where it may be frowned upon to pull out your iPhone or Blackberry during a consultancy meeting or a presentation to a client, but it would be acceptable to scribble notes in a branded, leather-bound diary. This is where I still see relevance for the product, and certainly for the brand, given that they offer well-designed, bespokable inserts to the leather cases.
So, what could a long-term strategy be?
Could they bring back production to the UK and make it a true luxury brand that becomes an executive status symbol? Perhaps they should also re-visit their website design to create a more luxury feel and to better translate their current brand strategy.
Certainly the luxury brands have many advantages of premium and budget brands. They are less likely to be hit by economic fluctuations. They play with the human basic instinct – which include ‘envy’ in some shape or form. They become status symbols we use to align ourselves with a certain group of people we want to belong to – they are tribal and due to the price factor this can be a very exclusive tribe that is a great aspiration for those not part of it.
Linking to the fashion industry – and making it more about the ‘outside’ and working on the ‘inside’ to be extremely customisable and clever could be a good strategy after all.
Another thought for long-term innovation
Whilst I would not invest in Filofax even with their new strategy, here is a thought that I find much more exciting (and challenging of course). Mr Letts develops a product with an Android tablet that is created to service future Filofax lovers – with bespoke diary keeping software.
That way, the leather bound, high quality, board room suitable tablet cases would be the link to the old. The bespoke software – it will need to be excellent – would be the link to the new. Bespoke collaborations are nothing new – remember SMART when Mercedes-Benz has not yet pulled out and the Blackberry Porsche is just a recent example.
It will be interesting to see where the brand is in a year’s time – and if they want to hire me, I am available from March onwards 😉