Today, the top story on news bulletins is the placing into administration of British Home Stores. BHS has been struggling for years. It was bought by the retail magnate Philip Green to add to his Arcadia stores group of Wallis, Top Shop and Burton’s but while those brands have survived and in some areas thrived, BHS has stumbled from one crisis to the next. Last year, BHS was sold for one pound to a group of venture capitalists who tried to turn the brand around and renegotiate its debts. Clearly, the new owner’s attempt at stabilising the brand have failed.
A major contributing factor is the failure of BHS to innovate their brand. The company was one of four high street retailers that used to fill the ‘variety store’ category on the high street; Marks and Spencer, C & A, Woolworth’s and BHS. Soon it appears that Marks and Spencer will be the only ‘variety store’ left. Even M & S is having issues, despite significantly changing its offer to consumers.
What is clear is that BHS has not changed to meet the modern retail environment and although it may have innovated some of its product lines, it has completely failed to innovate its brand offer.
BHS was late in developing its internet shopping offer; its stores retained the image from the 1980’s so appeared old-fashioned and out of date; Its product lines, particularly clothing, didn’t react to changing customer tastes; products didn’t have the image of quality held by M & S or the disposable fashion appeal of stores like H & M; and BHS seems unable to match the speed of product development of all these firms. The company had a ‘dinosaur’ image.
It can be stated that a business which fails to innovate its brand, has no brand. BHS is like an aging oil tanker which has been set on a course and no navigational adjustments have been made to amend that course. Super-tankers and other large ships take many miles to turn around. They are steered by regular incremental changes in direction. SS BHS has not had those changes applied and the current owners have been trying to turn round the ship only when the rocks have come into sight.
Brand Innovation is important for luxury brands and discounters alike. Brands such as Apple, which follows a premium pricing strategy, need to maintain brand innovation to ensure that premium. Discount brands like EasyJet would not exist if they had not innovated the marketing model of airlines. At both ends of the market this innovation activity is constant and ongoing. BHS set its brand model decades ago and it has not changed. It is necessary to innovate your brand to retain your edge, your USP, your competitive advantage.
Developing a brand isn’t just about creating a name; it is about defining the characteristics of that brand. Brand innovation is about ensuring that those characteristics; the brands attributes and values; are fit for the current market environment.