To hell and back

This is the best news I've heard for a long time. Callum Davies and his mates at Hell have bought back their baby. The Tasman Pacific Foods Group purchase three years ago was a disaster. It was fifteen million dollars the boys needed to take Hell to the rest of the world but they also now know that large corporates are not the best custodians of boutique brands (see my last blog). In just three years Tasman Pacific succeeded in getting seriously offside with the franchisees, they tried to lift sales by slashing costs, they showed a complete lack of understanding of what they had bought.

Fontera’s purchase of Kapiti has all the hallmarks of a similar fate. The only difference is that Fontera will know how to milk the brand dry before they destroy it’s ‘heart’.
It took Ross McCallum twenty plus years to create Kapiti (Callum has worked in Hell for a similar time period). Brand bashing corporates can bleed delicate brands dry in only a couple of years.

Lane Walker Rudkin has gone down the toilet along a frightening number of other one hundred plus year old companies in the last few years. These iconic brands are worth fortunes and large corporates are seriously mismanaging the brand equity that has been built up over years of investment, toil and sweat. It is a form of asset stripping gone mad. It is also at the crux of this so called global recession. Mass destruction of trust, value and quality.
I’m sure businesses would protect their investment if they knew how but the problem highlights the fact that major companies, their legal, financial and marketing advisers know next to nothing about brands. They think brand is something they own and bleed rather than something thay should nuture and ‘garden’.

So here is my advice to all big corporations. Watch carefully the road to Hell and learn. Callum and his team will get things back on track I know. They are very clever people. They understand the essence of a brand. They understand Hell connects with franchisees and customers alike. They understand that Hell is more than fast food. They treat it with care, they love it to bits and they will stay with the game plan.

Callum's road to Hell has always been paved with good intentions. He now sits on a well deserved wad of cash in his back pocket after buying back the franchise for a fraction of the original sale price but a devil of a job in front of him.

Bring on the resurrection.

Let's play telephone tag

Just because you are the biggest doesn’t mean you’re the best.
In fact market leadership until recently has often occurred by default. Big organisations, first to market gain a size and momentum that is almost impossible to stop. Telecom, Vodafone, ANZ, BNZ and TVNZ are good examples. With their market dominance often comes market arrogance, what I call ‘business chauvinism’.
These businesses are often run by accountants and financiers who know the cost of everything and the value of nothing. They become skilled at the end game of economic chess to a point where winning (or making a profit) becomes their reason for being. They lose sight of what being in business is all about (looking after the customer).
Throwing your weight around is no longer a valid strategy for maintaining leadership (as the American auto industry is learning).

So when businesses such as Telecom and the ANZ decide to take their call centres offshore as a way of slashing even more costs they expose themselves to ridicule. I’m not talking about robbing New Zealanders of jobs; that’s another story in itself, I’m talking about turning an already shocking service into a farce.

Taking call centres to countries where English is a poor second language, where the people probably don’t even know where New Zealand is on the map is tantamount to telling customers “we’d rather you didn’t call at all. You won’t understand a word we are saying and we have no idea who you are or where you live anyway.”

The phone is the front gate for many of these businesses and ‘dumbing down’ the service to save costs will come back to bite them in their rears big time. The only good news is that it opens the door to competitors who understand that delighting customers is the key to business success. Energy, telecommunications and banking services have become commodities because the big businesses that dominate these sectors haven’t figured out that they could add value (answer phones quickly and intelligently) and make even more money.

But hold the phone folks. AXA is out of the blocks with an advertising campaign promising to answer the phones locally. Good on ya AXA. It appears some of the big guys can eventually figure it out