The sad demise of famous retail brands over recent years has shone a light on the relative value of the assets of a business. With the likes of Paperchase, Made.com, Top Shop & Debenhams amongst those looking for buyers the split between those investors interested in brand assets and those interested in physical assets such as product, property and the workforce, has been quite startling.
Clearly for many it is the brand asset that is worth most. Next has bought up the Made & Joules names, Tesco acquired the famous Paperchase brand, whilst ASOS & Boohoo bought the rights to TopShop and Debenhams.
Probably not surprisingly for pureplay businesses, retail property was not an interest for ASOS & Boohoo. Of more interest is that property was not an interest for Tesco or Next either, and more noteworthy than that, was also the lack of interest in any remaining inventory and in the people who had helped to design it & buy it in the first place.
In many ways this reflects a market where product assortment in many cases has been relegated to nothing much more a commodity. Something with minimal creativity and innovation, widely available for whatever margin your economies of scale can negotiate. For businesses the size of Next & Tesco it makes no sense to complicate their supply chains and dilute their ability to pay the least for the most.
However the danger of investing only in the brand is to ignore the fact that brands have been formed and created by people and by the products, shops, marketing and customer relationships those people nurtured and evolved. Take away those inspirational and influencial people and it will not take long for a brand name to tarnish, soon to be tossed onto the scrapheap of intellectual bankruptcy, squeezed dry of its remaining value..
Fail to invest in people and your brand and your revenue will disappear. Realise that your biggest asset are your people. Cherish them, nurture them, and see them grow in every corner, in every location, where your retail brand has a physical or digital presence.
The fact is that modern brands no longer just rely on anonymous people who design and manage physical shops, who buy and merchandise physical products as the touchpoints of the brand with the customer. Now retail businesses must be totally transparent to the customer, and everyone from founders, owners, colleagues, shopkeepers, shop workers, suppliers, manufacturers and of course the customers themselves are now part of the living breathing brand that is seen and experienced by the wider world.
Amazing brands are full of extraordinary people. Smart businesses invest in their growth as a brand asset with a high ROI. They help and fund them to grow as retail professionals, acquiring new skills and confidence, but they also encourage and support them to grow as individuals, through community involvement, charity work, doing extraordinary and inspiring things that reflect positively on the brand that employs them.
People are the new brand advocates. They are real, they are honest & genuine and they are trusted by the customer. They are the public face, and they provide the brand content of websites, blogs, social media, marketing, advertising, shop floors, till points, call centres, and delivery drivers.
Their influence extends up and down every supply chain. They are your vertically integrated brand asset.
The separation of traditional assets between the ‘brand identity’ and the physical shops and products makes sense for any investor with different priorities. Those that want to add well-known brand names to their existing portfolios, those whose businesses are about buying up liquidated stock and distributing it to secondary points of sale.
But the warning is there to those that separate a brand identity, a logo, fonts and colour paletes, from the real life & blood of a living brand, its people.
It is a lesson for all existing and successful retail brands. Your brand is your people, and in a world that seemingly values brand above products, then people are clearly your most valuable asset.