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That's not cool

Entrepreneur, June, 2002 by Chris Penttila

Your brand has left the list of must-haves and is headed toward the list of things people wouldn't be caught dead with. how do you turn it around?

It's every entrepreneur's dream: You're in the right place at the right time, and your product, service or brand takes off unexpectedly. You're the coolest thing going. Then just as suddenly, you're not. Your cool has almost run its course, and you run the risk of becoming a cautionary tale in some business text-book. So what will you do when you start losing your cool? It's an important question to ask yourself if you want to be more than just a fad.

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"The minute you're on the 'in' list, you're preparing to be on the 'out' list," says Nina Kaminer, president of Nike Communications Inc., a New York City luxury-product marketing firm with clients that include Montblanc and Jaguar. If you want more than your 15 minutes, you'll have to find a new way to leverage what you have to offer.

"Brands lose their cool when they lack the will to change, and they abandon what made them cool," says Roger Baxter, who heads the account planning group at The Richards Group, a Dallas advertising agency Here are the stories of three companies finding a way to be cool all over again.

mossimo: new success in mass appeal

In the late 1980s, Mossimo was hot. Some touted the boutique sportswear brand as the next Armani. But in the 1990s, it was overshadowed by Tommy Hilfiger and Gap. By 2000, the company faced distribution problems and bankruptcy. What it needed was a new strategy "When you hit a funny place in the road, you'd better find another road or you're dead. So that's what I did," says Mossimo Giannulli, founder, chairman and creative director of Mossimo Inc.

That new road is a three-year exclusive licensing agreement with Target estimated to be worth about $1 billion. Mossimo licenses its name and designs, and Target handles all manufacturing, distribution and marketing. Giving up boutique chic for the profits of wider distribution has been a shot in the arm for the Santa Monica, California, company While Giannulli, won't divulge company sales figures, they "are exceeding our internal plans; that's for sure," he says. "We're extremely pleased."

Appealing to a wider audience isn't without risk, however. "Sometimes when companies try to create more of a mass market, a lot of the early adopters feel the brand is being bastardized," says Carla DeLuca, principal of Luca LLC, a marketing consulting firm in San Francisco.

Giannulli admits worrying that mass distribution through a discount-oriented retailer would diminish the brand's cachet. "I was a little concerned. I was hoping it wouldn't screw with the integrity of the brand," he says. But he was bowled over by Target's ability to market designers like Phillippe Starck and Michael Graves.

Mossimo's alliance with Target has turned out to be a stroke of business luck in an economy where fashion-conscious people are looking for hip goods at reasonable prices. The whole concept of mass market is changing anyway as large retailers gravitate toward previously elite designer brands that help them establish a unique niche in the marketplace, says Maureen Smullen, president and creative director of Smullen Design, a marketing firm in Pasadena, California, that has worked with large retailers including Target. These days, "there's nothing wrong with being mass-marketed," she contends, adding that large retailers avoid the phrase now." 'Mass' is not a word they use anymore. They don't like it because of what it used to imply--cheap, uninteresting and not well-made--and that's not necessarily the case anymore."

Giannulli thinks that creating fun fashion at a fair price has made Mossimo a cooler brand. "We're able to do so much more product and get to so many more kids who can afford it now," he says. "I think that's really cool."

The biggest challenge in making a decision like this is to decide what you want as an entrepreneur. "Do you want your business to be a million dollars a year?" asks Giannulli. "Then that's really cool. If you want a billion-dollar brand, then there's another way to get cool. It's all in the eyes of the leader of the company."

razor usa: scooting on while you're hot

Reinventing your company or product is another way to regain your cool. Consider Madonna, who constantly reinvents herself to get attention. Along the way it's given her longevity in a tough business. Reinvention is especially important if your product isn't multidimensional. "There's not a lot you can build on to a pet rock," Smullen says.

Razor USA LLC had the product for the 2000 holidays with its Razor Scooter, which flew off shelves at toy and gadget stores. "The Way people responded before they even knew what it was, you knew it would be a hit," says Carlton Calvin, president of the Cerritos, California, company.

Business Services Industry

That's not cool

Entrepreneur, June, 2002 by Chris Penttila

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