Woolies brand loses its sparkle

Vlad Georgescu Business reporter, BBC News

Woolworths' brand has declined in the past decades

What's in a name? Well, there could be millions of dollars if the name is Nokia, Nike, Google or Amazon. However, if the name is Woolworths, the answer gets a bit more complicated.

Beyond selling Woolies' considerable assets, the troubled retailer's administrators are asking themselves if money could be made on the iconic brand, which had ruled the High Street for decades.

There is no doubt that Woolies' name can still bring a tear to the shopper's eyes.

For almost 100 years it has offered everything for house and home, from kitchenware and tools, to haberdashery and toys.

Generations of teenagers popped in for CDs and some "pic 'n' mix" toffees on their way out.

However, nostalgia might not be enough to sell a brand which, in the past, had identified itself by value, convenience and reliability.

Brand appeal

The Woolworths brand has lots of awareness and an increased level of affection Giles Lury brand consultant, The Value Engineers

To assess a brand's value is no easy mission.

The YouGov Brandindex poll includes questions regarding general impression, quality, value, corporate image or customer satisfaction.

And the index has shown a constant decline for the Woolworths brand in the past few years.

The name attracted positive views from 70% of the people, while Argos, WH Smith or Boots scored well above 85%.

Giles Lury, brand consultant at The Value Engineers, believes that Woolworths' business model lacked clarity and vision, and this had an immediate impact on its brand.

"Woolworths had a great role as a generalist. But a lot of their market area moved to other suppliers. It tried to be a jack-of-all trades, but it lost out to those who were masters of one," he says.

No 'buzz'

Woolies was left with no answers when faced with stiff competition from supermarkets and internet retailers, adds Amy Frengley, senior consultant at Brandsmiths.

"Its original demographic has become much more sophisticated. Certainly they have new expectations, shaped in part by other retailers, as to what a store like Woolies should be delivering even within the parameters of a low-price retailer".

in 1930s, Woolworths took the British High Street by storm

Woolies' brand was also undermined by the lack of what Brandindex calls "buzz" - the customer's excitement towards a company or a product.

This is the area where much younger online retailers, such as search engines Google and Yahoo or image-focused companies like Nike or Adidas, are stronger.

The 99-year-old retailer simply forgot to reinvent itself.

When it had realised that a major crisis had been engulfing its brand, it was already too late.

However, brand consultant Giles Lury says that, despite lacking in relevance and dynamism, the Woolies brand is still a valuable commodity.

"It has lots of awareness and an increased level of affection. Someone could go out and buy it just for its level of familiarity," he says.

"But they will have a massive task on their hands. Whoever buys it will need to rejuvenate the brand and re-launch it, to make it appealing for the 21st Century."

Uncertain future

Woolies' name could disappear from the High Street if the brand is not saved

But how much is the Woolworths' name worth now?

Analysts say it could go for as low as one pound, or it could achieve a significantly higher amount if investors willing to turn the brand around get involved in the administration process.

So far, just Theo Paphitis, the Dragons' Den entrepreneur, has expressed a direct interest in the Woolies name.

But he pulled out of the race to buy parts of the ailing retailer after failing to reach a deal with the administrators.

The future for the Woolworths' name seems uncertain.

With no investor in sight, there is a good chance it may end up like Polaroid or Oldsmobile, other iconic names of the 20th Century which were unable to keep up with the times.

"The only way it could become a successful global brand is by finding something new, different and interesting to say about itself that capitalises on the positives of its past - such as trust, reliability, local - but isn't constrained by it," says brand consultant Amy Frengley.

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