Why Most Brands Die

Mark Di SommaApril 25, 20142 min

No matter how successful your brand is now, it will probably die. That’s the forecast from Jim Collins in this insightful article about life and death on the Fortune 500. In it he points out that over 2000 companies have appeared on the list since its inception in 1955. But of the 500 that appeared on that first list, only 71 are still going at the time he is writing (2008). That’s an 86% disappearance rate.

Collins’ key point is that making the list actually means nothing, because getting there says nothing, and guarantees nothing, about your ability to survive. Some of the companies that loom large now weren’t even around in 1955 – e.g. all the technology companies – and some, which were lauded and celebrated then, including Scott Paper, Zenith, Rubbermaid, Teledyne, Warner Lambert and Bethlehem Steel are nowhere to be found.

Thirty years ago, Ames Department Stores and Wal-Mart had the same business model and were flourishing. Today, Ames is gone and Wal-Mart is ranked number one.

Near the end of his piece, Collins observes “all products, services, markets, and even specific solutions to social problems eventually become obsolete. But that does not mean that the organizations and societies that produce them must themselves become obsolete and irrelevant.”

Life moves on. A lot of brands don’t. Remember this: If you tie who you are to what you do and where you operate, you’re a funeral waiting to happen. Your organization must be about more than those things if you are to survive. The history lesson is that many didn’t think beyond what they did, and as a result they don’t exist now. That’s the price of redundant excellence.

Will your company still be around in 60 years?

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Mark Di Somma

4 comments

  • Hilton Barbour

    April 26, 2014 at 5:40 am

    Look at the folks who were able to genuinely transform. IBM moving from hardware to services. Nokia from industrial boots to telecommunications. Theodore Levitt said it best…”Are You in the railroad business or the business of transporting people”

    Thanks for the great reminder Mark.

  • Mark Disomma

    April 26, 2014 at 3:03 pm

    Thanks Hilton. Is it more than a coincidence I wonder that the number of brands that are distinctive (just 1 in 5 according to Nigel Hollis) and the number of brands that survive and succeed over the long term that Collins quotes (14%) are roughly in the same ballpark. IBM pulled off the “purple cow” not once, but twice. Remarkable. So it can be done and the rewards can be significant and long-lasting, but it’s certainly not easy. Love the Levitt question …

  • Serge

    April 27, 2014 at 6:59 pm

    Great insight and interesting stats!

    I share your point that companies should do more than they think they can. Moreover, sometimes it’s even useful to set purposes that seem a bit unreachable. While trying to reach those, you’ll definitely reach at least that minimum to stay on top for the next 60 years.

  • Gary Steele

    March 12, 2017 at 9:18 am

    It is hard to argue with continued innovation, evolution and acceptance of new technologies to stay a Fortune 500 company. Much has changed since 1955 and to your point “most” companies were not able to weather that evolution. Similarly the DOW component of the NYSE has also changed dramatically over that time to reflect these changes in technology and business.

    That being said as a marketer I take issue with the title of your article “Why most BRANDS die” vs. the content which is company not brand based. It is true that all of the companies you name, save Rubbermaid whose name is still apparent after the Newell acquisition, do no longer exist. But many of the brands that were created still exist. Listerine, Scott paper products, Rubbermaid, Waterpik, etc. have avoided the fate of the companies that originally brought them to market.

    I still believe in the power and value of brands and wanted to call out the difference with respect to your article. More focus by Fortune 500 companies on their “Corporate” brand and less protection of the products/services they sell in their quest for short term gains might be a useful conversation? Apple, IBM and Disney are great examples of Companies as brands which offer a more macro benefit to their customers than simply the products on the shelf.

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