When Brands Lose Meaning… Ford to Send Mercury to the Graveyard

The telling sign of yet another automotive brand signals the importance of having a differentiated and relevant position in the marketplace. The economic times we live in have forced Ford to terminate the Mercury brand.  But if you think about it, the Mercury brand didn’t really have a clear meaning and wasn’t differentiated from competition. Keith Naughton of Bloomberg writes about the end of the Mercury brand after seven decades.

There are many factors that enable one brand to succeed and another to dwindle. Product quality, styling, distribution, service, etc. But what Mercury suffered from is not having a clear consumer reason for existing. In fact, this may be the most important issue facing brands today.

Originally, Mercury was Ford’s response to General Motors proliferation of brands in the late 1930’s. The once market leader Ford, rapidly became #2 because of the sheer number of brands that GM introduced; Chevrolet, Oldsmobile, Buick, Pontiac and Cadillac. So Ford determined that Mercury would be a mid-priced entry, above the Ford brand, and below Lincoln.

While this made sense at the time, in today’s more sophisticated marketplaces, having multiple brands can be costly and create confusion. Today, for a brand to be a leader, it must have a clear reason for being, be relevant and address consumer needs, be differentiated in the minds of its consumers, be defined by a compelling brand idea, and have a strategy for gaining awareness. The days of traditional advertising driving sales are over, and now there are multiple channels, including social media, that are critical to gain not only awareness, but also relevancy. Brands that don’t have these characteristics have a difficult time to survive. Brands that do can charge more and earn more attractive margins.

The Mercury brand, often referred to by its “hockey sticks” logo, just didn’t have a reason to exist. While we will mourn Mercury, this pruning of product lines will ultimately make Ford more competitive.

Think about how many brands have fallen prey to this lack of a reason for being and are now part of the pantheon of nostalgia. Plymouth, Pontiac, Saturn, Oldsmobile and on and on. For one, I will miss them.