Polaroid, Sharper Image: Some brands live again
Some bankrupt brands never die — and they don’t fade away either.
That’s why consumers this holiday season will still see Sharper Image products, Linens n’ Things retail outlets, Polaroid cameras, and scores of other familiar names even after the original companies went broke.
Brand names are sold like any other asset, and during the recession — as more companies sink — more businesses are feeding off their remains.
“The buying of old brands has always been with us, it’s just that there are more being put out to pasture now, and there have been a lot of firesales,” said Eli Portnoy, a branding expert and CEO of the Portnoy Group.
Jamie Salter, CEO of Hilco Consumer Capital, which buys brands, thought Polaroid would be out of reach with a price tag in the hundreds of millions of dollars.
The busted company, however, sold the name for a song, he said: $65 million.
“There are no negatives on that company,” Salter said. “There is more love around it than any other company I have ever seen.”
Portnoy calls known brands “cash cows,” because they come with instant consumer awareness, generate revenue and require little marketing.
Sharper Image shut down its stores last year, but under the new owners — Hilco is a partner — products will hit stores carrying the Sharper Image name.
The revived brand could make more money than before because its products will be in more stores and it no longer has to fund research and development, said Federico de Bellegarde, vice president of licensing at the Sharper Image.
“The brand was worth more than annual sales [at stores] because the name is known in the American lexicon,” he said.
Q&A with branding expert Eli Portnoy
Why do companies revive brands?
It’s a smart business move for investors who want to make some money and take dying brands and give them new life, and generate revenue by spending the least amount of marketing dollars.
What are the pitfalls of reviving a brand?
Don’t go against what the core brand was all about. If it isn’t consistent with what people remember, it will fail.
What brands should not be brought back?
[Brands that are associated with fatalities, such as the airline ValuJet] It’s one thing to lose money, it’s another for people to die. Brands that make people die have a hard time resuscitating.