New Balance Jumps the Shark

This week’s announcement that New Balance is shifting its campaign and advertising focus to a younger crowd has been met with skepticism, if not downright infuriation.

With the entrance of New Balance’s new CEO, the company is doing what resembles a 180-degree spin on strategy, with a new advertising campaign centered around the love/hate relationship people have with running.  And it’s not just people, but high schoolers – a far cry from the “boomer” and “everyday person” New Balance has built its success on.

An article in Monday’s Marketing Daily quotes Christine Madigan, director of global branding and brand management:

"We've always stood for performance and authenticity," Madigan says, "and we still stand for that 100%." But with the ambitious goal of doubling its $1.63 billion in sales in the next five years, it was time to reach out to a new audience, especially high school athletes. "Running may not be their main sport, and they may not even like it. But they know that if they want to win at basketball or lacrosse, they have to excel at running. Better running makes you a better athlete, and they know that."

For an expert’s opinion, I turned to my friend and colleague David Wolfe, esteemed (and brilliant) marketing strategist, who has championed New Balance in his best-selling books Ageless Marketing and Firms of Endearment.   With his permission, I publish our email exchange here:

To:  David Wolfe

From: Michele Miller

Date: March 25, 2008

Re:  New Balance’s New Campaign

Dear David:

Since you have been a champion of New Balance over the years, I thought I’d send this information your way.  Corporate New Balance has made a conscious decision to move completely away from the older demographic and are going for, in their words, “young runners.”  The campaign is called, “Love/Hate” – all about the love/hate relationship people have with running.

Here is an article on the new campaign:  read it here.

Here's one of the TV ads they’ve come up with:  watch here.

It just breaks my heart that this is the direction they are going in.  Just thought I’d share with someone who has given a damn about the company in the past.

Best,
Michele

-----------------------------------------------------------

To:  Michele Miller

From:  David Wolfe

Date: March 25, 2008

Re: RE: New Balance’s New Campaign

Hi, Michele,

Give me a call and I’d be happy to share my reactions.  They have committed a classic marketing error of stupendous proportion:  departing from the brand’s traditional essence.  Rarely do brands succeed in making so sharp a break with their past.  It’s like walking down the street one day, seeing your best friend and quickly learning that some brain trauma has robbed him of the personality you’ve known him by for years.  It would shake you up monstrously.  Not since the ill-fated “It’s not your father’s Oldsmobile” campaign have I seen such a display of ignorance of the psychodynamics of brand management.  Someone needs to get to Jim and Ann Davis (NB’s majority owners) before it is too late.

I posted a brief response this morning at the Dim Bulb blog:  read it here.

Guess I should do a blog posting on the issue as well.

Thanks for sending, especially the link to the commercials.  I had not seen them.

Warmest,

David

Thank God for people like David who don’t have to worry about mincing their words. (By the way, you have read his books and blog, right?  They are MUST reading for marketing in this generation!)

I fear this is going to be a disaster of gargantuan proportion for a company that I like very, very much.  Will this be another Vital Radiance episode?  Will New Balance be listening to customers and monitoring the Internet for reaction?  We can only wait and see… and hope.

Comments

[jane fraser]

Great article. Branding evokes emotion... but not for the sake of evoking emotion. And, effective branding speaks into the emotion about the product that already exists in one's heart. When a shoe is known for its ability to fit the hard to fit foot, why go with an artsy ad that could be ANY SHOE BRAND. Interesting play of words doesn't gain them points. If they are speaking of Love/Hate... perhaps it should be the hate of the pain caused by improper fitting footwear and the Love for a shoe that fits.

[Mary Schmidt]

Two fundamental questions:

1. Why does the company feel compelled to double their already mega revenues? (Companies - and our society - have got to change how we look at things. Growth for the sake of growth and doing stupid things for short-term Wall Street approval isn't good for any of us - from high-gloss CEOs to the granola cruncher tree-huggers.)

2. Did they think how they could do more with what they already have?

Companies cannot keep growing infinitely - as many have found out.

The reason the dinosaurs grew so large is that the earth was so warm - they could put all their energy into physical growth. There's a lesson in there somewhere for companies (non-competitive, conducive environment - in today's global economy, there's no such thing. Yadda, yadda...)

[Jason]

Context means everything. New Balance is not turning their backs on the older crowd. They simply want to include a more broadened demographic. Your blog states that “the company is doing what resembles a 180-degree spin on strategy”. The 180 degree spin is actually doing any marketing at all. You also state “Corporate New Balance has made a conscious decision to move completely away from the older demographic and are going for, in their words, ‘young runners.’” – There is no distinction I can see in that campaign – it seems all-inclusive, regardless of age.

New Balance has always been a running company. Does a campaign, that discusses the love/hate relationship between runners and running, really mean that the company is leaving older people out in the cold? Does it really mean that because New Balance wants to increase their sales by including younger adults, that their shoes are no longer wearable by common, everyday people?

Finally, to respond to the comment above, New Balance has no relationship with Wall Street since it’s a privately owned company. The company does not need to generate their revenues simply to make shareholders happy. Furthermore, New Balance is one of the few companies who proudly manufactures 1/4 of their shoes in the US, and is VERY GIVING to their employees and to many communities – not to mention the millions of dollars they have given to the Race for the Cure.

So, put on a pair of sneakers, go for a run, and discover what the marketing campaign is all about.

[Michele]

Jason,

Thanks very much for your insightful comments. If you are, as I guess, from New Balance Web Express, you have an inside view of the goals for New Balance. I hope that you are right, and that the company is looking to broaden their demographic (which isn't necessarily a good thing in my book, but that's another discussion) and won't neglect those that have been their core customer. I am a HUGE fan of New Balance and wouldn't wear any other fitness shoe.

Time will tell. In the meantime, thanks for joining in the discussion!

[David Wolfe]

Jason,

The new ads are not inclusive. To understand why they are not, one must reflect on how the human brain processes information. Because zillions more date come in from the senses than the conscious mind can handle, unconscious organs in the brain must reduce the flow of information to levels the conscious mind, with its limited RAM can handle. This process is called "information triage." (It's estimated that only about one-trillionth of the information landing on the surface of the eyes ever reaches consciousness -- just to give you an idea of how much visual information is kept from the conscious mind; and, there are four other senses the brain has to monitor!)

Thus, the first order of business in shaping marketing communications is to create message content that will survive information triage. And how is that done? By connecting the dots, as it were, between customers' survival scenarios and the contents of the message. More specifically, message content needs to resonate with a customer's worldview, values and needs to have strong prospects for surviving information triage.

Anyone familiar with the characteristic worldviews, values and needs of people in midlife (as richly detaile3d in the annals of adult development) will immediately see a disconnect in New Balance's new campaign and the core market that Jim Davis so assiduously courted and won over. The worldviews, values and needs reflected in the new campaign are exclusionary of NB's core market because they are those that are more characteristic of more youthful personalities.

Ironically, NB already enjoys strong acceptance in younger markets -- the result of its traditional ageless marketing that crossed generational lines. I once asked Jim Davis how he came upon the idea of ageless marketing that allowed young people to buy into the NB brand even though its most devoted following came from older ecustomers. "Just dumb luck, I guess." he told me.

Dumb like a fox, eh? Well, in any event, in pointedly targeting younger customers, NB is likely to see a fall off in brand loyalty among its critical core market. Shifting from ageless to aged-based marketing will be costly to to a much loved brand.

[Anita Campbell]

Michele,

I loved this post and the passion with which both you and David approached it.

Buying athletic shoes is overwhelming -- you feel like you need a guidebook -- and it's always been comforting to KNOW what a brand like New Balance stands for. Now I feel like I have to pick up the pieces and start learning all over again.

Anita

[JOhn]

Wow - I dont think NB has ever had this much discussion about any other NB launch. I dont see how this ad is a break from what NB stands for - namely great running shoes. The runners in most of the spots are not kids or teens. As long as NB makes great running shoes in sizes that fit they dont have to worry - time will tell about the ad campaign. NB still does not drop loads of money into pro athletes, their ad budget is still tiny in comparison to other brands - all is still right with the world.

[Nora]

I just thought you all might beinterested in how NB MArketing responded tomy letter of angst:

Subject
Why?
Consumer Response Team
Customer (Nora Lee) 03/29/2008 06:26 PM
Why are you dumping me for a younger, sexier girl? I've been good to you. I've purchased your shoes almost exclusively for over 10 years. I recommend you to friends, family. I sing your praises because you recognized that all feet are not created equal. Some of us have narrow feet and we need walking/running shoes, too.

You think you're being clever to dump us "over-the-hill" types for high school kids. Are you doing any homework on this move? WHo has more money -- a sophomore in high school or a 45+ women with her own income? Who is more loyal? A junior in high school who won't put anything on her feet that everyone else hasn't marked "COOL?" Who listens to a junior's reccomendations on products? Other juniors? Certainly not upper classmen. Who listens to my reccommendations? Well, let's see -- my husband and son, my in-laws and my parents, my sisters, brothers, and best friends. My employees. My second cousins and the lady in line in front of me.

THis move is so dumb, it makes me wonder if your new CEO isn't actually being employed by Nike, Reebok or Addidas.

Oh, and one more thing -- Hell hath no fury like a woman scorned. Especially one with access to the internet!

Their impassioned response:

Discussion Thread
Response (Consumer Response Team) 04/03/2008 02:03 PM
Dear Nora,

Thank you for your recent email to New Balance. We hope you understand that our dedication to providing the best-fitting and most innovative and technical performance products has not and will not change. We are working to expand our base of current loyal consumers such as yourself to consumers who may not have considered trying our brand in the past.

New Balance will continue to be seen in many of our usual places - through our sponsorship of the Susan G. Komen For the Cure running and walking events, at other marathon/race events across the country, as well as in Runners World, Running Times and the Running Network - both on-line and in their publications. These are all places where we have reached consumers of all ages and abilities with our brand message in the past and will continue to do so moving forward.

We greatly value you as our consumer and hope you will reconsider and keep us on your feet!

Please let us know if you have any additional questions or concerns by email or phone at 800-622-1218

Sincerely,

Sarah

[Lisa]

I sit here in awe at the comments above concerning the advertising of sneakers to a younger generation. Maybe I am missing the point of knowing when a shoe is comfortable. I know my kids look for the most stylish and most expensive shoe on the shelf. I would like to see a great shoe directed to catch my kids eye that would help them stay in balance when running, tumbling, baseball, basketball, and sometimes just running around the house. I have twin daughters who are not the most stable in a pair of sneakers due to very narrow shoes. They both want shoes that their friends have, but are not necessarily the one needed to help their feet. I think in a time when our children do not know how to get up and be fit is a perfect time to target this audience. I think if they could take the child that may have the big issues wih sneakers that hurt their feet maybe a better direction then show the end result of better balance would sell better, but high school is the place to start. As older adults we all know if the shoe fits better we will be more active and loyal, now it is time to share that same knowledge with our children to show them active does not mean pain. The unfortunate thing is to get there and I think this is in the right direction.