When Large Companies Buy Small Brands — Buy and Hide or Buy and Show

As the market fragments into countless niches and communication channels, practitioners must regularly test the conventional logic of brand communications and marketing. There will also be odd or unlikely company marriages and buy-outs.

Take basketball shoemaker Converse. Manufactured since 1908, the shoe company has made a comeback in recent years. Described as a leader in the “vegetarian” shoe category, the product is typically purchased by those who call themselves environmentalists and those who use their purchasing power to object to the labor and environmental practices of large shoe makers (e.g., Nike), among others.

Consumers may believe that they are buying Converse to avoid Nike, but ultimately their purchase affects Nike’s bottom line. It’s a little known fact that Nike owns Converse.

Few official press releases about Nike’s purchase of Converse exist. A quick search on Nike.com yields nothing for “Converse shoes.” A quick search on Converse.com for “Nike”—no results.

Converse is a “Swoosh-free” brand. This is a case of buy and hide.

While Nike has leveraged the strength of Converse, neither brand mentions the other in marketing and customer communications. The dis-synergy between the two brands is evident and planned. There’s a greater downside if the connection is touted than if customers simply discover the information.

When the dowdy Sears took over the preppy Lands End, the brand communication and marketing touted the new business relationship. Sears took the buy and show approach. Sears devoted floor space to Lands End products and clothing and focused on serving the multi-channel customer. Lands End clothes is feature on Sears.com, but not vice versa.

While both stocks moved up on the news, customers reacted negatively. Sears sells appliances and not so good clothing. Lands End sells high quality, durable clothing and had superior customer service.

Did Sears buy Lands End to improve its brand image or to offer the customer better quality clothes, or both? Was Lands End’s brand image diluted from its new association with a company that was just a notch above K-mart?
These are important questions.

As the marketplace changes, there will be evidence of both models…buy and hide and buy and show. Because the brand experience is so pervasive, marketers must ensure that the brand communication decisions support the long-term business strategies, as well as consistently evaluate the nuances of the customer’s brand experience.