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For the love of chocolate…

October 12, 2011

A while back Gemma and I were having a chat about brands that we really wanted to work on.

One of mine was Waterstones.

Another is Thorntons.  (If you couldn’t tell I was British, my obvious love of a good underdog should be making that abundantly apparent now).

(Picture creds to The Telegraph)

Thorntons is one of those brands that feels like it should be a much-loved high street institution.

And, in these recessionary times, it should also be one of the few brands that it doing alright for itself – after all ‘The Lipstick Effect’ could just as easily have been called ‘The Chocolate Effect’; it’s another small luxury that makes you feel a bit happier.

After a bad 2010-2011, the brand has had a miserable first quarter, with sales down 7.6% to £46.5m.

I’m not the first person to notice that the brand seems to have lost its way a little (this commentary from Tim Richardson is an interesting start point) and I’m sure I won’t be the last.  But the ways that they are approaching a turnaround seem odd, considering the problems that they are facing…

1. The times, they are a-changing 

The first thing that strikes me about what is happening to Thorntons at the moment is that they don’t seem to know what their niche is in the market today.

They lead with the line ‘the art of the chocolatier’ but if it came down to real ‘art’ in chocolate surely the beautifully chic Hotel Chocolat would win hands down on this positioning with most people?

In fact, I’d hazard a guess that most people would probably attribute this strap-line to someone like Lindt, citing the old ‘chocolate heaven since 1911’ line as still being what Thorntons use.

I wish it was.  There’s something in ‘chocolate heaven’ that is far more appealing – conjuring up images of old-fashioned glass jars of sweets, and Willy Wonka, and the excitement and joy of genuinely being a kid in a sweet shop that is missing from their personality at the moment.  That’s something that I believe only Thornton’s can own, because of their heritage. It seems a little lost at the moment though.

2. Confusing your customers (and the curse of deep discounting)

“Our consumers remain cost-conscious and continue to select promoted products” says Jonathan Hart.  I wonder whether this is less about a reluctance to spend more on a little luxury, and more about the fact that you know the same box of chocolates is always on sale, 50% off, in Asda.  Why would you pay full price?

There’s that old saying, “once is a mistake, twice is a coincidence”.  People generally like order and patterns; things that they can use to make sense of the world.  But when the brand is devalued in this way it forms a pattern that goes against the idea that it can be premium or something special.

Which is why it’s perhaps a bit worrying that the new strategy focuses on expanding commercial sales to supermarkets.  While it makes sense in the short-term, this makes it harder to form a clear picture of the role that the brand has in people’s repertoire.  While it is probably too idealistic to say ‘pull out of the supermarkets completely’ surely there is a better way to help maintain (or regain) the brand’s equity?

3. Losing control of your brand experience

This is the one thing that I really can’t understand.

Chocolate is a product that lies in the experience – the smell, the taste, the texture.  Pictures of chocolate are all well and good – but temptation really strikes when you can smell and see it.

And if you are having a problem that is mainly caused by the fact that people don’t understand the role that your brand should play in their life, why would you relinquish control of the one place that you can really influence how they perceive you?

Last month the Grocer reported that part of the new strategy relies on closing more of the high street stores, and finding franchisees to take on responsibility instead.  My concern is that this will make the problem worse.  The stores are the place where the brand can define what it stands for – creating an experience that will help people to believe in the brand again, to realise why they should pay full price, and the place that explains just how they are different to everyone else.

I can see the long-term sense in closing down the shops – they are a fixed cost that it is (relatively) easy to be rid of.  But is the cost of supporting them a cause of the brands decline, or just a symptom of it?

That is really my sadness with this news.  I know I’m not privy to the full details, and I know that cleverer minds than mine have been working on these problems. But it does feel like they aren’t treating the cause of the problem, just the symptoms of what is happening. And it would be a real shame if this brand left the high-street after 100 years of delivering happiness to people.

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