AOL Unplugged

Carly Fiorina's time at Hewlett Packard and LouisI rushed to visit a relative in intensive care, and I was
Gerstner time at IBM proved that decentralizednot happy to see her hooked-up to a number of HP
management of product lines in a large company ismedical monitoring devices. The weakened MPE brand
the only sane management strategy.created in me a negative prejudice for their medical
Lou took an ailing and heavily centralized IBM, andproducts.
saved it from extinction by decentralizing its productIn web properties - where the subject matters
categories. Carly took a healthy, decentralized HP andpresented on a web site may be audience specific
tried to kill it through heavy centralization.(say teenage boys vs. geriatric women) -
Now AOL, the perennial poster child fordecentralized branding is essential. Contrary to
developmentally disabled technology, has seen thecommon belief, segregating the brands does not
light and is decentralizing (while some of theireliminate potential synergies.
executives face jail time).Take (formerly VA Software) who has a number of
AOL - which lost the ISP wars by failing to add valuetechnology industry web sites, on which they sell a
in broadband, and whose Time Warner appendageton of advertising. They reap significant synergies
lost the portal wars by failing to provide appetizingfrom different web properties that have at best
content - is now decentralizing their contentsporadic cross traffic. The branding needs for their IT
components to the point of debranding - jettisoningmanager's web site is very different than their Linux
the AOL name. Given the tarnished AOL brandjunkie web site.
image, debranding their targeted web properties isTake two of AOLs newly branded properties -
essential lest the fractured pieces of the empireAsylum, a site for young men, and WalletPop, a site
carry the lingering stench of failure.devoted to personal finance (a topic with which
AOL is creating new - and re-branding old - webyoung men are largely unfamiliar). Pulling both of
properties that are largely devoid of any referencethose under the torn AOL umbrella would do neither
to the centralized AOL moniker. By making each webproperty any favors. But allow each to tailor the
property (product) a separately branded entity, eachentire brand to their members is favorable ... and thus
site can create its own identity and appeal to highlysmart.
targeted markets. This amplifies the appeal of each,The marketing issue here is multifaceted. First, you
making the properties stronger.must decide if there is any real cross-over between
(This is a lesson Yahoo may take to heart -the product areas. If so, a unified brand might do you
weakness in one business may create a weak brandsome good. If there is no cross-over, then odds are
image for all other components. Hence Yahoo'sthe unified branding will not help in the slightest and
reluctance to be acquired by Microsoft lest Yahoomay actually hurt.
products suffer even more brand debasement.)Second, does the parent brand offer any specific
Herein is where branding in large organizations isadvantage? HP has a strong overall technology brand,
problematic. If one or more products/divisions areand it generally helps all of their product categories.
strong, there is the potential for that brand strengthAOL does not, and thus the AOL brand may hurt the
to carry into the other divisions. For example, HP'sindividual web products.
strength in printers has led many people to buy theirFinally, top management has to have the strength to
often unreliable laptops.let go. Decentralizing and allowing subordinates make
But the reverse is true. I used to manage large HPboth strategic and tactical decisions about the
data centers, and had problems with their proprietarydecentralized products and brands takes guts. But
MPE operating system - for a while it crashed toothe bigger and more diverse your company is, the
frequently for mission-critical work. During that periodmore important decentralising will become.