Ubiquitous 20th Century Brands That Will Disappear

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Several brands which were extremely powerful during the last few decades are about to disappear. Many of them no longer drive big sales. Some are a part of companies that are in trouble. Some are part of industries which are falling apart.

Big brands disappear all the time. Sometimes we simply miss their passing. Cingular Wireless was on most Top 100 brands lists. Once AT&T (T) took over BellSouth, it dropped Cingular completely. Compaq was one of the most visible PC brands in the world. It began to fade away after it was bought by Hewlett-Packard (HPQ). The IBM PC brand, one of the original PC brands, no longer exists since it was acquired by Lenovo, a Chinese company, several years ago.

Here is a list of brands, most over them a decade old, and some much older, which are likely to go away in the next year or two.

XM Satellite Radio (NASDAQ: XMSR) will disappear either in a merger with Sirius (NASDAQ: SIRI) the acquiring company will use its brand for both services or because without a merger XM may not make it. The company has over $1.2 billion in long-term debt. XM has always been the service with the largest number of subscribers. The XM brand could begin to disappear a few months after the potential marriage is complete.

E*Trade (NASDAQ: ETFC) has survived in a discount brokerage business where a number of famous brands, like Quick & Reilly, have gone away because of mergers. For the time being, management at the company says it does not want to sell out, but the firm’s $12 billion in home equity loan exposure may make staying independent impossible. The most likely buyers of E*Trade would be TDAmeritrade (NASDAQ:AMTD) and Schwab (NASDAQ: SCHW). It would be ironic if a discount broker brand disappears because it was scuttled by its mortgage business but the housing crisis does things like that.

K-Mart is one of the two big brands at Sears Holdings (NASDAQ: SHLD), Eddie Lampert’s failing retail play. Based on same store sales for last year, K-Mart is the less successful of the two retail operations. Spending to promote K-Mart and Sears may cost more that the holding company can afford. It certainly makes sense to kill off the K-Mart name and re-label all of the stores with Sears. It could save hundreds of millions in promotion dollars every year.

Dodge is part of the Chrysler company which was recently bought out by private equity firm Cerberus. Chrysler management has already said that the company has too many brands and too many dealers. It is trying to cope with a vicious downturn in the US auto market. Keeping a car brand means huge advertising and marketing costs and product development. Dodge vehicles will probably be re-branded as Chrysler and Dodge will go the way of the Dodo.

Circuit City (NYSE: CC) has been synonymous with electronics retail, but companies like Best Buy (NYSE: BBY) and Wal-Mart (NYSE: WMT) have brought too much marketing muscle and wholesale buying power to the industry. Outside investors are already circling Circuit City trying to "improve shareholder value". That means that there is a good chance the chain will be sold. The price of the company’s shares has already dropped from over $30 less than two years ago to just over $4. Best Buy could be the most logical buyer by keeping the locations that do well and closing the rest. Virtually all the merchandising, management, and public company costs would go away as would the Circuit City brand.

Gateway was recently bought by Taiwan PC firm Acer. Some investors may not remember when Gateway was considered a peer of both Dell (NASDAQ: DELL) and Compaq. In 1993, Gateway was in the Fortune 500.  Acer will not keep the Gateway brand and its own. The dual promotion costs are too high. Starting soon you will be buying an Acer PC online or at your electronics retailer.

Vonage (NYSE: VG) almost invented VoIP. It certainly made it popular. Then cable companies began to market the service to existing customers and much of the "first mover" advantage Vonage had went away. Patent suits from companies like Verizon (NYSE: VZ) and other big telecom companies bled away most of the cash that Vonage raised in its IPO. Two years ago, the stock was above $17. Now it trades at under $2. Vonage still loses money. One the large cable companies is likely to take over the Vonage customer list and let the brand disappear.

Yahoo! (NASDAQ: YHOO) is still trying to keep itself out of the hands of Microsoft (NASDAQ: MSFT), but with a $31 offer and no other bidders even close, Redmond is going to take over. Microsoft is not generous about letting other brands have the limelight. Yahoo!’s brand will last while the e-mail and instant message operations are integrated, but soon enough it will all be MSN.

Old Navy is one of Gap’s (NYSE: GPS) three brands and it is the one that is pulling down overall sales at the big clothing company. Old Navy has a little over one thousand outlets. Maintaining the costs of separate buying, marketing, and management costs just isn’t worth it. Soon, the Old Navy stores will just be Gaps.

Countrywide (NYSE: CFC) had an operation on almost every street corner, or so it seemed. The mortgage bank would give almost anyone a home loan.They were not so generous when foreclosure time came around. Bank of America (NYSE: BAC) is buying Countrywide. The CFC brand has so much negative baggage and such a poor image that BAC will be smart and quickly put its name on all of the Countrywide branches.

Motorola (NYSE: MOT) is still likely to sell its large handset unit to someone. It simply loses too much money and it is dragging the company under, As Motorola’s stock price drops, the amount it will take for its handset operation will drop. LG, Sony Ericsson, or Samsung are probable buyers at some price, and that price gets more affordable as Motorola’s global market share drops. That Motorola phone is likely to be called an LG handset sometime next year.

Douglas A. McIntyre 

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