advanced theory and practice in sport marketing - Marshalls University

GLOBAL PRODUCT MANAGEMENT:
THE RISE, FALL, AND REBIRTH OF DUNLOP
The Dunlop sports brand is more than just a textbook example of brand
diversification – it also highlights the risks and benefits of licensing.
The Dunlop trademark grew from a humble tire brand into one of the
world’s most established sports brands. The revenues from the flourishing
tire business and the expertise in rubber-based manufacturing at the beginning
of the last century created a new challenge for the Dunlop brand – how
could it broaden its activities by leveraging its expertise?
Rubber was used in hoses, pipes, belts, tennis balls, and golf balls, and over
time Dunlop developed world-class business units in each of these categories.
The sports ball business turned into a global sports business, which enjoyed
an unrivalled international status. Throughout the 20th century, Dunlop was
the most successful sports brand. The world’s best golfers, including Arnold
Palmer, used and promoted Dunlop equipment. By the 1980s, high-profile
stars such as John McEnroe and Virginia Wade used Dunlop tennis racquets
and, naturally, the company’s global reputation was at an all-time high.
In 1985, the Dunlop business was divided up and BTR (now Invensys)
bought its sports arm. However, despite steady licensing revenue the sports
brand itself was neglected. According to Phil Parnell, then CEO:
… the company stopped investing in players and operating at grass-roots level. It
took 100 years to build the brand and 15 years to abandon most of the marketing
support behind it.
In 1996, a private equity group purchased the company. The problem of
rejuvenating the brand was exacerbated by serious financial issues – debt and
cash-flow problems were damaging the brand and crippling the business.
The key process for the business was to reestablish the credibility of the
brand through the technical excellence of the products, and to highlight the
consumer benefits that the purchaser of each product enjoyed.
On the legal side, the company focused on developing cost-effective and
innovative strategies that protected valuable trademarks and existing licensing
revenues. Review and amendment of the existing documentation and renegotiation
of agreements placed greater emphasis on quality control, more frequent
audits and reporting, tighter control of licensee activity, more detailed involvement
in marketing plans, and the coordination of marketing execution.
Dunlop computerized its extensive trademark portfolio and rationalized it
through brand and trademark sales. This created greater cost control and
focus. The company appraised licensees and encouraged them to achieve
closer alignment with the Group’s product and brand values. This reemphasized
the true origin and nature of the goods and ensured that new products
fitted the brand profile, whether they were manufactured or sourced by the
Group or by its licensees. Management of the portfolio ensured that brand equity
Continued
SPORT PRODUCT MANAGEMENT 145