Monday, June 02, 2008

Fedex dumps Kinkos for good

Wherever I go, whenever I speak to groups, invariably the question comes up:  "So Rob, which brands do you think are doing a good job?"  In my book, The Revenge of Brand X, I have a list of brands that I happen to think are doing a swell job of branding, but the one you'll find close to the top of the list every time is Federal Express, or as they're now known, FEDEX.

I like FEDEX for a number of reasons, not the least of which is that they subscribe to my tenets of branding without even knowing who I am.  That's neat.  I like how even from the beginning, FEDEX branded themselves from the outside in.  While all their competitors were puffing about their airplanes and trucks, FEDEX focused on the one reason why overnight delivery was invented:

They covered your ass.

It's true.  While everyone else was primping for profit, FEDEX was making sure your career was safe and secure by working on your behalf, getting the package where it had to be, "absolutely, positively overnight."  Sure, they've changed their taglines over the years, but the brand strategy has always remained the same.   FEDEX even introduced their innovations smartly:  Yes, their pre-printed shipping labels cut down shippers' costs, but they also increased FEDEX's efficiencies but cutting down the amount of time it took sorters and drivers to read your handwriting.  Their shipping boxes were free, too, but that's how it looks to you because FEDEX wanted you to see the benefit.  The real story is that standardized packaging allowed FEDEX to make much more efficient use of their shipping containers.

Get the idea?  These guys are smart.  And when they acquired Kinko's, they were just as smart.

Recognizing that small and micro-businesses were a nascent, high-growth sector, they cleverly snapped up Kinko's copy and office centers in order to expand their client base.  They did it smart and they did it fast (beating United Parcel Service to the bunch, leaving UPS to acquire an anemic also-ran in the form of Mailboxes Etc.).

This week FEDEX made another smart decision:  They decided to drop the Kinko name from their operation.  And even though it's going to cost them something like $869+ million, they did it for a very good reason:  Kinko's brand sucks.

Hey, Kinko's has all the assets for which it was purchased.  Unfortunately for FEDEX, all that fixed capital came handcuffed to the developmentally disabled legion of humans known as Kinko's employees.  And before you get all politically correct on me, think about your own experiences at Kinko's.

No, let me rephrase that:  Think about all those infuriating, exercises in frustration at Kinko's.

Whether it was waiting in line too long, printing a job on the wrong paper, not knowing the simplest answers without checking with the manager, Kinko's -- a great business success story despite its people -- has a brand more aligned with incompetence than the brand strategy borne or FEDEX.  If FEDEX were more like Kinko's, their tagline would have been, "Package?  You had a package?"

I'm sure that Wall Street pundits will pummel the decision for the short term, but from where I sit, the FEDEX decision train just keeps on rolling.  And the sooner is rolls over Kinko's the better.


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