For a long time, Fortune Brands served as an excellent example of a “House of Brands” – a company with no rhyme or reason from a marketing perspective. Fortune was a company with well-known but disparate brands like Titleist, Moen, and Jim Beam.
Wall Street typically hates mashed-up conglomerates as much as good brand strategists do. They hated Fortune Brands. After severe hounding by activist investor/hedge fund manager Bill Ackman, Fortune sold the golf-related businesses and created a new company for the spirits side of the “house.”
And, for what it’s worth, Fortune Brands is STILL a classic house of brands. The newly and imaginatively named “Fortune Brands Home & Security” includes classics like Moen (obviously), Kitchen Craft and Master Lock. Nothing named “Fortune.”
But this story is about Jim Beam, and how, from both investor and marketer points of view, being on its own would let it achieve its full potential.
In theory at least.
You see, even though it renamed its business within Fortune Brands as, simply, Beam Worldwide way back in 2006, this wasn’t going to be a “Jim Beam-only” story.
Back then, Beam Worldwide was buying up companies left and right, across the entire spirits spectrum, among them Courvoisier, Maker’s Mark, Teachers, Cruzan (rum) and EFFEN (vodka).
As a stand-alone company, now Beam Inc., the acquisitions continue. Two weeks ago Beam announced it would add ANOTHER two brands – Pinnacle vodka and Calico Jack rum.
So, here we are again. Beam has become a house of brands. On steroids.
Should we hate it as much as we hated Fortune Brands? No.
Beam Inc. is laser focused on the categories it should be in (and knows where it shouldn’t be, selling off its wine business years ago). The many Beam brands might not have any direct synergies – for example, EFFEN marketing programs aren’t going to help Courvoisier’s sales one lick (!!!) – but the marketing best practices, passion, and operations can be leveraged across the entire portfolio.
This is a house of brands that will indeed be greater than the sum of its parts. So much so that today we add it to the Lairig Marketing Index.
Late as usual. BEAM has already run straight up 50% since its October “relaunch.” (And we are down already 0.5% for today, due to the stock market’s once-a-week “Greek spasm.”) But that shows how confident we are.