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The Customer Trap and Brand Destruction

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The Customer Trap

Abstract

The Customer Trap can lead to the destruction of many vital parts of a business. The power that a Mega-Customer is able to wield simply overwhelms the strategic toolkit of its supplier. As the Mega-Customer gains leverage, the producing firm loses control over its destiny and is soon nothing more than a colony serving the needs and wants of its colonial master. Once this happens, it is almost impossible to regain control. This is probably nowhere more easily seen than in the area of branding. The scope and magnitude of a deal with a Mega-Customer can quickly erode the brand equity of individual products and services. Ultimately, it will ruin the overall brand image of a company.

Nobody ever did, or ever will, escape the consequences of his choices.

—Alfred A. Montapert

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Notes

  1. 1.

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  2. 2.

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  3. 3.

    Andrea Orr, “Levi Must Work Out of Tight Fit: Wal-Mart Deal May End Slide in Revenues,” Houston Chronicle, September 18, 2003, p. 4.

  4. 4.

    Greg Johnson, “Troubles at Levi Strauss Revealed in SEC Filing,” Los Angeles Times, May 5, 2000, p. C-1.

  5. 5.

    Orr, “Levi Must Work Out of Tight Fit.”

  6. 6.

    Kim Girard, “Supply Chain Parnerships: How Levi’s Got Its Jeans into Wal-Mart,” CIO, www.cio.com/article/2439956/supply-chain-management/supply-chain-partnerships--how-levi-s-got-its-jeans-into-wal-mart.html, July 15, 2003.

  7. 7.

    Orr, “Levi Must Work Out of Tight Fit.”

  8. 8.

    Girard, “Supply Chain Partnerships.”

  9. 9.

    Katherine Bowersne, “Levi’s Hits Mass,” Women’s Wear Daily, December 9, 2003, p. 17.

  10. 10.

    Ibid.

  11. 11.

    Ibid.

  12. 12.

    E. Clark, “Changing Retail Market: Vendors Eye Discounters to Bolster Bottom Line,” Women’s Wear Daily, March 16, 2005, p.1–10.

  13. 13.

    “Fitting In: In Bow to Retailers’ New Clout, Levi Strauss Makes Alterations,” Wall Street Journal, June 17, 2004, p. A-1.

  14. 14.

    Sally Beatty, “At Levi Strauss Trouble Comes from all Angles,” The Wall Street Journal, October 10, 2003, p. B1.

  15. 15.

    Ray A. Smith, “At Levi Strauss, Dockers Are In: Rise in Sales Is Bright Spot, as Company Tries to Mend Its Jeans,” The Wall Street Journal, February 14, 2007, p. A.14.

  16. 16.

    SEC filing, “Form 10-K,” 2006, p. 14.

  17. 17.

    Levi Strauss & Co., “2007 Annual Report.”

  18. 18.

    Levi Strauss & Co., “Levi Strauss & Co. Announces Third-Quarter 2008 Financial Results (press release),” 2008.

  19. 19.

    SEC filing, “Form 10-K,” 2009, p. 12.

  20. 20.

    Michael Appel, “Levi Strauss Signature: The Birth or Demise of a Brand?” Retail Merchandiser 44, no. 5 (2004), p. 58.

  21. 21.

    Levi Strauss & Co., “2013 Annual Report: Forging the Path of Progress,” p. 3.

  22. 22.

    Kevin Kelleher, “Giving Dealers a Raw Deal,” CNNMoney.com, December 1, 2004.

  23. 23.

    Goodyear, “Corporate History by Year,” www.goodyear.com/corporate/history/history_byyear.html , March 4, 2015.

  24. 24.

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  25. 25.

    Jonathan J. Bean, Beyond the Broker State: Federal Policies toward Small Business, 1936–1961, (Chapel Hill, NC: The University of North Carolina Press, 1996).

  26. 26.

    Kelleher, “Giving Dealers a Raw Deal.”

  27. 27.

    Zachary Schiller, “Goodyear’s Miracle Man?” Business Week, June 17, 1991, www.bloomberg.com/bw/stories/1991-06-16/goodyears-miracle-man. accessed March 3, 2015.

  28. 28.

    Kelleher, “Giving Dealers a Raw Deal.”

  29. 29.

    “Goodyear to Sell Tires at 350 Montgomery Ward & Co. Outlets,” The Wall Street Journal, June 14, 1995, p. A6.

  30. 30.

    Dana Milbank, “Independent Goodyear Dealers Rebel: Decision to Sell through Sears Proves Unpopular,” The Wall Street Journal, July 8, 1992, p. B2.

  31. 31.

    Lloyd Stoyer, “A Juggling Act: Dealer/Supplier Relationships Take Work as Other Parties Look Out for Their Own Best Interests,” Modern Tire Dealer, April 1998, http://www.moderntiredealer.com/article/story/2008/04/a-juggling-act.aspx . accessed March 3, 2015.

  32. 32.

    Kelleher, “Giving Dealers a Raw Deal.”

  33. 33.

    Milbank, “Independent Goodyear Dealers Rebel.”

  34. 34.

    Editorial, Tire Business, November 11, 2002, www.tirebusiness.com/article/20021111/ISSUE/311119980/dealers-can-aid-goodyear-recovery&template=printart. Accessed March 4, 2015.

  35. 35.

    Bruce Davis, “Michelin Unit Attempts to Satisfy Dealer Complaints,” Rubber and Plastic News 36, no. 12, 2007, www.rubbernews.com/article/20070108/NEWS/301089959/michelin-unit-attempts-to-satisfy-dealer-complaints . accessed March 4, 2015.

  36. 36.

    Bruce Davis, “Dealership Snapshot,” Tire Business, 20(15), October 22, 2012, p. 21.

  37. 37.

    Goodyear Tire & Rubber Co., Financial Statement, http://moneycentral.msn.com/investor , March 4, 2015; Ann and Elizabeth Harrow, “Worst 10-Year Performers: The Goodyear Tire & Rubber Company Skids Out,” http://moneycentral.msn.com/investor/invsub/results/staemnt.aspx?Symbol=gt&1stStatement=10YearSummary&stmtView, July 26, 2008; www.bloggingstocks.com , available at www.bloggingstocks.com/2008/07/26/worst-10year-performers-the-goodyear-tie-and-rubber-company-ski .

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© 2015 Andrew R. Thomas and Timothy J. Wilkinson

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Thomas, A.R., Wilkinson, T.J. (2015). The Customer Trap and Brand Destruction. In: The Customer Trap. Apress, Berkeley, CA. https://doi.org/10.1007/978-1-4842-0385-9_2

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