Corporate branding oops

Wal-Mart, Home Depot, JetBlue suffered some big marketing missteps over the past year; Plus: A look at brands that got it right.

By Parija B. Kavilanz, CNNMoney.com senior writer

NEW YORK (CNNMoney.com) -- Lately, anytime you put the words "corporate" and "blunder" in the same thought, Wal-Mart inevitably seems to come up.

Maybe that's because Wal-Mart suffered suffer some embarrassing branding blunders over the past few months. But it wasn't the only offender, industry experts said.

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Apple continues to solidify its brand leadership with strong innovation at the core of its business supported by clever advertising.

"Again we've had no shortage of big branding mistakes last year and even early this year," said Kelly O'Keefe, an independent branding consultant and CEO of O'Keefe Brands.

O'Keefe has published an annual branding "Hall of Shame" for five consecutive years.

He hasn't yet published his most recent list - that's due in upcoming weeks.

However, he picked JetBlue, Home Depot and Turner Broadcasting (a Time Warner (Charts) division and parent of CNNMoney.com) as examples of other companies that he would induct into his most recent branding "Hall of Shame."

Wal-Mart Some analysts argue that being the world's largest retailer makes the discount behemoth an easy target for critics. While that might be so, O'Keefe counters that Wal-Mart itself does a pretty good job in generating plenty of easy fodder for its critics.

The retailer had a string of recent bloopers. It abruptly fired its new ad agency, DraftFCB, last December just a month after awarding it a $580 million contract.

Wal-Mart also fired marketing head Julie Roehm because she reportedly violated its strict ethics policy by having a personal relationship with another colleague and allegedly accepted gifts from clients. Roehm sued the company claiming Wal-Mart's charges were false and said that Wal-Mart was a difficult employer. [Full Story]

"The flip-flop with the ad agency was a huge debacle and was pretty embarrassing," said O'Keefe.

Additionally, Wal-Mart's upscale clothing push with "Metro 7" fell flat in 2006 [Full Story]. In October, Wal-Mart pulled the plug on its teen social-networking endeavor called "The Hub" after only 10 weeks following humiliating reviews in the media. [Full Story]

"Wal-Mart made the mistake of trying to run away from its brand rather than building on it," O'Keefe said.

"Wal-Mart grew by catering to mid-America values of great customer service, low prices. It took care of its employees. That's the Wal-Mart that Sam Walton built," he said. "Today's Wal-Mart looks more like a Kmart. It's lost those values that made it great. Wal-Mart needs to reconnect with itself rather than trying to compete with Target (Charts) or somebody else."

Robert Passikoff, branding expert with Brand Keys Consulting, agreed.

"Wal-Mart often appears to be an impatient brander. Is this corporate hubris? Maybe. Wal-Mart should realize that the 'anything you can do I can do better' attitude doesn't work all the time," Passikoff said.

JetBlue JetBlue suffered a tremendous fall from grace earlier this year when a winter storm paralyzed its operations in the Northeast for nearly a week and stranded hundreds of travelers in airports. Some passengers were stranded on Jet Blue planes for more than 10 hours and frustrated passengers posted videoclips of the chaos on YouTube.

"In today's electronic age, bad news spreads fast," said O'Keefe. "JetBlue was one of the strongest brands in the country before this fiasco. It was a service leader and the company was growing by leaps and bounds."

He faults JetBlue CEO David Neeleman for taking too long to apologize for what went wrong. "He took over 24 hours to make an apology," O'Keefe said. "He should've acted much faster to say he regretted what happened and that JetBlue would make amends."

Nevertheless, Neeleman kept his job and JetBlue (Charts) said it would spend millions of dollars refunding cancelled tickets. It also published a "Customer Bill of Rights." O'Keefe said it will take a long time for JetBlue to repair its tarnished image.

Turner Broadcasting System Turner's guerrilla marketing campaign for the Cartoon Network show "Aqua Teen Hunger Force" went awry earlier this year.

The campaign consisted of battery-powered cartoon advertising signs that were placed around Boston and other cities. The signs led to a massive security alert around Boston amid fears of a bomb scare.

Turner Broadcasting apologized for the incident and compensated the city $2 million for any disruptions that occurred. Moreover, the head of Cartoon Network subsequently resigned

"The rules of marketing dictate that you don't scare people and you don't do anything illegal like putting devices on public structures," O'Keefe said. "This reminded me of IBM's graffiti ads from a few years ago when IBM paid people to spray 'peace, love and Linux' ads on sidewalks and these ads didn't wash off."

Home Depot O'Keefe said the home improvement retailer's brand took a blow when its CEO Robert Nardelli resigned in January after a prolonged speculation about his leadership style and Home Depot's slowing profits.

While Home Depot (Charts) is still one of the largest retailers in the world, O'Keefe said the brand still has had a tough time connecting with its customers, especially women shoppers. "Lowe's is far more successful in that regard."

The successes....

Apple Analysts said Apple' (Charts)s iPod held its own over the crucial holiday shopping season despite a big attack from Microsoft's competing product, Zune.

O'Keefe said Apple's OS X operating system also continues to be favored over Microsoft's new Vista operating system.

"It's astonishing to think that Apple could possibly trump Microsoft on its home turf," he said. "Moreover, Apple's iPhone is hotly anticipated as is Apple's iTV. Apple did the right thing by changing it's name to Apple Inc. from Apple Computer because it truly is evolving into a consumer electronics company."

Stephen Colbert Time magazine named the Comedy Central satirist one of the 100 most influential people in 2006. In December, GQ named him Man of the Year.

"The decision to take someone who played a phony correspondent on 'The Daily Show' and give him his own show has paid off well," O'Keefe said. "Colbert's charm has made him one of the best and strongest brands of 2006."

Federated Department Stores The operator of Macy's and Bloomingdales announced last month that it would rename itself to Macy's Group to reflect a more uniform brand identity among consumers nationwide.

Federated changed the name of 400 May stores to Macy's last year after acquiring May in August 2005. It also decided to remove the iconic Marshall Field's name in favor of Macy's last year.

"I'm neutral about this one for now. It is a big gamble to rebrand so extensively and it could go either way," O'Keefe said.

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.