Will 2020 be the Year of Brand Protection?

When you manufacture a product, it’s an arduous task – not to mention expensive – to get your brand entrenched in the consumer consciousness. The next hurdle is to have that brand immediately associated with quality.

If you’re in the lighting industry, brand recognition is especially difficult. For years, there has been a tug-of-war at retail between promoting the manufacturer versus the showroom name as a brand.

Now that the internet has made a retailer’s reach far more expansive than its surrounding local community, advertising brand names through manufacturer-provided signage and vignettes has become more popular at the showroom level. No longer keeping the manufacturer a mystery has definitely helped with brand awareness, but on the flip side, it has inevitably led to price shopping. What muddies the water for both consumers and showrooms is discovering just how many places those brand names are offered — including distributors who aren’t authorized to do so.

The growing problem of “third-party sellers” and “unauthorized dealers” is a new plague in the Electronic Age that is complicating things for the consumer. One of the most widely recognized brands in the world, Nike®, took a bold stance in November by announcing it was severing ties with Amazon in effort to curb the plethora of counterfeit sportwear and footwear bearing its name from third-party sellers and unauthorized distributors. Naturally, this same problem has been happening in the lighting industry. Put any lighting brand in a search bar and you’ll be overwhelmed by the amount of products that seem to be available. Very often, these are from third-party sellers unknown to the manufacturer — but obviously, the consumer does not know that.

Besides Nike, there are more companies taking a hard stand against unauthorized distributors. Several months ago, Matteo Lighting let its customers know that it will not sell to the likes of Amazon or Wayfair in order to protect its dedicated showroom channel. And this month marks the entry of KOHLER Lighting – part of plumbing giant  – which is making a similar pledge to the lighting showroom network (see article on page 22).

At the recent ALA Conference in Phoenix, there was a well-attended seminar on Pricing Policies (page 82) that also touched on the complications of online selling today. Perhaps the year 2020 – and the ensuing era of the new Roaring ’20s – will have more manufacturers taking steps to protect their brands in similar fashion by taking tighter control of their distribution channels.