Keeping them in the family way?

Blood is thicker than water. That is the saying that marketers should perhaps bear in mind when considering joining a family-owned concern. There is no doubt an innate fear of being treated as a hired hand and an outsider.

In the face of strong family ties and pressure to adhere to heritage and tradition, many a marketer has probably been forced to bite their tongue when trying to develop a marketing strategy that meets the requirements of a fast-moving modern world. Debates may be had, but when it comes to making a decision the family holds the key.

There is little scope for compromise, it’s either fall out or toe the line as Patrick Thomas, former group managing director at William Grant & Sons, which owns Glenfiddich, has found out. However, where there are outside investors it is a little harder for the family to have it all their own way. John Hargreaves, whose family owns 52 per cent of listed value retailer Matalan, has come in for criticism from the City for parting company with more than one chief executive – Angus Monro, followed by Paul Mason – in the past few years.

For many family-owned companies outside investment is crucial. Without it in this age of globalisation and consolidation expansion is likely to be slow and there is the danger of family-owned brands being squeezed by larger rivals. In the drinks industry Bacardi, Pernod Ricard and William Grant are among those family-owned companies that are up against the might of Allied Domecq and Diageo.

However, it is not all bad news for family-owned brands. Large public companies with no family ties are responsible for delivering returns to their disparate shareholders, most of whom are only interested in quick gains. Family-controlled companies are in it for the long haul, ensuring that brands are not thrown off kilter or undermined by sudden tactical marketing exercises designed to deliver quick short-term sales but little else. They may miss out on opportunities due to internal wrangling among family members or through lack of capital, but in the long term they tend to remain true to their brands. In some cases a little too true perhaps.

Comments

    Leave a comment