What's in a name
Tadano is planning to drop the Demag name later this year, a move that carries a good deal of risk. Stuart Anderson of Chortsey Barr gives his view.
Over the course of some 40 years, I have enjoyed close relationships with various generations of senior executives at both Demag and Tadano as well as the rest of the crane industry. When asked, the advice I have given has always been factual and straight forward, including most recently at bauma 2019 when Tadano announced its acquisition of Demag. Those conversations remain strictly confidential of course.
The past 18 months has been one of the toughest social and business environments we have seen, with plenty of ‘bumps in the road’ for many players in our industry. Nevertheless, it was with a great deal of trepidation that I read the April 7th announcement by Tadano that it plans to drop the Demag brand - one of the world’s most revered and widely recognised crane brands. Particularly as it came just a couple of years after the successful relaunch of the brand following Terex’s realisation of its error in dropping it back in 2004. Quite frankly ignoring such a clear message of history startled me.
Branding matters are often fraught with danger and never as simple as they may at first appear. It’s an area I know well from personal experience. When Grove acquired Coles and re-branded its European cranes as Grove-Coles, the Grove brand was almost fatally wounded and only regained any credibility when the Coles factory and its products were finally committed to the scrap heap. It was a decision made by my boss, Grove chief executive J. Martin Benchoff, a decision he regretted for the rest of his life.
Such matters are complicated and there are two sides to every argument. Amalgamating the Demag AC and Tadano ATF product lines was always going to be difficult - regardless of branding - and remains so. That’s a sufficient difficult mountain to climb without further confusion!
Even more ‘surprising’ is Tadano’s decision to drop the Demag brand from its lattice crawler cranes. In my opinion the following facts are unalienable:
- Outside of Asia the Demag brand is the stronger for its All Terrain cranes and large telescopics.
- Despite being dropped for 10 years by Terex, the Demag brand remained one of the strongest and most highly respected for mobile crane technology – bar none.
- For the large-size crawler cranes, Demag is widely regarded as much of a market leader as Liebherr. Obviously when it comes to large crawler cranes the Tadano name has no resonance and it will take decades to develop a reputation to match that of Demag.
Changing brands and nomenclature systems is a minefield. Surely Terex’s bad mistake in dropping the Demag brand for 10 years is evidence enough. Changes to the nomenclature as announced by Tadano can only add to further confusion presenting an ‘own goal’ to the competition.
Frankly I can see no overriding business benefit to Tadano’s strategy. There are no easy answers - the only advice I would offer is make as few changes as possible and take as much time as you can. In that respect it is unfortunate that this critical decision coincides with Mr. Koichi Tadano’s decision to step down as CEO.
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