Thu Nov 16

Is Jim's Beauty set to flop like Colgate lasagna or Harley-Davidson perfume – or could it be branding genius?

Written by Edwina Luck, Senior Lecturer QUT Business School, Advertising, Marketing and Public Relations, Queensland University of Technology

Jim’s Group – best known for Jim’s Mowing ^[1] and Jim’s Plumbing ^[2] – this week announced a surprising brand extension.

It’s Jim’s Beauty ^[3], offering “professional beauty treatments in the comfort of your chosen space”.

It’s surprising because Jim’s Group got its start mowing lawns, then extended into related businesses ^[4], including dog washing, pest control and roofing.

These services are usually offered in the client’s home, and are provided by franchisees, as will the beauty services – which will include facial, lash and brow and nail treatments, as well as waxing and teeth whitening.

It isn’t a joke, although it has been greeted on social media as one, and was once the plot of a TV comedy sketch ^[5].

Brand extensions are nothing new

Brands often try to extend their “halo ^[6]” to cover other fields, hoping to capitalise on goodwill and stay relevant in a changing world.

Fast food giant McDonald’s is a leader, introducing McCafes ^[7] in 1993, salads and wraps in the 2000s, and more recently adding plant-based and vegan meals.

Coles and Woolworths have diversified into just about every product there is by selling their own generic home brands.

This has allowed them to undercut other brands and get more margin – a strategy that is paying off as consumers become more stretched, allowing Coles to increase home brand sales 9.4%^[8] and Woolworths 7.8%^[9] over the past year.

Even their delivery services ^[10] can be thought of as brand extensions. Away from their physical stores, they are offering telehealth ^[11], insurance ^[12], mobile phone plans ^[13], gift cards ^[14], and deliveries at work ^[15].

It works where there’s brand alignment

Brand extensions work where there is brand alignment ^[16] – where the extension is true to the image of the brand and doesn’t devalue it.

Among some of the most infamous failures ^[17] are Harley-Davidson perfume ^[18], Bic underwear ^[19], Cosmopolitan yogurt ^[20] and Colgate beef lasagna ^[21].

Sometimes the extreme strangeness of an extension can create a buzz around a faded company, even if its sales bomb.

Cadbury briefly introduced Vegemite chocolate ^[22] in 2015, but then said it hadn’t been serious. What it had wanted to do was to “generate talk ^[23]” about rediscovering favourite flavours.

Jim’s could fill a gap in the beauty market

Industry researcher IBISWorld ^[24] says Australia’s beauty industry is characterised by “market saturation and the wholehearted acceptance of its products by consumers”, which isn’t a good sign for Jim’s.

But IBISWorld says sales of beauty products are overwhelmingly through physical stores with “new channels” (mainly online) accounting for only 13.8% – which suggests there is room for growth in face-to-face sales aligned with services.

Jim Penman started Jim’s Mowing as a side business in 1982 ^[25] while studying for a PhD in history. He turned it into a franchise in 1989 and then extended the idea to franchises including Jim’s Cleaning, Jim’s Building Inspections, Jim’s Fencing, Jim’s Antennas, Jim’s Pest Control and Jim’s Dog Wash.

A blog on a Jim’s Group website describes it as a “go-to for a plethora of services ^[26]”. But they are all associated with the guy who used to have the beard – the tradie.

His success, or failure, in moving into beauty will help answer one of the enduring questions in business strategy: just because you can, does that mean you should?