Bernhardt not backing out on Kmart's queen
By Ray Allegrezza, Editor in chief -- Furniture Today, March 21, 2004
Attention Kmart Shoppers: In the event you were unaware, product licensing is a two-edged sword. Done right, and with the right partner, the strategy can help a manufacturer carve up a market faster than a brand new Ginsu knife can cut through a tender sirloin.
But what happens when a supplier partners with a celebrity, such as Martha Stewart, who suddenly finds herself in hot water? That's the other edge of the sword … the one that draws blood.
Martha Stewart, the undisputed domestic diva, has become a convicted contessa. Not a good thing. Where does the woman born Martha Kostyra go from here? Martha believes she will be "completely exonerated" on appeal. But many observers think she will not pass go, and will do time. She already has resigned her posts at her namesake company.
Fallout from the conviction quickly became evident. As one example, her syndicated TV show, "Martha Stewart Living," apparently is being pulled from CBS's New York affiliate following the jury's verdict. Both The New York Times and The New York Post reported that WCBS and other CBS stations could jump on that bandwagon as well.
The financial observers are coming out of the woodwork, predicting that Ms. Stewart's paté may be cooked. Some have referred to the Queen of Kmart as "damaged goods." Others have speculated that any prison time could pose significant problems for her company.
While a lot of folks already are bailing on Martha, Alex Bernhardt Sr. is not among them. On the heels of Stewart's conviction, Bernhardt Furniture sent out a press release that said, "In response to a guilty verdict in the Martha Stewart case involving a stock sale, Bernhardt Furniture announces it will continue to support the Martha Stewart Signature Furniture with Bernhardt program."
In explaining that decision, Alex said he believes that "consumers have learned to differentiate between occurrences in the personal lives of celebrities as compared to products that offer consumers good solutions for their own uses."
Bernhardt went on to note that, during the trial, incoming customer-sold orders remained strong, and the company hasn't been asked to delay or cancel new collection floor samples. Few furniture retailers appear ready to drop Martha.
"We are committed to these proven products developed by Bernhardt and the Martha Stewart Living Omnimedia company," said Bernhardt, "and our team along with their team of more than 500 talented individuals will continue to develop great products that support a market-proven aesthetic and a great brand."
I think Alex made the right call. While the cachet of a highly visible celebrity name can certainly help promote a line of furniture, I don't believe that any name — no matter how recognizable or popular — will prompt a consumer to buy poorly designed furniture, or any consumable, for that matter.
What do you think? As always, I am eager for your feedback. E-mail me at rallegrezza@reedbusiness.com.
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Bernhardt not backing out on Kmart’s queen
Mar 27, 2004
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