Is Martha Stewart's brand too confusing?

ByABC News
February 27, 2012, 7:54 PM

— -- Cheery yellow bedspreads, snow-flaked artificial Christmas trees, shiny bathroom faucets, "cherry Popsicle" craft glitter, pastel-blue dog bowls —Martha Stewart has her name on all of them.

And with the launch of her new home office line at Staples earlier this month, Stewart can add filing cabinets, sticky notes and even her own form of rubber bands to her growing list of eponymous merchandise.

"The joke is: 'What doesn't she do well?' " says Ken Nisch, chairman of branding and retail design firm JGA. "She's carved out a pretty big area of competency that would be hard for someone else to get in on."

Martha Stewart Living Omnimedia generated more than a billion dollars in retail sales last year, up from about $750 million in 2010, with 8,500 products in more than 38,000 stores nationwide. Martha Stewart merchandise makes up about a fifth of the brand's revenue. Hers is the No. 1-selling home brand at Macy's. And 2010 research from Home Depot shows that selling Martha Stewart products at the chain led to customers buying more.

But as the lifestyle mogul has expanded her brand in recent years to include everything from pet supplies to office supplies, her licensing business gets closer to walking the line between a consistent brand and a confusing one, says Michael Stone, CEO of brand licensing agency Beanstalk.

"If you ask 50 people what the Martha Stewart brand stood for, you'd get a lot of different answers, which is not really what a brand is all about," he says. "A brand is a consistent image in people's minds."

In the last five years, Stewart has formed a slew of relationships to sell her products either directly to retailers or to manufacturers who distribute her products to multiple retailers. Starting with the Martha Stewart Collection for Macy's in 2007, the brand has expanded to include crafts sold at places including Michael's and Jo-Ann Fabric, home improvement items at Home Depot, pet supplies at PetSmart, and home office supplies at Staples. The betrothed can even seal the deal with a Martha Stewart-themed destination wedding at Sandals resorts in the Caribbean.

While her products are found in at least half a dozen retail chains, Stewart says all of her merchandise remains loyal to MSLO as a strictly home brand. "You don't find me making things that don't fit into the home," she said in an interview with USA TODAY when her Staples line launched. "We haven't veered from the path of making life more efficient, more organized, more beautiful."

This array of partnerships has been a smart strategy, says Michael Kupinski, who follows MSLO as an analyst for Noble Financial Group. "They decided that they did not want to put all their eggs in one basket like they did with Kmart," he says.

The brand's 12-year exclusive agreement with Kmart to sell products in areas including bed, bath and garden ended in January 2010 after experiencing a decrease in revenue during the partnership's final years, according to the company's 2010 annual report. After Kmart's bankruptcy filing in 2003 and subsequent store closures, MSLO products were sold in fewer stores, leading to a decrease in royalty payments.

"They rightly decided to kind of diversify their retail distribution and at the same time broaden the product line," Kupinski says.