Time for a Name Change? 5 Reasons for Corporate Rebranding
Naming a new company is hard enough. Renaming it can be downright painful. (And expensive: the corporate rebranding of Andersen Consulting as Accenture, for example, cost an estimated $100 million.) So it’s not a decision to be undertaken lightly. A company needs to weigh whatever equity and good will their existing brand name has already accrued against whatever benefits they’re hoping to gain by shedding it.
That said, there are legitimate reasons for changing a company name (or at least considering it). Here are five of them, and our perspective, as a naming firm that often helps clients with the delicate process of rebranding.
The positioning of the brand has changed.
Companies change over time. The focus might broaden or narrow—or shift altogether. As naming consultants, we try to help clients anticipate these changes when naming a new business, so their brand name is as elastic as possible. But if a brand’s premise has undergone a significant shift and the name no longer fits, it could be time for a corporate rebranding that better reflects the company’s mission. For instance, The Nashville Network (formerly The National Network or TNN) changed its name to Spike TV when it decided to market primarily to male viewers. Cell BioSciences changed its name to ProteinSimple to reflect its new mission of simplifying protein research. eProject redubbed themselves Daptiv to highlight a new focus on customizable business tools. In each instance, the name change reinvigorated the brand with a strong and specific sense of purpose.
Someone discovers a negative meaning or association for the name.
While this can be an important and valid reason for a corporate rebranding, it’s important to avoid a knee-jerk reaction to news of a negative meaning. Two questions to ask before renaming a company because of negative associations are 1) how bad is the meaning? and 2) how many people are likely to be aware of it? A lot of people freak out when an off-color meaning of their brand name shows up in Urban Dictionary, for instance, or in a non-English language. But if the association is an unusual one or the language is not widely spoken, this may not be cause for alarm. Most interesting words have at least some negative or racy associations. (Think Virgin, for instance.) Unless the negative meaning is a serious one in a widely spoken language and likely to be top of mind, it’s often not a deal-breaker. But if it is, then all replacement name candidates should be subjected to a thorough linguistic screening this time before selection of the final name. (Here a good naming firm can be a tremendous help.)
People have trouble spelling or saying it.
As any brand name consultant will tell you, ease of use is key. Renaming Tony Flow and the Miraculously Majestic Masters of Mayhem as the Red Hot Chili Peppers: good move. Renaming Pacific Telephone and Telegraph as Pacific Bell: ditto. And who wouldn’t celebrate the renaming of Tokyo Tsushin Kogyo as Sony?
It’s being challenged legally.
If the challenge has validity, then the sooner the brand is renamed, the better.
Public perceptions of the brand have soured.
A corporate rebranding can be a useful reboot if a company’s credibility has tanked, but actions will speak louder than words. ValuJet renamed itself AirTran Airways after the devastating crash of one of its DC-9s back in 1996, and that worked well—in part because the airline has not had a fatal accident since. But when the private security company Blackwater renamed itself Xe in 2009 amidst a wave of scandal, it didn’t do much good, and in 2011 the company renamed itself again (as Academi) as part of an attempt at a total corporate makeover.
Bottom line: a corporate rebranding can be an important first step in clarifying, energizing, and (sometimes) sanitizing a brand. The rest is up to the company.