Sales are stagnant. New customers are few and far between. Competitors are nipping at your heel. What to do? Must be time to change your name, right? Not so fast.
I’ve worked with numerous companies on name changes or the consideration of a name change for their entire organization or various products and services both as an internal director of corporate communications for an energy utility and healthcare organization and, now, as an independent consultant. There have been some surprisingly contentious discussions and finding consensus can be challenging (although also quite rewarding when you find it)!
In most cases I’m not in favor of a name change, but there are exceptions as I’ll discuss later. Often, the desire to change a name is driven by the misperception that changing the name will suddenly boost sales, create new customers and make competitors shrivel up and go away. Rarely is that the case. They associate their name with their brand and while they may be right that they need to do something to boost their brand, changing their name is rarely the answer. In truth, while part of the brand, a name is *not* the brand; strengthening the brand requires much more than a name change and can be done without a name change.
1) When should a company or business change its name?
When the company or business has literally changed and the name change will help in communicating that change to audiences that may otherwise be confused. A good example is after a merger of two well-known companies; unless one is being “assimilated” by the other, this can be a good time for a new name change. Another consideration that would appropriately prompt the consideration of a name change is when evidence exists to suggest that potential customers are confused–or worse, put off–by the current name.
2) When should a company or business NOT change its name?
As I mentioned above, don’t think a name change will somehow magically, on its own, boost your business. It won’t happen. Companies generally point to well recognized brand names — e.g. Apple, Nike, etc. — as examples of “great company names” and they “want one like that.” When they do, though, I point out to them that when Nike was first named the name meant nothing. It’s what the organization does, over time, that creates a strong brand, not the name it selects when it opens its doors.
3) What mistakes usually occur when a business decides to change its name both in terms of the name it arrives on and the execution of it?
One big one that the trademark attorneys I work with always emphasize, and it’s somewhat counter-intuitive, is that they pick descriptive names–names that readily describe what they have to offer. Seems logical, but the problem with that is that these names are virtually impossible to protect from a trademark standpoint–they are too generic. Fanciful names are best (although good luck in getting some of these approved through the levels of bureaucracy that exist at many organizations!) Again — key point–it really isn’t about the name; any name can become a great brand. It’s about what is done around the name in terms of the product/service quality, customer service, pricing, communication, etc., etc., etc., that will drive your business success.
Finally, never, never, never change your name when you have evidence that suggests that there is a great deal of brand equity tied up in that name. Believe it or not, some organizations do. Then they find themselves faced with a new challenge. Rebuilding brand equity while trying to successfully convey to the public–and their customers–that they’re still really the same great company they always were.
Tags: brand, brand equity, Brand Management, brand name, name, naming