Why would a company ever want to change its name? Why did Bell Atlantic become Verizon? Why did International Harvester change its name to Navistar? Why did Florida Power & Light evolve into NextEra Energy?
Sometimes companies simply have no option; they have to change their brand names.
When a company spins-off a business unit to form a new, independent business it is required to find a new name. AT&T spun-off its Bells Labs unit as Lucent Technologies, for example. Likewise, Guidant was spun out of Eli Lilly and Company, Agilent Technologies was spun out of Hewlett-Packard and Cenovus Energy was spun out of Encana Corporation .
Mergers are another occasion when corporate names are changed, often more for corporate-political reasons than anything else. That’s why we get a lot of compromise names such as ConocoPhillips, ExxonMobil, NewellRubbermaid and AOL TimeWarner (RIP).
And then there are times in a company’s business evolution that the question of the corporate name forces itself on the business agenda and just refuses to go away.
All successful companies grow and evolve. They outgrow and move beyond the foundational origins of their business – like Verizon, Navistar and NextEra Energy.
These companies needed to signal a new strategic branding direction to escape the confines of perceptions based on a reality long past and move forward.
Executive teams usually make decision to change a corporate name based on clear, carefully-considered and rational criteria, but once made they enter the dark, confounding world called Naming.
Expectations start high. It sounds like fun. “There’s an ideal name out there, I’ll know it when I see it” is the belief going in. This rarely happens. The ideal name never jumps off the page.
Up go lists of strange, unfamiliar words that just seem to sit there. Personal favorites disappear through the screening process. Enthusiasm turns to frustration. Suggestions are plucked out of the air. Someone suggests an employee contest to find a name that yields nothing usable and the spiral continues downward to inertia and indecision.
This is an all too common scenario with poorly managed naming programs. However rational the business decision to change, naming is more about psychology and emotion than anything else. It is, above all, a managed process that requires experience and strong counsel.
Here are seven rules of the road to avoid the naming wheel of pain and ensure a successful outcome:
- Get Serious
Corporate rebranding is not a game for the inexperienced. Getting a group of students in a room with beer and pizza, as one General Counsel of a major corporation suggested, is guaranteed to fail. Find a professional branding company that has done it before. Make sure they have resources in-house. Check references, talk to the team members about their experience and their philosophy of naming. And above all, make sure they understand your business and how it works.
- Look two steps ahead
Names should be created for tomorrow and not just for today. Enough time should be spent analyzing the market, identifying opportunities for differentiation and setting the appropriate strategic naming objectives to be used for the brand naming evaluation process. In today’s highly competitive environment, the strongest brands are the ones that transcend the physical attributes of a product or service to form an emotional connection with the customer. Jeff Bezos, the founder of Amazon, deliberately picked a general, non-product specific name because he knew he’d eventually be selling more than books.
- Get uncomfortable
Step outside the comfort zone of your industry and the competition. Look for inspiration outside your category and learn from completely unrelated brands. Names created in this way have the advantage of being more readily available from a trademark perspective since they go beyond the common category descriptors into fresher territory.AirTouch Cellular – launched as a spin-off from Pacific Telesis – completely broke the mold of the “com, cell, tel” names and was a resounding success in the marketplace, but it was a difficult choice for senior management because it was so unfamiliar. They were ecstatic about the name however when AirTouch was acquired for $68 billion.
The lesson: names that make you feel uncomfortable at first should not be dismissed…usually these are the ones with impact and differentiation in the marketplace. Winning names don’t always rise to the top immediately; they need time to sink in.
- Avoid the “CEO’s wife” syndrome
When it comes to final name selection, avoid the informal focus groups with your nearest and dearest. It is not a popularity contest. A small team of the key decision makers who have a good understanding of the business and strategic objectives should select the final name. Senior management needs to be involved throughout the process.Do not evaluate the names based on a like/ dislike basis, but more on a “fit-to-concept” scale. Every new name will look strange at first. Remember the strategic objectives you set up at the beginning of your process? Now is the time to use them. Check each name against these criteria.
- Be prepared to fight for your name
A major difficulty of corporate naming today is legal availability. It is often said that every word in the dictionary is legally encumbered. That’s why you’ll rarely find a new corporate name based on a word that can be found in the dictionary.A more usual route is a hybrid name made up of two word parts, such as Agilent, Entergy and Verizon. They sound familiar, but they are clearly manufactured words, thereby being all the more ownable and unique.
Build in enough time for full legal investigation. There’s a chance that the name will be in use by a company somewhere for a product or service, however marginal. Be prepared to negotiate.
- Listen to your target audience
If appropriate, test the old name alongside new alternatives. Again, the criteria is not like/dislike but “fit” – can this name carry the meaning of the company in the future? The key in naming research is to listen carefully for things that can be overcome (e.g., neutral to negative associations, etc.) and for things that need to be addressed, such as inappropriate translations. Even if you are solely US-based business, we live in a very diverse country and cannot ignore key languages such as Spanish and French.
- Let everybody know the smart, strategic vision behind the new name
Have a well-planned and well-executed communications campaign to support the new name. People need to understand how they should think of a new name.
Your internal audiences are the most critical for the success of the new name.
Your internal audiences are the most critical for the success of the new name. Employees are the ones who have strong emotional attachments to the old name; they are also the ones who will “live” the new brand on an everyday basis and they should feel good about it. The goal is to use internal communications to raise employee morale and excitement about the name by building awareness, generating acceptance and sustaining commitment. In this way, you enable them to better understand the transition, the new brand promise and create a “rally call” for success.
And remember – a name’s ultimate meaning is always the result of ongoing communications and people’s experiences with an organization and its products and services.
Just think of Google, Amazon and eBay, or Shell and Kodak for that matter.