Name changes, when done right, reflect a changed company
Do you remember Lucky or Goldstar? How about Drivurself? Or Confinity? These are all companies that have renamed themselves, as the company MoveSouq.com has recently done here in the UAE. But are they really roses by any other name and do they still smell as sweet after a makeover?
Just three years after its creation, MoveSouq.com has already rebranded as ServiceMarket. It comes after a US$3 million funding round, and a diversification of its suite of services.
Originally the site, as its name would suggest, compared moving costs; it has since expanded to cover quotes and online bookings for about 25 home services, such as cleaning, decorating and pest control, as well as home and car insurance.
It is also moving beyond its Dubai home base to trade in Abu Dhabi, Sharjah and Ras Al Khaimah, and Doha in Qatar.
Its co-founder Bana Shomali says MoveSouq had become “too narrow” a name. “We were predominantly associated with being a moving marketplace,” she says. “We felt it was necessary to rebrand to a broader name that could be associated with all services equally.”
The other big-name change in the region has been that of the classified ads platform Dubizzle, which, while retaining the name in the UAE, threw off its Dubai connotations in its other 10 Middle Eastern markets when it was bought out by OLX.
Another big new regional name was created through a media merger in 2009, when pay TV operators Orbit and Showtime Arabia partnered and rebranded as Orbit Showtime Network, better known today as OSN.
So what about Lucky and Goldstar? Lucky was a Korean cosmetics and plastics company founded in 1952; it started another electronics brand, Goldstar, before changing the company name to the now well-known LG in 1995. Drivurself became Hertz Rent-A-Car in 1953, and Confinity became PayPal in 2001.
That was clearly a big year for name changes: Andersen Consulting broke its contracts with the accounting group Arthur Andersen in 2001. The former was forced into a $100m rebrand to the new name Accenture, which Time magazine called “one of the worst re-brandings in corporate history”.
The new name was the result of an internal competition, a play on “accent on the future” with a little accent over the “t” to match. While bland, it actually saved the company from future fallout; Arthur Andersen was linked to the Enron scandal soon and dissolved after being found guilty of criminal charges relating to its auditing of the energy company.
And headlines were made worldwide when Google became Alphabet last year. Google kept its place as search engine and Alphabet became the parent company, although Alphabet’s stock still has the ticker symbols of GOOG and GOOGL.
What, then, are the ramifications of a rebrand?
“Rebranding is a risky business and best avoided unless there is a real need,” says Nigel Hollis, the chief global analyst at the brand equity consultancy Kantar Millward Brown – a company itself recently renamed to reflect the name of its parent company, Kantar.
ServiceMarket’s Ms Shomali says it took months to decide on the name, which needed to be simple and easy to understand and spell but with a “premium and trustworthy feel”; something people could hear on the radio then find online – and, of course, the URL had to be available.
The company ran a teaser campaign before the change, then used email marketing, blog posts, social media and online and offline marketing campaigns after the rebrand, with customer services prepped to deal with any queries. The logo was also changed – and updates made to 2,000 pages on the website. There could have been more work if the legal name had also changed; that would have involved changing bank accounts and staff visas too.
Costs – which ServiceMarket declined to reveal – had to cover the brand and design makeover, advertising, marketing and PR, technical development and internal rebranding, such as business cards and stationery. It is still in the process of trademarking the new name in the UAE.
Mr Hollis says it is important for advertising to “clearly link” the two names. The risk otherwise is that the new name is disconnected from customers’ “positive associations” with the old brand. “Essentially the brand goes from established to new and, unless a substantial investment is made to bridge the disruption, the brand may never recover its prior status,” he says.
Kantar Millward Brown estimates that brands that change name can expect a drop of between 5 and 20 per cent in sales and can take years to restore levels; others are only negatively affected in the short term.
Certainly, Accenture’s rebrand proved that even a nine-figure spend may be worth the money – and left it smelling sweet despite the Enron ignominy.
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Updated: December 28, 2016 04:00 AM