Why do companies like to tinker with their names? David Bernstein comes across an intriguing academic article on corporate name changes
Working in marketing communications brings you into contact with toilers in parallel worlds, who treat commercials as film, posters as art, press ads as social history.
In mid-career, I encountered the parallel world of academia. Following the pioneering work of Wally Olins, I wrote a book on corporate communication. We were invited to join the editorial board of a new journal, Corporate Reputation Review.
In its latest issue, all but one of the contributors are academics. They have time to study the subject that practitioners, presumably, are too busy practising. Laurent Muzellec of Trinity College Dublin, for example, buttresses his fascinating article on corporate name changes (What is in a Name Change?, CPR, Winter 2006, Palgrave Macmillan) by accessing 166 corporate websites, 33 of which provide explanations of their new names – proof of the old political adage ‘never apologise, never explain’.
Why does a company go through the turmoil of a name change, expending time and energy in chucking out heritage? Answer: the situation has changed, rendering the existing name too restrictive.
‘The name Centrica,’ its website informs us, ‘was selected because of its ease of use internationally. In many languages the word Centrica is meaningless and therefore cannot conflict with overseas language translations.’
I would argue that no word is entirely meaningless; each connotes something – though whether it connotes what the company hopes is another matter.
Andersen Consulting assures us that ‘the Accenture name connotes putting “an accent on the future”‘. That Lucent Technologies, a spin-off of AT&T, conveys ‘clarity’ or ‘glowing with light’ is fairly obvious. But can the same be said for the rebranded KPMG Consulting, whose name Bearing Point, its website claims, means ‘Set direction, gain access to the right information, transfer knowledge and achieve results for their long-term success’?
Some companies rebrand to proclaim, perhaps belatedly, their philosophy. ‘Exelon stands for experience and excellence, and that’s what the new company will be all about.’
The purpose of any brand name is, first, to identify and differentiate and, second, to convey favourable associations. However, concentrating on the latter may jeopardise achievement of the former. Reflecting corporate values is all very well, but they are finite in number. Is it any wonder that so many names that attempt it are indistinguishable?
Companies add to the confusion by playing safe. Muzellec detects ‘a natural apprehension towards novelty’ and ‘the common inclination to repeat what seems to have worked elsewhere’. He cites the frequency of Latin-coined names and the echoing of name elements within a category (is the double ‘O’ in Yahoo, Google and Wanadoo a mere coincidence?).
So what should a company do? Do the explanations provide a clue? Are they little more than post-rationalisations, and shouldn’t the real thinking have started at the outset?
Muzellec believes, surprisingly for an academic, that the answer could lie not in research, but in ‘the proposition that thriving brand names are the result of fine poetry rather than obedient science’. Poetry – now that’s a parallel world worth exploring.