What’s in a name? Well, apparently a lot. A brand name, for instance, is the identity of your business. But many successful businesses change their brand names to meet new emerging situations. Here’s why and when your business may have to assume a new name.
- More meaningful name: It is essential that the brand name conveys your organizational objective. In case of a product name, the consumer should get a clear picture about the nature of the product. A business may have to change the product name if the present name is confusing or misleading. Sometimes, a product is upgraded to such an extent that it requires a new name to convey the changes. While considering this type of name change, you should properly quantify the impact. If you have been using your present brand name for a long time and have accumulated brand loyalty, then in such cases brand name change is not advisable.
- New ownership: When one business acquires another, the brands of the latter may be changed. This would of course depend on the strength of the brand names in question. If the acquisition was carried out primarily to acquire the rights over the brands, then the new owners would obviously not make any changes. But if the brands are weak, then this makes enormous sense.
- Adjusting for cultural changes: This is generally applicable to multinational companies operating in different countries and environments. A brand name may have different connotations in different cultures or languages. For example, GM Chevrolet had to change the name of its brand “Nova” in Spanish-speaking countries, as the word means “doesn’t go” in Spanish. Brand change may also take the form of change in logo as some images may not convey the same meaning in foreign markets.
- To remove negative image: Sometimes, businesses may run into legal troubles or scandals. In such cases, the management may decide to give the business a makeover in the form of name change. Computer Associates Inc. decided to change its brand name to CA Technologies after going through various accounting scandals. Through such name change, the company successfully dissociated itself from its murky past.
However, merely changing the brand name does not guarantee success. In some cases, such strategy may even backfire. It is necessary that a business fully comprehends the total cost involved in the re-branding exercise. Such costs may be tangible such as printing costs or intangible, such as loss of brand loyalty. Similarly, the company should also evaluate the benefits arising out of the re-branding exercise to make an informed choice.
Different businesses may have to adopt different strategies to make re-branding exercises a success. According to your circumstances, you may initially want to introduce the new name only in select markets to gauge customer response. Alternatively, you may decide to launch the new identity on a large scale.