Misplaced Convictions

... As a rule, brand name change should be overwhelmingly justified. Most importantly, it should be understood that a need-to-change even on marketing consideration arises more as a compelling one and not as an option. A change, whatever the reason, should be proposed not on the worthiness of the new one but essentially on the deficiencies of present one.

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Ever since 'Indian Airlines', the brand, was retired I have been thinking hard to figure out the advantages the Airline hoped to generate from dumping the good old name. It occurred to me as a wild shot from an unexpected zone. A need to change a brand name hardly arises. (See pic. 1 - 'Need situations' for brand name change). Most won't need a change ever. A very few, due to issues on ownership face a consequential compelling need to change. And, quite a few hard-to-build ones can possibly be terminated for a branding-worthy one provided it is feasible to execute. That only sounds simple. Many a mistakenly changed and unchanged brand names tell how hard it is to decide.

Naming and renaming brands, being part of core marketing decisions, can - with a mistake, which seems likely, restrict effectiveness of marketing efforts rather obscurely.

Changing a brand name is largely perceived - 'too-risky' - that even when a change is clearly warranted it is mostly avoided. It is a decision both brand owners and managers hesitate to initiate and take responsibility for. This move by IA is startling not because it could cut through the fear but because in doing so it changed a worthy name unnecessarily. Emotions - true in cases where brands transit generations and misplaced convictions are the two factors that lead to mistakes in names.

Though the decision to change, where it is necessitated by ownership issues, is rather obvious it is hardly believed to be so. Anil Ambani chose to adopt the brand name Reliance for his group of businesses too. The break away faction of the Manipal Group still believes it helps to use the brand Manipal Group. Mistakes in primary branding happen when fundamental questions are missed. If the intention of the split is to build separately on a set of exclusive identities; what benefit can be derived by sharing a brand in achieving that? Issue of sharing a brand by two estranged parties arises only in the case group brands upon a split in ownership. In the case of Reliance, due to seamless application of the group brand to products / businesses across categories the renaming task was, probably a bit challenging. The conviction that brand values cannot be migrated to a new name and the perceived risk of loss of valuable identity makes the part owners unrelenting to forgo the brand which they essentially see as an asset of big value in which they have a rightful stake. In the case of larger groups this feeling of insecurity and ownership only gets reinforced by some real emotional factors. Rather obscure truth is that the shared brand which is believed to be critical to sustain and propel separated businesses can only prove to be restrictive and actually negates the possibility of building much greater value with an altogether different name. On the contrary, without an absolute identity, predominantly group driven businesses and brands suffer from lack of seamless leveraging from the group brand. The logic remains hard to fetch since the loss isn't really considered. Loss of cost and marketing effectiveness owing to lack of an exclusive brand can be very huge, more so when the group brand is widely adopted for businesses of the group.

What happens when a brand name is changed? A brand name is akin to a container which reflects a collection of identities and virtues - positive as also negative - essentially and precisely as perceived by the consumers in varying depths dependent on each one's level of awareness and experience with the brand. And, when the name is changed the situation is same as changing the container for anything. To those, who are aware of the change, the new name would reflect the attributes of the brand in almost the same way the old one did. The essential task is of informing the whole set of consumers, which is hard and very expensive to achieve given the media complexities and consumer attention limitations. Chances of a change-over with insignificant transfer loss and even the effectiveness of advertisements in a name change campaign arise from factors such as brand status, product maturity, market structures and situations. The question to be considered is; can the change be effected with ignorable transfer loss? The answer, as said, depends on the business and the kind of market it serves and not on the brand, irrespective of the stature. (See pic-2) Transfer loss happens to be ignorable if the brand, product and market situations are in the early evolving stage or when quite mature.

ADAG with the mature and racing telecom business and the sure-to-spurt insurance businesses within its fold, should have gone in for a new name, may be ending with '…nce , in progressively building a powerful brand and thus a big advantage. With millions of customers and lacs of customer access points scattered across the country, the transfer of elements of equity would have been almost absolutely complete, particularly with the brand Reliance and the split so widely known. As said and in contrary to even professional belief, the transfer loss happens to be ignorable when the brand is big and hugely popular. Even the best of stuff built over a mistake becomes a mistake. The whole lot of branding logic that created ADAG's Reliance - - the sleek and bent font for an exclusive identity, which ironically, has to be seen to tell it - - from the other one, is inarguably flawed - - being built on a mistake. As the groups progress also adding businesses the brand Reliance would progressively become ineffective for both the groups in serving brand power to their respective businesses. Similarly, Sudhakar Pai who heads the set of businesses separated from the Manipal Group, can enormously empower his businesses with the name of his father late T Ramesh Pai - the legendary personality who was synonymous for the Manipal Group for years.

It is however tough to tell - - to or not to change a brand name when it is contemplated entirely on marketing considerations - - without a compelling need to change. I believe brands that are not in tune with the market growth despite good fundamentals and good enough efforts do need a name review as part of brand analysis to check if the name is a drive or a drag. Even here it is really hard to decide only in case of brands that hang in a balance in the market. Such cases call for a very good understanding of the market situation and the brand's position to avert the mistake.

To avoid mistake it is critical to ask some basic questions. (See Pic - 2: Factors for validating brand name change). As a rule, brand name change should be overwhelmingly justified. Most importantly, it should be understood that a need-to-change even on marketing consideration arises more as a compelling one and not as an option. A change, whatever the reason, should be proposed not on the worthiness of the new one but essentially on the deficiencies of present one. Yet, proving a name not brand-worthy may not be enough to go ahead with the change. It should be feasible too. There is real risk in changing a name that has evolved into a brand. Think about changing Ghadi, the detergent. The risk is simply huge considering the product category and the nature of the market.

Indian Airlines obviously missed to put out the fundamental questions in the first place. Firstly, as said, a name has to be hopelessly deficient to be considered for change. The most important question to answer is; why change? It is in fact hard to get a thing wrong with the good old name that had become a brand. Two, a name that has evolved into a brand must not be changed. Trying to find a better name for an established brand that's good enough can only be futile. Three, name of a brand established over time must not be changed. Indian Airlines is 52 years. Aren't befitting perpetual marketing efforts supposed to keep a brand contemporary, ever? Four, even a bad name that rises to become a brand should not be changed. Some luck with IA, the market for air travel is not complex, yet. And, five, name of a brand that's on attack and yielding must not be changed - - certainly not, when quite a few competitors are on the rise. From being a lone server, Indian airlines has given away market shares in chunks to slip to position 3 - - and became an Indian!! Clearly, Indian Airlines didn't have a chance to change.

Mistakes in re-naming a brand result in marketing difficulties. Indian, when it was Indian Airlines enjoyed certain brand equity while all alone and once set against competition it has been on a free fall. With that already set in the mind, typical customer response on this name-change can be; "flying fast into the past". And that perception could possibly stick and eventually may turn true too. As ever, a mistake proves to be one only in time. It is hard flying with Indian as the name. It is evident every time I read the advertisements and news on Indian.

ADAG had a compelling need for not adopting Reliance. Sense of ownership, fear of loss of invaluable identity and brand power led to the christening of Anil's Reliance against the ignored possibility of creating a far superior and progressive brand power with a different name. Indian airlines didn't have a need to change its flawless name. Misplaced conviction that it could turn its image to one of being a 'smart aggressor' from that of a 'passive looser', by changing the name led to the retirement of a very worthy name for an inapt one.

17 November 2006

Copyright: Adve Srinivasa Bhat, India.