Emotion and poor research frequently drive company name changes more than good business decisions. KFC (Kentucky Fried Chicken), DQ (Dairy Queen) and IHOP (International House of Pancakes) all decided to go with what they thought people already called them (employees, management and regular customers naturally shorten long names simply to facilitate easy daily communication). But by listening just to themselves, these three removed any vestige of appetite appeal, uniqueness or personality (KFC, DQ and IHOP would be better names for gas stations or utilities than places to eat). Successful businesses look to make changes that will appeal to NEW customers -- current ones are already loyal and will stay that way if they aren't offended. Management is the least qualified to evaluate a new name because they're too invested, knowledgeable and biased.
Evaluating potential new names with focus groups is also a poor way to make decisions -- focus groups collect OPINIONS in a thoughtful, social, uncomfortable environment and do not measure BEHAVIOR (ask a focus group what's wrong with television and they'll emphatically tell you there's too much sex and violence -- let that information guide your programming and you'll wonder where your audience went!). Why? Because opinion rarely matches behavior. Measuring behavior has to be done indirectly and with a broad enough sample to be useful. Then, the questions have to be meaningful ("which of these two names do you like the best?" is irrelevant. "which of these two restaurants would you rather eat at?" starts to measure behavior). For example, I'm sure a blind research study of potential customers asking who would have better food; "CPK" or "California Pizza Kitchen" would reveal the limitations of the word Pizza in the name are a lot less than the penalties of turning the brand into an acronym (what all three aforementioned brands did).
"The Shack" is another misguided effort to get rid of "Radio" (it isn't about radios anymore -- it isn't a shack either). The name should have been changed fifteen years ago when Landor changed the identity to the circle R thing. But I'm sure executives yelled "Oh, no. We have enormous recognition and equity!" Yes. They do. Only problem is WHAT that equity is in. Bernie Madoff has recognition and equity, but I wouldn't want him as a spokesperson for my brand. His IMAGE is a negative and makes the recognition a liability. Radio Shack needs to rediscover their appeal and craft a new image that reinforces those virtues. A complete name change will have a short term price, but benefit more in the long term. (In 1998 I was involved in changing Budgetel Inns to Baymont to head off an increasing decline in business. For the first six months under the new name losses increased, but within a year revenues and profits significantly exceeded where they would have been had no change been made).
The same with UPS brown. Recognition? Yep. Image? Sure, if you like the postal delivery system of the government circa 1945. Park a FedEx truck and a UPS truck in front of your building and ask yourself which one will get your package there quicker, easier and more consistently? I feel sorry for the ad agency who had to run the campaign "What can brown do for you today?" Yuck! (as I understand it from the former chairman of UPS, they actually have a much better on-time record than FedEx, but I have to stretch to believe it based on brand imagery).
How about Kinko's becoming FedEx Office? Yes, Kinko's is a funky name. Yes, FedEx is a great name. FedEx/Kinko's was weird. But FedEx office is where I'd check on my packages and complain about services. Not where I'd expect to get a wide range of fast, economical printing services to supplement my desktop abilities. Is this management talking to themselves again?
Evaluating potential new names with focus groups is also a poor way to make decisions -- focus groups collect OPINIONS in a thoughtful, social, uncomfortable environment and do not measure BEHAVIOR (ask a focus group what's wrong with television and they'll emphatically tell you there's too much sex and violence -- let that information guide your programming and you'll wonder where your audience went!). Why? Because opinion rarely matches behavior. Measuring behavior has to be done indirectly and with a broad enough sample to be useful. Then, the questions have to be meaningful ("which of these two names do you like the best?" is irrelevant. "which of these two restaurants would you rather eat at?" starts to measure behavior). For example, I'm sure a blind research study of potential customers asking who would have better food; "CPK" or "California Pizza Kitchen" would reveal the limitations of the word Pizza in the name are a lot less than the penalties of turning the brand into an acronym (what all three aforementioned brands did).
"The Shack" is another misguided effort to get rid of "Radio" (it isn't about radios anymore -- it isn't a shack either). The name should have been changed fifteen years ago when Landor changed the identity to the circle R thing. But I'm sure executives yelled "Oh, no. We have enormous recognition and equity!" Yes. They do. Only problem is WHAT that equity is in. Bernie Madoff has recognition and equity, but I wouldn't want him as a spokesperson for my brand. His IMAGE is a negative and makes the recognition a liability. Radio Shack needs to rediscover their appeal and craft a new image that reinforces those virtues. A complete name change will have a short term price, but benefit more in the long term. (In 1998 I was involved in changing Budgetel Inns to Baymont to head off an increasing decline in business. For the first six months under the new name losses increased, but within a year revenues and profits significantly exceeded where they would have been had no change been made).
The same with UPS brown. Recognition? Yep. Image? Sure, if you like the postal delivery system of the government circa 1945. Park a FedEx truck and a UPS truck in front of your building and ask yourself which one will get your package there quicker, easier and more consistently? I feel sorry for the ad agency who had to run the campaign "What can brown do for you today?" Yuck! (as I understand it from the former chairman of UPS, they actually have a much better on-time record than FedEx, but I have to stretch to believe it based on brand imagery).
How about Kinko's becoming FedEx Office? Yes, Kinko's is a funky name. Yes, FedEx is a great name. FedEx/Kinko's was weird. But FedEx office is where I'd check on my packages and complain about services. Not where I'd expect to get a wide range of fast, economical printing services to supplement my desktop abilities. Is this management talking to themselves again?