Rebranding
Encyclopedia
Rebranding is the creation of a new name, term, symbol, design, or a combination of them for an established brand with the intention of developing a differentiated (new) position in the mind of stakeholders and competitors.

Far from just a change of visual identity, rebranding should be part of an overall brand strategy for a product or service.

This may involve radical changes to the brand's logo, brand name, image, marketing strategy, and advertising
Advertising
Advertising is a form of communication used to persuade an audience to take some action with respect to products, ideas, or services. Most commonly, the desired result is to drive consumer behavior with respect to a commercial offering, although political and ideological advertising is also common...

 themes. These changes are typically aimed at the repositioning
Positioning (marketing)
In marketing, positioning has come to mean the process by which marketers try to create an image or identity in the minds of their target market for its product, brand, or organization....

 of the brand/company, sometimes in an attempt to distance itself from certain negative connotations of the previous branding, or to move the brand upmarket. However, the main reason for a re-brand is to communicate a new message for a company, something that has evolved, or the new board of directors wish to communicate.

Rebranding can be applied to new products, mature products, or even products still in development. The process can occur intentionally through a deliberate change in strategy or occur unintentionally from unplanned, emergent situations, such as a "Chapter 11
Chapter 11, Title 11, United States Code
Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most...

 corporate restructuring," "union busting
Union busting
Union busting is a wide range of activities undertaken by employers, their proxies, and governments, which attempt to prevent the formation or expansion of trade unions...

," or "bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....

."

Corporate rebranding

Rebranding has become something of a fad at the turn of the millennium, with some companies rebranding several times. The rebranding of Philip Morris
Philip Morris USA
Philip Morris USA is the United States tobacco division of Altria Group, Inc. Philip Morris USA brands include Marlboro, Virginia Slims, Benson and Hedges, Merit, Parliament, Alpine, Basic, Cambridge, Bucks, Dave's, Chesterfield, Collector's Choice, Commander, English Ovals, Lark, L&M, Players and...

 to Altria
Altria Group
Altria Group, Inc. is based in Henrico County, Virginia, and is the parent company of Philip Morris USA, John Middleton, Inc., U.S. Smokeless Tobacco Company, Inc., Philip Morris Capital Corporation, and Chateau Ste. Michelle Wine Estates. It is one of the world's largest tobacco corporations...

 was done to help the company shed its negative image. Other rebrandings, such as the British Post Office
Royal Mail
Royal Mail is the government-owned postal service in the United Kingdom. Royal Mail Holdings plc owns Royal Mail Group Limited, which in turn operates the brands Royal Mail and Parcelforce Worldwide...

's attempt to rebrand itself as Consignia, have proved such a failure that millions more had to be spent going back to square one.

In a study of 165 cases of rebranding, Muzellec and Lambkin (2006) found that, whether a rebranding follows from corporate strategy (e.g., M&A) or constitutes the actual marketing strategy (change the corporate reputation), it aims at enhancing, regaining, transferring, and/or recreating the corporate brand equity.

According to Sinclair (1999:13), business the world over acknowledges the value of brands. “Brands, it seems, alongside ownership of copyright and trademarks, computer software and specialist know-how, are now at the heart of the intangible value investors place on companies.” As such, companies in the 21st century may find it necessary to relook their brand in terms of its relevancy to consumers and the changing marketplace. Successful rebranding projects can yield a brand better off than before.

Due to the tremendous impact that renaming and rebranding a company can have, it is critical to take the client through the process with great sensitivity and care. The new company identity and brand should also be launched in a subtle and methodical manner in order to avoid alienating old customers, while aiming to attract new business prospects. There is no magic formula. However, there is a methodical process that involves careful strategy, memorable visuals and personal interactions, all of which must speak in unison for a customer to place full trust and invest their emotions in what is on offer.

Marketing develops the awareness and associations in consumer memory so that customers know (and are constantly reminded) which brands best serve their needs. Once in a lead position, it is marketing, consistent product or service quality, sensible pricing and effective distribution that will keep the brand ahead of the pack and provide value to its owners (Sinclair, 1999:15).

Potential reasons for corporate rebranding

Corporations often rebrand in order to respond to external and/or internal issues. Firms commonly have rebranding cycles in order to stay current with the times or set themselves ahead of the competition. Companies also utilize rebranding as an effective marketing tool to hide malpractices of the past, thereby shedding negative connotations that could potentially affect profitability.

Corporations such as Citigroup
Citigroup
Citigroup Inc. or Citi is an American multinational financial services corporation headquartered in Manhattan, New York City, New York, United States. Citigroup was formed from one of the world's largest mergers in history by combining the banking giant Citicorp and financial conglomerate...

, AOL
AOL
AOL Inc. is an American global Internet services and media company. AOL is headquartered at 770 Broadway in New York. Founded in 1983 as Control Video Corporation, it has franchised its services to companies in several nations around the world or set up international versions of its services...

, American Express
American Express
American Express Company or AmEx, is an American multinational financial services corporation headquartered in Three World Financial Center, Manhattan, New York City, New York, United States. Founded in 1850, it is one of the 30 components of the Dow Jones Industrial Average. The company is best...

, and Goldman Sachs
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational bulge bracket investment banking and securities firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients...

 all utilize third-party vendors such as Lippincott
Lippincott
Lippincott is a consulting firm that primarily deals with brand strategy and the development of corporate identities. The firm was founded in 1943 by J. Gordon Lippincott and Walter P. Margulies as Lippincott & Margulies....

 that specialize in brand strategy and the development of corporate identity. Companies invest valuable resources into rebranding and third-party vendors because it is a way to protect them from being blackballed by customers in a very competitive market. Dr. Roger Sinclair, a leading expert on brand valuation and brand equity practice worldwide stated, “A brand is a resource acquired by an enterprise that generates future economic benefits.” Once a brand has negative connotations associated with it, it can only lead to decreased profitability and possibly complete corporate failure.

Rebranding due to a need to differentiate from competitors

Companies differentiate themselves from competitors by incorporating practices from changing their logo to going green. Differentiating from competitors is important in order to attract more customers and an effective way to draw in more desirable employees. The need to differentiate is especially prevalent in saturated markets such as the financial services industry.

Rebranding a company’s brand image should be supported by tangible actions to give substance to the message: otherwise, the company is not delivering on its promise. As explained in Kreative Rebranding, a book by Montreal-based rebranding agency Les Kréateurs: “Concrete actions allow you to distinguish yourself from competitors that don’t walk the talk.”

Rebranding due to a need to shed a negative image

Firms rebrand intentionally to shed negative images of the past. In a corporate sense, rebranding can be utilized as an effective marketing strategy to hide malpractices and avoid or shed negative connotations, and decreased profitability. Corporations such as Philip Morris USA
Philip Morris USA
Philip Morris USA is the United States tobacco division of Altria Group, Inc. Philip Morris USA brands include Marlboro, Virginia Slims, Benson and Hedges, Merit, Parliament, Alpine, Basic, Cambridge, Bucks, Dave's, Chesterfield, Collector's Choice, Commander, English Ovals, Lark, L&M, Players and...

, Blackwater and AIG
AIG
AIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...

 rebranded in order to shed negative images. Philip Morris USA
Philip Morris USA
Philip Morris USA is the United States tobacco division of Altria Group, Inc. Philip Morris USA brands include Marlboro, Virginia Slims, Benson and Hedges, Merit, Parliament, Alpine, Basic, Cambridge, Bucks, Dave's, Chesterfield, Collector's Choice, Commander, English Ovals, Lark, L&M, Players and...

 rebranded its name and logo to Altria on January 27, 2003 due to the negative connotations associated with tobacco products that could have had potential to affect the profitability of other Philip Morris brands such as Kraft Foods
Kraft Foods
Kraft Foods Inc. is an American confectionery, food and beverage conglomerate. It markets many brands in more than 170 countries. 12 of its brands annually earn more than $1 billion worldwide: Cadbury, Jacobs, Kraft, LU, Maxwell House, Milka, Nabisco, Oscar Mayer, Philadelphia, Trident, Tang...

.
Before Rebranding After Rebranding


In 2008, AIG
AIG
AIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...

’s image was damaged due to its need for a Federal bailout during the financial crisis. AIG
AIG
AIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...

 was bailed out because the United States Treasury stated that AIG
AIG
AIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...

 was too big to fail due to its size and complex relationships with financial counterparties. AIG
AIG
AIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...

 itself is a huge international firm; however, the AIG Retirement
AIG Retirement
Founded in 1955 as The Variable Annuity Life Insurance Company of America, Incorporated, located in Washington, D.C., VALIC was reorganized in the State of Texas in 1968. On November 5, 1968, the company name was changed to The Variable Annuity Life Insurance Company . VALIC has more than half a...

 and AIG Financial subsidiaries were left with negative connotations due to the bailout. As a result, AIG Financial Advisors and AIG Retirement rebranded into Sagepoint Financial and VALIC (Variable Annuity Life Insurance Company) respectively to shed the negative image associated with AIG.

Rebranding due to emergent situations

Rebranding may also occur unintentionally from emergent situations such as “Chapter 11 corporate restructuring,” or “bankruptcy.” Chapter 11 is rehabilitation or reorganization used primarily by business debtors. It’s more commonly known as corporate bankruptcy, which is a form of corporate financial reorganization that allows companies to function while they pay of their debt. Companies such as Lehman Brothers
Lehman Brothers
Lehman Brothers Holdings Inc. was a global financial services firm. Before declaring bankruptcy in 2008, Lehman was the fourth largest investment bank in the USA , doing business in investment banking, equity and fixed-income sales and trading Lehman Brothers Holdings Inc. (former NYSE ticker...

 Holdings Inc, Washington Mutual
Washington Mutual
Washington Mutual, Inc. , abbreviated to WaMu, was a savings bank holding company and the former owner of Washington Mutual Bank, which was the United States' largest savings and loan association until its collapse in 2008....

 and General Motors
General Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...

 have all filed for Chapter 11 bankruptcy.New Generation Research - Experts in Bankruptcy Research

On July 1, 2009 General Motors
General Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...

 filed for bankruptcy, which was fulfilled on July 10, 2009. General Motors
General Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...

 decided to rebrand its entire structure by investing more in Chevrolet
Chevrolet
Chevrolet , also known as Chevy , is a brand of vehicle produced by General Motors Company . Founded by Louis Chevrolet and ousted GM founder William C. Durant on November 3, 1911, General Motors acquired Chevrolet in 1918...

, Buick
Buick
Buick is a premium brand of General Motors . Buick models are sold in the United States, Canada, Mexico, China, Taiwan, and Israel, with China being its largest market. Buick holds the distinction as the oldest active American make...

, GMC
GMC
GMC may refer to:* Ganglion mother cell, a cell in the developing nervous system that divides once to produce two neurons* General motion control, a field of motion control concerned with single- and multi-axis motion controllers, intelligent drives, servo and stepper motors* Generalized Method of...

, and Cadillac
Cadillac
Cadillac is an American luxury vehicle marque owned by General Motors . Cadillac vehicles are sold in over 50 countries and territories, but mostly in North America. Cadillac is currently the second oldest American automobile manufacturer behind fellow GM marque Buick and is among the oldest...

 automobiles. Furthermore, it decided to sell Saab
Saab
Saab AB is a Swedish aerospace and defence company, founded in 1937. From 1947 to 1990 it was the parent company of automobile manufacturer Saab Automobile, and between 1968 and 1995 the company was in a merger with commercial vehicle manufacturer Scania, known as Saab-Scania.-History:"Svenska...

 Automobile and discontinue the Hummer
Hummer
Hummer was a brand of trucks and SUVs, first marketed in 1992 when AM General began selling a civilian version of the M998 Humvee. In 1998, General Motors purchased the brand name and marketed three vehicles: the original Hummer H1, based on the Humvee; and the H2 and H3 models that were...

, Pontiac
Pontiac
Pontiac was an automobile brand that was established in 1926 as a companion make for General Motors' Oakland. Quickly overtaking its parent in popularity, it supplanted the Oakland brand entirely by 1933 and, for most of its life, became a companion make for Chevrolet. Pontiac was sold in the...

, and Saturn
Saturn
Saturn is the sixth planet from the Sun and the second largest planet in the Solar System, after Jupiter. Saturn is named after the Roman god Saturn, equated to the Greek Cronus , the Babylonian Ninurta and the Hindu Shani. Saturn's astronomical symbol represents the Roman god's sickle.Saturn,...

 brands. General Motors
General Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...

 rebranded by stating they are reinventing and rebirthing the company as “The New GM” with “Fewer, stronger brands. Fewer, stronger models. Greater efficiencies, better fuel economy, and new technologies” as stated in their reinvention commercial. General Motors
General Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...

' reinvention commercial also stated that eliminating brands “isn’t about going out of business, but getting down to business.”

Product rebranding

As for product offerings, when they are marketed separately to several target markets this is called market segmentation. When part of a market segmentation strategy involves offering significantly different products in each market, this is called product differentiation
Product differentiation
In economics and marketing, product differentiation is the process of distinguishing a product or offering from others, to make it more attractive to a particular target market. This involves differentiating it from competitors' products as well as a firm's own product offerings...

. This market segmentation/product differentiation process can be thought of as a form of rebranding. What distinguishes it from other forms of rebranding is that the process does not entail the elimination of the original brand image. Dexxa computer mice
Mouse (computing)
In computing, a mouse is a pointing device that functions by detecting two-dimensional motion relative to its supporting surface. Physically, a mouse consists of an object held under one of the user's hands, with one or more buttons...

 are rebranded Logitech
Logitech
Logitech International S.A. is a global provider of personal peripherals for computers and other digital platforms headquartered in Romanel-sur-Morges, Switzerland. The company develops and markets products like peripheral devices for PCs, including keyboards, mice, microphones, game controllers...

 devices sold at a lower price by Logitech in the low-end market segment without undercutting their mid-range products. Rebranding in this manner allows one set of engineering and QA to be used to create multiple products with minimal modifications and additional expense.

Following a merger or acquisition, companies usually rebrand newly acquired products to keep them consistent with an existing product line. For example, when Symantec
Symantec
Symantec Corporation is the largest maker of security software for computers. The company is headquartered in Mountain View, California, and is a Fortune 500 company and a member of the S&P 500 stock market index.-History:...

 acquired Quarterdeck
Quarterdeck Office Systems
Quarterdeck Office Systems, later Quarterdeck Corporation , was an American computer software company. It was founded by Therese Myers and Gary Pope in 1981and incorporated in 1982...

 in November 1998, Symantec chose to rename CleanSweep
Quarterdeck Cleansweep
Norton CleanSweep, designed by Quarterdeck was designed to aid in the removal of installed programs.CleanSweep was acquired by Symantec, and sold as a standalone product for a period of time...

 to Norton CleanSweep. Later on, the company chose to reposition its entire product line by grouping products into a bundle known as Norton SystemWorks
Norton Utilities
Norton Utilities is a utility software suite designed to help analyze, configure, optimize and maintain the computer. The current version 15 of Norton Utilities Premier Edition for Windows XP/Vista/7 was released December 27, 2010....

. Symantec is not the only software company to reposition and rebrand its products. Much of Microsoft
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...

's product line consists of rebranded products, including MS-DOS
MS-DOS
MS-DOS is an operating system for x86-based personal computers. It was the most commonly used member of the DOS family of operating systems, and was the main operating system for IBM PC compatible personal computers during the 1980s to the mid 1990s, until it was gradually superseded by operating...

, FoxPro
FoxPro
' has two meanings:*Visual FoxPro, an object-oriented programming language and RDBMS, published by Microsoft, for Microsoft Windows*FoxPro 2, a text-based procedural programming language and DBMS, originally published by Fox Software and later by Microsoft, for MS-DOS, Microsoft Windows, Macintosh,...

, and Visio
Microsoft Visio
Microsoft Visio , formerly known as Microsoft Office Visio, is a commercial diagramming program for Microsoft Windows that uses vector graphics to create diagrams.- Features :...

. Another example is the rebrands of GeForce 8-series GPU into 9-series by nVidia. The reverse can also happen, as when AlliedSignal
AlliedSignal
AlliedSignal was an aerospace, automotive and engineering company that acquired and merged with Honeywell for $15 billion in 1999, after which the new group adopted the Honeywell name.AlliedSignal was created through a 1985 merger of Allied Corp...

 acquired Honeywell
Honeywell
Honeywell International, Inc. is a major conglomerate company that produces a variety of consumer products, engineering services, and aerospace systems for a wide variety of customers, from private consumers to major corporations and governments....

, Southern Railroad of Long Island
Southern Railroad of Long Island
The South Side Railroad of Long Island was a railroad company in the U.S. state of New York. Chartered in 1860 and first opened in 1867 as a competitor to the Long Island Rail Road, it was reorganized in 1874 as the Southern Railroad of Long Island and leased in 1876 to the LIRR...

 acquired Long Island Rail Road
Long Island Rail Road
The Long Island Rail Road or LIRR is a commuter rail system serving the length of Long Island, New York. It is the busiest commuter railroad in North America, serving about 81.5 million passengers each year. Established in 1834 and having operated continuously since then, it is the oldest US...

, and Chemical Bank acquired Chase Manhattan Bank
Chase Manhattan Bank
JPMorgan Chase Bank, N.A., doing business as Chase, is a national bank that constitutes the consumer and commercial banking subsidiary of financial services firm JPMorgan Chase. The bank was known as Chase Manhattan Bank until it merged with J.P. Morgan & Co. in 2000...

. In such cases, the acquiring company rebrands itself with the acquired name.

Another form of product rebranding is the sale of a product manufactured by another company under a new name. An original design manufacturer
Original Design Manufacturer
An original design manufacturer is a company which designs and manufactures a product which is specified and eventually branded by another firm for sale. Such companies allow the brand firm to produce without having to engage in the organization or running of a factory...

is a company that manufactures a product that is eventually branded by another firm for sale. This is often the case with international trade. A product is manufactured in a place with lower operating costs, and sold under a local brand name.

Small business rebranding

Small businesses face different challenges from large corporations and must adapt their rebranding strategy accordingly.

Rather than implementing change gradually, small businesses are sometimes better served by rebranding their image in a short timeframe – especially when existing brand notoriety is low. “The powerful first impression on new clients made possible by professional brand design often outweighs an outdated or poorly-designed image’s weak brand recognition to existing clients”.

A change of image in a large corporation can have costly repercussions (updating signage in multiple locations, large quantities of existing collateral, communicating with a large number of employees, etc.), while small businesses can enjoy more mobility and implement change more quickly.

While small businesses can experience growth without necessarily having a professionally designed brand image, “rebranding becomes a critical step for a company to be considered seriously when expanding to more aggressive markets and facing competitors with more established brand images”.
The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
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