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Rebranding is a marketing strategy in which a new name, term, symbol, design, concept or combination thereof is created for an established
brand A brand is a name, term, design, symbol or any other feature that distinguishes one seller's good or service from those of other sellers. Brands are used in business, marketing, and advertising for recognition and, importantly, to create an ...
with the intention of developing a new, differentiated identity in the minds of
consumer A consumer is a person or a group who intends to order, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, who is not directly related to entrepreneurial or business activities. ...
s, investors, competitors, and other stakeholders. Often, this involves radical changes to a brand's
logo A logo (abbreviation of logotype; ) is a graphic mark, emblem, or symbol used to aid and promote public identification and recognition. It may be of an abstract or figurative design or include the text of the name it represents as in a wo ...
, name, legal names, image, marketing strategy, and
advertising Advertising is the practice and techniques employed to bring attention to a product or service. Advertising aims to put a product or service in the spotlight in hopes of drawing it attention from consumers. It is typically used to promote a ...
themes. Such changes typically aim to reposition the brand/company, occasionally to distance itself from negative
connotation A connotation is a commonly understood cultural or emotional association that any given word or phrase carries, in addition to its explicit or literal meaning, which is its denotation. A connotation is frequently described as either positive ...
s of the previous branding, or to move the brand upmarket; they may also communicate a new message a new
board of directors A board of directors (commonly referred simply as the board) is an executive committee that jointly supervises the activities of an organization, which can be either a for-profit or a nonprofit organization such as a business, nonprofit orga ...
wishes to communicate. Rebranding can be applied to new products, mature products, or even products still in development. The process can occur through a change in marketing strategy or in various other situations such as Chapter 11 corporate restructuring, union busting, or
bankruptcy Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debto ...
. Rebranding can also refer to a change in a company or corporate brand that may own several sub-brands for products or companies.


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 Phil(l)ip or Phil Morris may refer to: Companies *Altria, a conglomerate company previously known as Philip Morris Companies Inc., named after the tobacconist **Philip Morris USA, a tobacco company wholly owned by Altria Group ** Philip Morris Inte ...
to
Altria Altria Group, Inc. (previously known as Philip Morris Companies, Inc.) is an American corporation and one of the world's largest producers and marketers of tobacco, cigarettes and related products. It operates worldwide and is headquartered in ...
was done to help the company shed its negative image. Other rebrandings, such as the British Post Office'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
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 Brand equity, in marketing, is the worth of a brand in and of itself – i.e., the social value of a well-known brand name. The owner of a well-known brand name can generate more revenue simply from brand recognition, as consumers perceive the prod ...
. 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.” Companies in the 21st century may find it necessary to relook their brand in terms of its relevance to consumers and the changing marketplace. Successful rebranding projects can yield a brand better off than before. Marketing develops the awareness and associations in the memory of customers so they know (and are reminded) of brands to 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).


Motivation

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 Inc. or Citi ( stylized as citi) is an American multinational investment bank and financial services corporation headquartered in New York City. The company was formed by the merger of banking giant Citicorp and financial conglomera ...
,
AOL AOL (stylized as Aol., formerly a company known as AOL Inc. and originally known as America Online) is an American web portal and online service provider based in New York City. It is a brand marketed by the current incarnation of Yahoo! Inc. ...
,
American Express American Express Company (Amex) is an American multinational corporation, multinational corporation specialized in payment card industry, payment card services headquartered at 200 Vesey Street in the Battery Park City neighborhood of Lower Man ...
, and
Goldman Sachs Goldman Sachs () is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered at 200 West Street in Lower Manhattan, with regional headquarters in London, Warsaw, Bangalore, Ho ...
all utilize third-party vendors 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 Brand valuation is the process of estimating the total financial value of a brand. A conflict of interest exists if those who value a brand were also involved in its creation. The ISO 10668 standard specifies six key requirements for the process of ...
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.


Differentiation from competitors

Companies differentiate themselves from competitors by incorporating practices from changing their logo to going green. Differentiation 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.


Elimination of a negative image

Organisations may rebrand intentionally to shed negative images of the past. Research suggests that "concern over external perceptions of the organisation and its activities" can function as a major driver in rebranding exercises. In a corporate context, managers can utilize rebranding as an effective marketing strategy to hide malpractices and avoid or shed negative connotations and decreased profitability. Corporations such as Philip Morris USA, Blackwater and AIG rebranded in order to shed negative images. Philip Morris USA rebranded its name and logo to
Altria Altria Group, Inc. (previously known as Philip Morris Companies, Inc.) is an American corporation and one of the world's largest producers and marketers of tobacco, cigarettes and related products. It operates worldwide and is headquartered in ...
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. In 2008, AIG's image became damaged due to its need for a Federal bailout during the financial crisis. AIG was bailed out because the
United States Treasury The Department of the Treasury (USDT) is the national treasury and finance department of the federal government of the United States, where it serves as an executive department. The department oversees the Bureau of Engraving and Printing and ...
stated that AIG was too big to fail due to its size and complex relationships with financial counterparties. AIG itself is a huge international firm; however, the AIG Retirement and AIG Financial subsidiaries were left with negative connotations due to the bailout. As a result, AIG Financial Advisors and AIG Retirement respectively rebranded into Sagepoint Financial and
VALIC The Variable Annuity Life Insurance Company, or VALIC, a subsidiary of American International Group, Inc., (AIG), is an insurance corporation that specializes in tax-qualified retirement plans, supplemental tax-deferred and after-tax investments ...
(Variable Annuity Life Insurance Company) to shed the negative image associated with AIG.


Lost market share

Brands often rebrand in reaction to losing market share. In these cases, the brands have become less meaningful to target audiences and, therefore, lost share to competitors. In some cases, companies try to build on any perceived equity they believe still exists in their brand. Radio Shack, for example, rebranded itself as "the Shack" in 2008 but the rebranding never realized into an increase of market share in the retail industry. By 2017, Radio Shack had significantly reduced its physical retail presence, closing over 1,000 stores and shifted to a primarily
online retail Online shopping is a form of electronic commerce which allows consumers to directly buy goods or services from a seller over the Internet using a web browser or a mobile app. Consumers find a product of interest by visiting the website of ...
business model.


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 off their debt. Companies such as
Lehman Brothers Lehman Brothers Holdings Inc. ( ) was an American global financial services firm founded in 1847. Before filing for bankruptcy in 2008, Lehman was the fourth-largest investment bank in the United States (behind Goldman Sachs, Morgan Stanley, ...
Holdings Inc, Washington Mutual and
General Motors The General Motors Company (GM) is an American Multinational corporation, multinational Automotive industry, automotive manufacturing company headquartered in Detroit, Michigan, United States. It is the largest automaker in the United States and ...
have all filed for Chapter 11 bankruptcy. On July 1, 2009
General Motors The General Motors Company (GM) is an American Multinational corporation, multinational Automotive industry, automotive manufacturing company headquartered in Detroit, Michigan, United States. It is the largest automaker in the United States and ...
filed for bankruptcy, which was fulfilled on July 10, 2009.
General Motors The General Motors Company (GM) is an American Multinational corporation, multinational Automotive industry, automotive manufacturing company headquartered in Detroit, Michigan, United States. It is the largest automaker in the United States and ...
decided to rebrand its entire structure by investing more in
Chevrolet Chevrolet ( ), colloquially referred to as Chevy and formally the Chevrolet Motor Division of General Motors Company, is an American automobile division of the American manufacturer General Motors (GM). Louis Chevrolet (1878–1941) and ou ...
,
Buick Buick () is a division of the American automobile manufacturer General Motors (GM). Started by automotive pioneer David Dunbar Buick in 1899, it was among the first American marques of automobiles, and was the company that established General ...
, GMC, and
Cadillac The Cadillac Motor Car Division () is a division of the American automobile manufacturer General Motors (GM) that designs and builds luxury vehicles. Its major markets are the United States, Canada, and China. Cadillac models are distributed ...
automobiles. Furthermore, it decided to sell
Saab Automobile Saab Automobile AB () is a defunct car manufacturer that was founded in Sweden in 1945 when its parent company, Saab AB, began a project to design a small automobile. The first production model, the Saab 92, was launched in 1949. In 1968 the p ...
and discontinue the Hummer,
Pontiac Pontiac may refer to: *Pontiac (automobile), a car brand *Pontiac (Ottawa leader) ( – 1769), a Native American war chief Places and jurisdictions Canada *Pontiac, Quebec, a municipality ** Apostolic Vicariate of Pontiac, now the Roman Catholic D ...
, and
Saturn Saturn is the sixth planet from the Sun and the second-largest in the Solar System, after Jupiter. It is a gas giant with an average radius of about nine and a half times that of Earth. It has only one-eighth the average density of Earth; h ...
brands.
General Motors The General Motors Company (GM) is an American Multinational corporation, multinational Automotive industry, automotive manufacturing company headquartered in Detroit, Michigan, United States. It is the largest automaker in the United States and ...
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 The General Motors Company (GM) is an American Multinational corporation, multinational Automotive industry, automotive manufacturing company headquartered in Detroit, Michigan, United States. It is the largest automaker in the United States and ...
' reinvention commercial also stated that eliminating brands “isn’t about going out of business, but getting down to business.”


Product line

Companies like
Dunkin' Donuts Dunkin' Donuts LLC, also known as Dunkin' and by the initials DD, is an American multinational coffee and doughnut company, as well as a quick service restaurant. It was founded by Bill Rosenberg (1916–2002) in Quincy, Massachusetts, in ...
, Joann Fabrics, and Weight Watchers, have removed or abbreviated parts of their company names to suggest a larger product line offering than what their names solely imply. It is also used to cater to different demographics who may be interested in different products of the same industry. Depending on the name like pancake restaurant chain IHOP who were planning on rebranding to "IHOb" to suggest they offer burgers as well, there was disdain from the public for the name change so the name IHOP was still kept instead.


Staying relevant

Companies can also choose to rebrand to remain relevant to its (new) customers and stakeholders. This could occur when a company's business has changed, for example its strategic direction and industry focus, or its brand no longer fits its (new) customer base. For example, a company might rebrand so that its name works in new market it enters, for reasons of culture or language, such as to make it easier to pronounce. Rebranding is also a way to refresh an image to ensure its appeal to contemporary customers and stakeholders. What once looked fresh and relevant may no longer do so years later.


Product rebranding

As for product offerings, when they are marketed separately to several target markets this is called
market segmentation In marketing, market segmentation is the process of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as ''segments'') based on some type of shared charact ...
. When part of a market segmentation strategy involves offering significantly different products in each market, this is called product differentiation. 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. Rebranding in this manner allows one set of engineering and QA to be used to create multiple products with minimal modifications and additional expense. Another form of product rebranding is the sale of a product manufactured by another company under a new name: an
original design manufacturer An original design manufacturer is a company that designs and manufactures a product that is eventually rebranded by another firm for sale. Such companies allow the firm that owns or licenses the brand to produce products while having to engage i ...
is a company that manufactures a product, often in a location with lower operating costs, which is eventually branded by another firm for sale. Following a merger or acquisition, companies usually rebrand newly-acquired products to keep them consistent with an existing product line, such as
Symantec Symantec may refer to: *An American consumer software company now known as Gen Digital Inc. *A brand of enterprise security software purchased by Broadcom Inc. Broadcom Inc. is an American designer, developer, manufacturer and global supplier ...
placing acquired security and utility software under its Norton brand (itself an offshoot of flagship product Norton Antivirus). This can also happen in reverse if an acquired brand has wider recognition in the market than that of the purchaser, such as
Chemical Bank Chemical Bank was a bank with headquarters in New York City from 1824 until 1996. At the end of 1995, Chemical was the third-largest bank in the U.S., with about $182.9 billion in assets and more than 39,000 employees around the world. Beginning ...
taking on the
Chase Chase or CHASE may refer to: Businesses * Chase Bank, a national bank based in New York City, New York * Chase Aircraft (1943–1954), a defunct American aircraft manufacturing company * Chase Coaches, a defunct bus operator in England * Chase C ...
branding after its merger with the company.


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".


Impact of rebranding

The ubiquitous nature of a company/product brand across all customer
touch point A touchpoint can be defined as any way consumers can interact with a business organization, whether it be person-to-person, through a website, an app or any form of communication (“Touchpoint Glossary”, n.d.). When consumers come in contact ...
s makes rebranding a heavy undertaking for companies. According to the iceberg model, 80% of the impact is hidden. The level of impact of changing a brand depends on the degree to which the brand is changed. There are several elements of a brand that can be changed in a rebranding these include the name, the logo, the legal name, and the corporate identity (including visual identity and verbal identity). Changes made only to the company logo have the lowest impact (called a logo-swap), and changes made to the name, legal name, and other identity elements will touch every part of the company and can result in high costs and impact on large complex organizations. Rebranding affects not only marketing material but also digital channels, URLs, signage, clothing, and correspondence.


See also

*
Original design manufacturer An original design manufacturer is a company that designs and manufactures a product that is eventually rebranded by another firm for sale. Such companies allow the firm that owns or licenses the brand to produce products while having to engage i ...
(ODM) *
Original equipment manufacturer An original equipment manufacturer (OEM) is generally perceived as a company that produces non-aftermarket parts and equipment that may be marketed by another manufacturer. It is a common industry term recognized and used by many professional or ...
(OEM) *
Electronics manufacturing services Electronics Manufacturing Services (EMS) is a term used for companies that design, manufacture, test, distribute, and provide return/repair services for electronic components and assemblies for original equipment manufacturers (OEMs). The concept is ...
(EMS) *
Ayds Ayds (pronounced as "aids") Reducing Plan Candy is a discontinued appetite-suppressant candy that enjoyed strong sales in the 1970s and early 1980s and was originally manufactured by The Carlay Company. Flavors Ayds was available in chocolat ...
*
Brand implementation In marketing, brand implementation refers to the physical representation and consistent application of brand identity across visual and verbal media. In visual terms, this can include signage, uniforms, liveries, interior design and branded merch ...
*
Product naming Product naming is the discipline of deciding what a product will be called, and is very similar in concept and approach to the process of deciding on a name for a company or organization. Product naming is considered a critical part of the brandin ...
*
List of companies involved in the Holocaust This list includes corporations and their documented collaboration in the implementation of the Holocaust. List Gallery File:Zyklon B labels.jpg , Zyklon B used at Dachau concentration camp. "Poison Gas! Cyanide preparation to be opened ...
* List of politically motivated renamings


References

{{Reflist, 2 Brand management Marketing techniques Product management Types of branding