Is a name change the best way out of a crisis?
From Dreamworld to Samsung, in this guest post, Principals director, Sandy Belford, discusses the case for and against companies changing their names following a public crisis.
When a brand finds itself in the midst of a crisis, there are numerous ways to get past it. One of the more drastic is a name change.
Changing identity is one thing, but when you change a brand name you’re basically saying the business is becoming something different. It is the most extreme thing you can do to signal a major shift in who you are and what you do.
As long as you actually deliver something different, a name change is an effective way of moving beyond a crisis. However, if you are just trying to look different and not fundamentally changing what you offer or how you offer it, that’s another story altogether. If you are changing name to make it look as if you’re changing, when you haven’t, that’s a problem.
Many commentators are far too quick to call for a name change in the wake of a reputational crisis. There was widespread speculation (especially in the USA) that Toyota would have to change its name after their massive car recall, but within a year they had regained their position as the worlds biggest automaker Similarly so-called experts said Malaysian Airlines would have to change its name after its twin disasters. But again they were wrong and the airline is slowly recovering its position. As Sandy Belford rightly says, a name change post-crisis needs to be for very clear strategic reasons, not just a knee-jerk reaction.
It’s a balance between:
1. Brand name reach and equity (how long it’s been around and how many people know the brand).
2. How complicit the brand was in the event.