Want To Avoid The Need To Rebrand? Find Out The Pitfalls Before You Choose A Name
Picking a name for your business isn’t always straightforward.
An obvious first step for entrepreneurs embarking on a naming project is to pick some names and do a search engine check to assess whether anyone else is using the name. If there’s no sign of a domain with that name, that might mean no one else is using the name, but not necessarily.
Unfortunately, too many business owners fall into the trap of not doing any further checks. They secure the domain name of their choice, and set about commissioning logo designs and business cards.
With almost 130 million .com domains and nearly 11 million .uk domains in use, it’s fair nowadays to assume that most brands have an internet presence – but that’s not always the case. Also, if a brand name is being used as a product name, it may not necessarily show up in the search engines. Alternatively, someone may have registered the name pending creation of a new brand.
The Problem With Not Doing Adequate Checks
The real problems come when an eager business owner doesn’t commission professional searches and just adopts the name, whether or not they file an application for a trademark.
All too often, time and money has to be written off when the inevitable cease and desist letter arrives because someone else has a better claim to the name.
Worse, this can all happen years later. Someone who owns a conflicting trade mark doesn’t have to oppose your application at the time you submit it, and if they simply haven’t registered their trademark you would have a messy passing off dispute on your hands.
(When you see the ™ symbol, it means the business owner is claiming trademark rights in the name. It doesn’t necessarily mean the name is capable of being trademarked, or that they haven’t trademarked it yet. They may simply have not changed the symbol to ® to indicate the mark is registered.)
You might have traded happily for a few years, building up significant goodwill and reputation in your brand name… only to find you have to rebrand. So, it’s a false economy to not.
The Thinking Behind Rebranding
A trademark conflict is only one reason why a business might need to rebrand.
Another common reason is when a business has a name that is too descriptive to qualify for trade mark protection. That’s because a brand name must be sufficiently distinctive to qualify as a trade mark.
Two big rebrands many of us remember were when British Telecom became BT and Norwich Union evolved into Aviva. There are countless other examples, including BNI (formerly Business Network International) and HSBC (formerly, Hong Kong and Shanghai Bank).
A look at Interbrand’s Best Global Brands report demonstrates that every company has to have a distinctive name or – like IBM, HSBC and KFC – use initials that originally began as a descriptive name.
But even opting for initials doesn’t always work.
In 2000 the World Wide Fund for Nature (“WWF” to most Britons) sued the owners of the World Wrestling Federation (“WWF” to most Americans) for trade mark infringement – and won.
In 2002, the men in tights therefore rebranded as “WWE”, the World Wrestling Entertainment – and even had to give up the WWF.com domain.
With the spread of globalisation, another common reason for rebranding is to have a consistent brand internationally.
So, while many Brits still think of them as Opal Fruits, Marathon bars and Jif floor cleaner, their names were changed to the globally-used Starburst, Snickers and Cif.
And sometimes it proves necessary to rebrand to shake off negative associations with a previous name.
Entire towns and cities have rebranded for this reason – Windscale in Cumbria became Sellafield in 1981, while Bombay in India became Mumbai in 1995.
However, rebranding in this way doesn’t always work. Ask Gerald Ratner.
After the CEO of the Ratner jewellery chain was recorded in 1992 describing the jewellery sold in his stores as “total crap” and unfavourably comparing the company’s earrings with a 99p prawn sandwich, £500 million was wiped off the company’s value and 300 of its stores closed after customers gave the Ratner brand the cold shoulder. In 1993 the Ratner Group rebranded as Signet and moved its HQ from the UK to America. Signet, however, died a retail death in Britain and the group’s stores quickly rebranded to the existing H Samuel, Leslie Davis and Ernest Jones brands that remained largely untainted by Mr. Ratner’s words.
Rebranding – whether forced or voluntary – is not without risks, quite part from the costs.
Before you make a change, think about the following:
- Consult your customers first
Customers often don’t like name or logo changes. When Gap redesigned its logo in 2010, it was unprepared for extreme backlash its new logo evoked. Twitter exploded and more than 2,000 comments were posted on the company’s Facebook page, mostly demanding the return of the traditional logo. The online outcry led to Gap scrapping its very expensive new logo after less than a week, saying “the company’s customers always come first”.
- Check the translation
We live in the age of globalisation. If you sell your goods or services abroad, you need to think about what your brand name means in the native languages in your overseas markets. Some brand names are ill-advised because they have unintentionally unfortunate – and sometimes hilarious – connotations. A name like Pocari Sweat means it’s unlikely that particular Japanese sports drink will ever make much headway in the USA or Britain.
- Don’t act in haste
If you have to rebrand because of a trade mark conflict, don’t panic and trip yourself up by acting too quickly. See if you can negotiate a little extra time so you have some breathing space to run down existing stocks and to choose the right new name.
- Timing is everything
If you decide to rebrand, the best time to do so is once your business concept is proven and you know your business is viable. It’s not a good idea to continue with a descriptive name beyond that point as doing so will hold your business back in the long run.
Customers and clients identify and choose products and services by name. It’s therefore important to build up recognition in your name as early as possible, otherwise your business may miss out on the potential to increase revenue and all the earlier goodwill generated may be lost.
Conclusion
It’s important to think about choosing a relevant and distinctive brand name in the very early stages of planning a business.
A well-considered name can be an important factor in building a valuable, successful business – and it can save you a lot of money and effort that is needed to rebrand at a later stage.
If you’re thinking about names for your business idea and want expert advice on trade marks and branding, do get in touch.
