Rebranding 'can be waste of time'

Companies can be wasting both time and money if they just change their name to re-brand themselves, according to a marketing expert.

A corporate name change has to go in tandem with a change of identity, or it can be an expensive waste of time, says Tom Blackett, deputy chairman of Interbrand.

Rebranding is often perceived as a cynical attempt by a company to boost its share price or shrug off the past.

Windscale, the home of a famous British nuclear power installation tried to leave behind its accident-prone past by changing its name to Sellafield.

British water companies tried to transform themselves into dynamic service businesses and adopted names such as Kelda and Hyder.

Diageo has improved following a pedestrian performance immediately after the merger of Guinness and Grand Metropolitan that created it. But Corus has been dogged by the same problems as when it was British Steel. High-profile rebrands throughout 2001 included the Royal Mail, which became Consignia, and BT Cellnet, which became mmO2.

Customers are often baffled by the thinking behind a new moniker.

When Thus decided to write its name in capitals, the following explanation was posted on the company's intranet site: "A business decision has been taken to write the word THUS in capitals in all written forms to capture and replicate our value which encourages our employees and our business to 'Act with boldness, simplicity and speed."

Mr Blackett said: "A company will never rebrand purely to salvage its share price, a merger or acquisition or shift in the business has to spark a corporate name change.

"Rebrands are often perceived as a cynical exercise to fool the poor old consumers, but the reality is that it is an expensive process that requires a great deal of deliberation."