Say Goodbye to Merrill Lynch, Weight Watchers, and the Gap
The 3 Dangers of a Rebrand
Weight Watchers took a big bite out of the rebranding bug last September when it decided to change its name to WW. Apparently, consumers weren’t hungry for this change as the weight loss company had its worst ever stock plunge last Wednesday when its shares fell a whopping 35%!
Bank of America took a momentous branding step last week too permanently dropping the name Merrill Lynch from its investment bank; the new name is BofA Securities.
And, say goodbye to “fall into the Gap,” as Old Navy will now stand as its own company and the Gap, Banana Republic, and Intermix will become a new brand.
But are there risks to a rebrand? Yes! The top 3 Risks of a Rebrand:
Customers Won’t Embrace the New Name – I’m an avid WW fan (down 22 lbs.!), but I’ve yet to say to anyone how much I revere WW. I always spell it out with Weight Watchers. Saying the acronym sounds like the start of a web address (www…) or the beginning of the World Wildlife Federation or the start of World Wresting; you get the point.
You Lose the Emotional History of the Brand – Merrill Lynch was founded in 1914. Compare the phrase “I’ve been investing in BofA Securities for 2 whole weeks” vs. “My family has put its faith in Merrill Lynch for the last 105 years.” I also fondly remember struggling to fold stacks of T-shirts at the Gap (true!) and then being euphemistically “let go.” (Sad, but also true.)
You Confuse Your Current Customers – Since we don’t yet know the Gap’s new name, how do you court them? Every rebrand requires handholding: explaining the reasoning behind the name change and the rationale for the new name. If we’re no longer falling into the Gap or we just falling for other brands?
A rebranding exercise is an expensive undertaking without a guarantee. The true equation of a rebrand is if the new name overcomes a limitation or negative perception to the marketplace and returns higher sales, loyalty, and customer satisfaction.
What’s your experience with rebrands? From Dunkin’ to simply Starbucks, do you refer to them as the new name? Please share below.