The Press, August 2006

"Going the extra smile" is the theme of local company AMI Insurance's current advertising. The slick campaign is part of a major 'rebranding' project to help AMI stand out in a highly competitive sector. What is rebranding and is it a good marketing tactic?

'Rebranding' typically describes the process of developing a new logo, corporate font and colours, new messages or even a new name. Companies choose to rebrand for all kinds of reasons. Sometimes it is out of necessity, because of ownership changes, mergers or acquisitions. Sometimes it is driven by a desire to polish an image or change a perception.

The answer to whether or not a rebranding is worthwhile is the same as any marketing question - it lies with the customer. Organisations get rebranding wrong when it is internally driven rather than a response to a customer need.

Several years ago Christchurch computer company Aoraki Corporation rebranded itself as Jade Software Corporation. This represented a consolidation of a confusing collection of brands and sub-brands including Aoraki, Cardinal and Jade. Choosing a single corporate brand made it much easier for customers to understand and remember who Jade was and what they stood for.

Companies also have to move with the times. Classic brands like Shell have changed visually quite a lot over the years, but only in an evolutionary way to meet with the changing times, to stay modern and relevant to their customers. ASB Bank made a major investment in updating its visual identity last year but did so with little fanfare.

Without a good customer justification, screaming from the rooftops about a new 'brand' is likely to invite cynicism from customers, shareholders and the media. National MP Murray McCully recently lambasted the crown research institute formerly known as Geological and Nuclear Sciences Limited for rebranding as GNS Science. "GNS has chewed up over $75,000 on PR advisors, design consultants and 'consultation with sub-brand champions'."

"We've modernised our logo to succinctly encapsulate our values and capabilities," GNS CEO Dr Alex Malahoff is quoted as saying. "The stronger visual identity will make us recognisable as the major organisation in New Zealand focused on a broad spectrum of sciences from earth sciences to isotope technologies." Really? How does a new name and fancy logo achieve this objective? Wouldn't it have been better to spend the $75,000 educating New Zealanders about the role of Geological and Nuclear Sciences Limited instead?

Rebranding disasters are typically the result of a fundamental misunderstanding of brands. A brand is not just superficial elements like logos and colours, but all of the experiences customers have with a company and its product.

An analogy is clothing. Most of us pay some degree of attention to the way we dress. It is an expression of ourselves and helps others build a perception of us. But not many of us would believe that a change of wardrobe would transform perceptions held by people who know and deal with us regularly.

Company branding in the purely visual sense (logos, colours etc) is very similar. A logo, stationery, signage etc is the company's "clothing." It helps create impressions with customers and potential customers. But it is very much a superficial aspect of marketing - no matter how impressive your corporate wardrobe it won't mask poor customer experiences.

The tragedy with some rebrandings is that organizations lose any positives they have built amongst customers with the previous brand. Often they are addressing the superficial (logo, stationery) instead of the substantive (product quality, service) which can be the real problem.

To return to the AMI example, it has launched an aggressive 'rebranding' campaign. It has refreshed its logo and general look, as well carrying out a significant advertising campaign to promote the 'smile' logo. It is trying to position its brand strongly around service, differentiating itself as the most 'customer-friendly' insurance company.

The logo looks fresh and modern, the campaign is clear and positive, but is the rebranding project a success? The only real test is whether AMI deliver on that promise of superior customer service when you next call, visit an office or logon to their website.

What steps need to be taken when considering a rebranding?

  1. The customer - you can't even consider a rebranding without a clear idea of who your customers are and their needs.
  2. The problem - ensure there is an external rationale for the change.
  3. The purpose - if a rebranding is justified, decide what promise your brand should make to the customer and how you can deliver on this.
  4. Implementation - plan exhaustively to ensure the changes are applied across all points of your company that the customer touches, and that your own staff understand and support the change.

Rebranding is a risky business. Without a strong rationale it could well cause more trouble for your brand than add value. If it is driven from a clear customer need it is much more likely to be appropriate, and less like the Emperor's New Clothes.

Subscribe to our blog