Sprint stays on track with its brand name

In an industry characterized by stifling indifference to branding, Sprint arrived on the telecom scene as bright as a new pin.

It was 1987. The telecommunications industry, dominated by engineers and defined by its regulated past, had thrown up Bell Atlantic Bellsouth, Southwestern Bell, USWest, Ameritech Pacific Telesis, Nynex, and thousands of names that ended in cell, com or tel.

My former Landor Colleague and mentor, John Diefenbach, delighted in telling the drollery about Telesis sounding like something you caught, and Nynex being what you rubbed on to get rid of it.

Sprint was freshly different. In a word of one syllable the name conveyed energy, speed, agility, life and the right element of out-of-category surprise that marked it out as a pioneer.

But for all its breakthrough bravado the origins of the name are much more mundane. They go all the way back to the railroads.

The Southern Pacific Railroad of San Francisco maintained an extensive microwave communications system along its rights-of-way that it used for internal communications.

In 1972, Southern Pacific Communications, a unit set up by the railroad to manage the communications business, began selling surplus system capacity to corporations, circumventing AT&T’s then-monopoly on public telephony. As regulation loosened SPC began providing long-distance telephone service in 1978.

SPC decided it needed a new name for the switched voice service and ran an internal contest. Sprint was the winning entry.  The name is derived, it is said, from the initial letters of Southern Pacific Railroad Intercontinental Network of Telecommunications.

The Southern Pacific line

While the ‘SPR’ part of the name is logical enough, an ‘Intercontinental Network of Telecommunications’ feels more than a little forced. What we have here is a backronym, I suspect, not an acronym.

Anyway, the Sprint service was born and went on to survive several corporate mergers involving GTE, Telenet, United Telecom, US Telecom, Uninet, and ISACOMM.

By 1992 Sprint had achieved national recognition, thanks in large part to Candice Bergen’s “Dime Lady” ad campaign. Its then parent, United Telecommunications, sensibly adopted the name of its long distance unit to become Sprint Corporation.

In a 2005 ‘merger-of-equals’ Sprint merged with Nextel to become Sprint Nextel. The Nextel brand withered and has all but died. It is scheduled for retirement in 2013. The Sprint brand lives on.

Last Monday, Softbank, a Japanese company, announced a $20.1 billion deal to buy about 70 percent of the company, giving the Sprint the new life it needs to fight at least a few more rounds in the telecom wars.

What word comes to mind when you think of Volvo?

Swedish? Chinese? Boring? Anything?

It is a widely accepted axiom among brand consultants that leading brands can be identified by a single word or concept. BMW, for example, owns “driving” and Mercedes-Benz owns “prestige”.

Volvo supposedly owns “safety”.

The single word theory was first propounded by Al Ries and Jack Trout in their classic 1981 book ‘Positioning: The Battle for your Mind’. Their hugely successful theory (in book-sale terms, at least) has since been handed down from father to daughter, generation to generation, and has thus passed into blogosphere folklore where it is regurgitated wholesale as an immutable tenet of brand strategy.

It gets a bit squirly in the retelling. I have seen confident assertions that the Disney brand variously owns ‘magic’, ‘fun’, ‘happiness’ or ‘family entertainment’ without an ounce of substantiation. Well, which is it?

Can a brand really be associated with a single, dominant trait or concept? More importantly, should it be?

It has to be remembered, of course, that Messrs. Ries and Trout are former admen whose simplistic brand-building notions were formulated in those far off days of the pre-Internet era when the world was a much simpler place and a single media buy could reach a majority of America’s TV audience.

But would Tony Stark drive one?

For Volvo, a rugged car built to withstand the rigors of Sweden’s weather and roads, safety was a reasonable advertising campaign “positioning” back then when safety standards were much less stringent and activist Ralph Nader was taking on the entire American automotive industry. Nader’s book, ‘Unsafe at Any Speed’, revealed that many American automobiles were shockingly unsafe.

Enter Volvo. Built like a tank, drives like a tank. But it’s safe.

When all your competition is proven to be unsafe, that’s quite a differentiator.

Buick Lacrosse: Safer than a Volvo.

Since then the world has turned several times. Technology has leveled the manufacturing playing field and vehicle safety standards are much more rigorous. According to the Insurance Institute for Highway Safety, the safest cars for 2010 are the Buick LaCrosse (large cars), Audi A3 (midsize cars), and Honda Civic 4-door model (small cars).

Where’s Volvo? Nowhere.

Perhaps in perverse vindication of the Ries/Trout theory, and much to its disadvantage, Volvo cannot get beyond the lead weight of that word safety.

Design, styling, performance, quality and brand heritage are the essential ingredients of brand building in the automotive industry today, all of which are attuned to micro-segments of the market. Safe just isn’t sexy. It’s expected. What else have you got to offer?

It’s a problem Ford tried in vain to find an answer to for more than a decade, without success. After Ford purchased the Volvo in 1999 various attempts were made to spice up the brand in the US and pitch it to a younger audience. The kids were too busy driving their Scions to notice and the brand languished, unloved and ignored, except by a declining number of die-hard aficionados.

What the Volvo brand is and what it can be is no doubt preoccupying the collective minds its new owners, China’s Zhejiang Geely Holding Group. Geely successfully marketed “the world’s cheapest car” to an emerging middle class in the country’s inland cities. Volvo represents an altogether different challenge.

Volvo’s brand heritage offers little inspiration. The name (it means “I roll” in Latin) was registered in 1911 by SKF, a Swedish manufacturer of ball bearings, for a new product line. The plan was shelved and the name was later resurrected for the construction of a vehicle for the Swedish market.

Volvo’s priapic logo, a circle with an arrow pointing diagonally upwards to the right, is an uneasy amalgam of symbolic references that includes the Swedish iron industry, Mars, the Roman God of War, and the male gender. Add a word that means ‘I roll’ and you have all the qualities you would want to avoid in a modern, luxury vehicle.

Geely has a dilemma. Safety in the Chinese market is not a compelling product attribute. For the rest of the world – a Chinese-owned brand positioned on safety? A hard sell.

The speculation is that Geely plans to sell Chinese-manufactured Volvos to rich Chinese and government and army officials, a ‘showcase’ segment currently dominated by Audi. Owned by Volkswagen, Audi is by far the No. 1 luxury vehicle brand in China. It sold 157,188 units last year, surpassing Mercedes-Benz, BMW and Lexus.

Volkswagen was the first foreign automaker to set up a joint venture in China in 1984, long before others. Today, Audi is viewed as a made-in-China luxury brand among government officials.

Can Volvo unseat Audi, the vehicle of choice for Ironman Tony Stark, the epitome of technological cool? We should not underestimate the far-sighted Chinese and their almost endearing belief in the fungibility of brands.

After Nanjing Automobile Group acquired MG, the legendary British roadster brand, it decided to change the meaning of the famous initials to help promote the brand in its new home.

The letters MG are derived from ‘Morris Garages‘, the original 1923 manufacturing home of the MG in Britain. Nanjing has proclaimed it “wants Chinese consumers to know this brand as ‘Modern Gentleman’, to see that this brand represents grace and style.”

Modern Gentleman? Even Ries and Trout could not come up with that one. Maybe there’s hope still for Volvo.

Modern Gentleman, circa 1930
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These brand tenants should be evicted

The word ‘brand’ has been so pulverized by misuse that it has become devoid of any specific meaning. It is a verbal husk from which most of the nutrition has been extracted.

As a result, other words are frequently added to it in an attempt to inject some meaning. Thus we have Brand Core, Brand DNA, Brand Insistence, Brand Momentum, Brand Physique and Brand Science, to mention just a few notable examples of the genre.

I came across a new one recently.

A presenter from a research company of international repute was earnestly discussing the “brand tenants” of a company to a group of its senior executives. No, I did not hear incorrectly; there it was emblazoned on the screen:

BRAND TENANTS.

These ‘tenants’ included words such as ‘innovative’ and ‘trusted’ with supporting verbiage. No one blinked, not an eyebrow was raised.

In search of brand tenants

It had me guessing for a while before I realized she meant ‘tenets’.

While tenet and tenant share the same root tenere (to hold) they mean totally different things. A tenant is a person that pays rent to use or occupy land or a building owned by another; a tenet is an opinion, doctrine, or principle held as being true by a person or especially by an organization (it says so in the dictionary).

Brand tenets, however wearisome the verbal concoction, makes some sense. Meanwhile, those company executives in the meeting are presumably quite content to believe they have brand tenants. Which is OK, as long as they don’t expect to collect rent from them.

Peeling the Apple

Buried in the article mentioned in the previous post [Google? What kind of name is that?] there is an inevitable reference to Apple.

In the article Paola Norambuena, who runs the naming division at Interbrand, said: “If you took the Apple name away and sold all of its other assets, they wouldn’t be worth as much”.

As with many things in the branding industry, there is an overwhelming amount of unsubstantiated received wisdom that is accepted as truth. This line of thinking about Apple seems to be a variation of a quotation, beloved by namers everywhere, which is attributed to John Stuart, former CEO of Quaker Oats. It goes something like this:

“If this business were split up, I would give you the land and bricks and mortar, and I would take the brands and trademarks, and I would fare better than you”.

This is probably so in the commodity business of breakfast cereal in which oats are oats are oats. Quaker did a great job of processing oats in their brick and mortar assets and getting them into the breakfast bowls of the nation. Apple, I would argue, is a different kettle of fish altogether.

Feb 5, 1996

Apple as a business has not always been the shining success it is today. As the BusinessWeek cover tells, the company and the brand were nearly managed into oblivion by a succession CEO misfits after Steve Jobs left Apple Computer in the mid-1990s. They viewed the business’s core product as manufacturing beige computers that fewer and fewer people wanted.

The Apple brand was rescued by Steve Jobs on his return, first through product revitalization and marketing and then by new product innovation. Today the brand is inextricably wound around the intangible capital of design, functionality, retail environments, product integration, content convergence, the Internet, marketing and the brilliance of Steve Jobs and his team.

What other assets does Apple have to sell? The company does not own its manufacturing plants. The brand is everything.

 

Time Warner’s naming twavails

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When it comes to name changes, the Time Warner organization has had more than its fair share of unfortunate miss-steps.

Time Warner’s misbegotten merger with AOL produced the behemoth ‘AOL Time Warner’ in 2000. It was a fractious marriage and the promised synergies never materialized. When Time Warner executives regained their senses and control of the company they dropped AOL from the corporate name in 2003 before finally ridding itself the business in 2009.

In this case the name was the least of Time Warner’s problems, however humiliating the unraveling may have been.

Its offspring, Time Warner Telecom, has made much heavier weather of its naming challenge.

timewarnertelecomvig

Continue reading “Time Warner’s naming twavails”

The entrepreuner’s naming trap 2: Lack of due diligence

Financial advisor Sid Blum had been running his own firm, GreenLight Fee Only Advisors, for more than three years when in April he received a threatening legal letter from Greenlight Capital Inc., the hedge fund led by legendary short-seller David Einhorn.

The letter ordered Mr. Blum to stop using the GreenLight name. The hedge fund followed up by filing a lawsuit in May.

Continue reading “The entrepreuner’s naming trap 2: Lack of due diligence”

Coinstar, Amazon and the entrepreneur’s naming trap

What has the name ‘Starbucks’ got to do with coffee?

Apart from now being the name of the world’s largest coffee chain, it has absolutely nothing to do with the dark, bitter brew.

The company was named after a minor character in Herman Melville’s book ‘Moby Dick’. As anyone who has read the book can testify, Starbuck drinks not a drop of coffee. According to the Starbucks website the founders considered naming it after Captain Ahab’s boat, the Pequod, but minds were changed when a friend tried out the tagline, “Have a cup of Pequod.” Starbuck was the fallback choice.

“Customers must recognize that you stand for something”, CEO Howard Schultz once astutely observed. The Starbucks brand and business is built around his vision of recreating the Italian coffee bar culture in the US, not the commodity product.

How important was coffee to Starbuck’s success? Essential. It gave the business an early focus on the culture of coffee and a ‘known for” brand. Today, the brand has widened into that of a place to relax, meet and work.

Stores sell many things apart from mocha frappuccinos  — packaged food items, hot and cold sandwiches, mugs and tumblers; select “Starbucks Evenings” locations offer beer, wine, and appetizers. The point being the name has the necessary flexibility to grow with the business.

There’s an important naming lesson in that observation for every entrepreneur.

They have a great idea for a new product; they reason, not unnaturally, that the product is the business and the business is the product and, therefore, the name of the product becomes the name of the company.

Screen Shot 2016-05-14 at 3.03.19 PMCollege graduate student Jens Molbak had a great idea for all that loose change we accumulate in jars.

The bank won’t accept coins unless they are sorted and rolled. He came up with Coinstar, those green vending machines you see in supermarkets where people dump their change and receive dollar bills. Coinstar takes a percentage.

A nice idea, and a very nice business. The company has processed more than 350 billion coins in its nearly two decades of operation.

In 2009 Coinstar came face-to-face with the limitations of its name when it acquired Redbox, the DVD rental company. Molbak realized the future of the business is really about dispensing machines, not coins. Coinstar is a limiting name for a business that wants to expand beyond coins.

The company changed it name to Outerwall to better reflect its evolving lineup of automated kiosks and is now a multi-national provider of services for the front end of retail stores, including bulk vending, prepaid products (gift cards), money transfer, automated DVD rentals via Redbox and coin counting.

Business focus is essential, but when it comes to corporate naming entrepreneurs need to think beyond the product and ask themselves the question, ‘What business am I really in?’ Changing a company name just as the business is hitting its stride is disruptive, expensive and unnecessary with a little forethought.

MP3Car faced a similar dilemma.

The company traces its roots to a worldwide online community of geeks in the 1990s who installed personal computers filled with electronic music files, or MP3s, in their cars. Along the way, MP3Car’s engineers developed increasing expertise in building and integrating mobile computers and started consulting and selling computers to companies and government agencies.

“MP3Car.com is obviously a misnomer at this point,” said CEO Heather Sarkissian in a 2009 interview with the Baltimore Sun. “It’s a very well-known brand. However, it is very confusing to our [business-to-business] enterprise customers.”

The name was a stumbling block for potential clients and even investors.

“One investor thought all we do is put MP3 players in cars,” Heather Sarkissian said in the interview. “He told us we’d be out of business in two years. … I had to explain to him what we really do.”

MP3Car tried to save money by doing its renaming and branding itself.

“I’m telling you, it’s all been thought of. … It’s crazy,” she said. “This has been an incredible challenge.”

So much so that the company seems to have abandoned the attempt.

Amazon

Jeff Bezos wanted anything but a limiting name when he founded Amazon.

It was very nearly called Cadabra, as in “abracadabra” – the word magicians use when performing a trick. His lawyer apparently misheard the word as “cadaver” so Bezos instead named the business after the river, reportedly for two reasons: one, to suggest scale – Amazon.com launched with the tagline “Earth’s biggest book store” (a great value proposition) –  and two, back then website listings were often alphabetically before Google came along.

On it’s march to global retail hegemony Amazon has helped to put retailers Borders Books, Tower Records and Blockbuster out of business.

Books now represent a tiny fraction of its revenues. Amazon Web Services (AWS) has become the retailer’s money machine, accounting for more than half of the company’s operating profit while on track to do more than $10 billion in sales this year.

What a mistake books.com would have been.